Mukuka M.J. MTech 2014

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COST AND SCHEDULE OVERRUNS ON CONSTRUCTION

PROJECTS IN SOUTH AFRICA
By
MUKUKA JOSEPH MULENGA
A DISSERTATION
Submitted in fulfilment of the requirements for the degree
MASTERS TECHNOLOGIAE
in
CONSTRUCTION MANAGEMENT
in the
FACULTY OF ENGINEERING AND THE BUILT ENVIRONMENT
at the
UNIVERSITY OF JOHANNESBURG
SUPERVISOR: DR. C.O. AIGBAVBOA
CO-SUPERVISOR: PROF. W.D. THWALA
2014
COST AND SCHEDULE OVERRUNS ON CONSTRUCTION

PROJECTS IN SOUTH AFRICA
MUKUKA JOSEPH MULENGA
SUPERVISOR: DR. C.O. AIGBAVBOA
CO-SUPERVISOR: PROF. W.D. THWALA
A DISSERTATION submitted in fulfilment of the requirements for the award of the degree
Masters Technologiae in Construction Management in the Faculty of engineering and the
built environment, Department of Construction Management and Quantity Surveying at the
University of Johannesburg, Republic of South Africa.
JOHANNESBURG, DECEMBER 2014
DECLARATION
I, MUKUKA MULENGA JOSEPH, do hereby declare that this dissertation is the result of
my own investigation and research, except to the extent indicated in the references and by
comments included in the body of the report and that it has not been presented elsewhere for
a similar purpose. It was submitted to the University of Johannesburg (Department of
Quantity Surveying and Construction Management), as a requirement to obtain a MASTERS
OF TECHNOLOGIAE degree in Construction Management.
Signature
Date
University of Johannesburg,
Doornfontein Campus
ACKNOWLEDGEMENTS
My gratitude to the Almighty God for guiding me this far in life. Without him I would have
not been able to do anything. I am also grateful to Him for granting me the strength to carry
out this research study.
I wish to express my sincere thanks and appreciation to the following people for their
assistance, guidance and contribution to this study:
My supervisor, Dr. Clinton Aigbavboa, for his professional and expert guidance
throughout the course of this study.
My co-supervisor, Professor Wellington Didibhuku Thwala for the support and
guidance during this study.
Statkon for data input and analysis. My special thanks go to Richard Devey for the
countless hours spent working with me.
All the respondents for their time in completing the questionnaire.
My brother and sisters for their support and encouragement (Silvia Mukuka, Peter
Chisulo Mukuka, Bwalya Elizabeth Mukuka, Chileshe Mukuka and Chibesa
Mukuka).
Dr. Innocent Musonda (Bashi Nkatya) for his expert guidance.
The Musonda Family: Patricia Musonda, Nkatya Musonda and Nkumbu Musonda.
Abena Munkonge too numerous to mention, but each and every one nakalebalika.
My friends: Gift Siwale, Mandisa Sibiya, Liphadzi Murendeni, Livhuwani Tshikhudo,
Justice Kekana, Tshomarelo Nchoe, Lugisile Maseko, Lerato Ngwenya, George
Kekana and Eke Chikezie.
My boss, Stewart Horne for the support and encouragement to always work hard.
Finally, I would like to express my profound gratitude to the Department of
Construction Management and Quantity Surveying, University of Johannesburg,
South Africa for giving me the opportunity to study with them.
ii
DEDICATION
I dedicate this Dissertation to my parents, Elias Chisulo Mukuka and Mary Bupe Mutangashi.
Tata na Mayo, nakalebalika.
iii
ABSTRACT
The construction industry is a key sector in the development and economic growth of South
Africa. However, the industry has not escaped the challenges facing other countries
worldwide in terms of delivering construction projects within budget and on time as
stipulated in the contracts. This study assesses the causes, effects and measures of minimising
construction projects cost and schedule overruns in the Gauteng Province of South Africa.
The data used in this study were derived from both primary and secondary sources. The
secondary data was collected via detailed review of related literature. The primary data was
collected through a questionnaire which was distributed to construction professionals. Out of
the 200 questionnaires sent out, 146 were received representing a 73% response rate.
Findings revealed that inadequate planning, change in project design, poor project
management, inadequate financial provision and inaccurate estimates were the major causes
of construction projects cost overruns. Furthermore the study also showed that the causes of
construction projects schedule overruns in Gauteng province included: slowness in decision
making process, reworks due to errors during construction, delays in approving major
changes in the scope of work, delay in material delivery, shortage of skilled equipment
operators and low productivity level of workers. Additionally, it was observed that
construction project delays, increased project cost due to extension of time, liability of
companies to bad debt and project abandonment. The study also revealed that extension of
time, cost overruns, loss of profit, disputes and poor quality of work due to hurrying the
project were the major effects of construction projects schedule overruns. Likewise, the study
revealed that adequate planning, proper pre-contract planning, proper project implementation
and management and good workmanship were the most effective ways of minimising
construction projects cost overruns. Finally the results revealed that proper project planning
and scheduling, effective strategic planning, site management and supervision, frequent
coordination between the construction team, availability of clear information and
communication channels were the most effective ways of minimising construction projects
schedule overruns in the Gauteng Province of South Africa. It is recommended that all
members of construction teams be trained and educated of the factors that cause project cost
and schedule overruns in order to minimise these overruns.
Key Words: Cost Overruns, Construction Industry, Gauteng Province, Schedule Overruns,
South Africa.
iv
TABLE OF CONTENTS
DECLARATION ..................................................................................................................................... i
ACKNOWLEDGEMENTS .................................................................................................................... ii
DEDICATION ....................................................................................................................................... iii
ABSTRACT........................................................................................................................................... iv
TABLE OF CONTENTS ........................................................................................................................ v
LIST OF TABLES ................................................................................................................................. xi
LIST OF FIGURES .............................................................................................................................. xii
LIST OF MAPS ................................................................................................................................... xiii
LIST OF ABBREVIATIONS ...............................................................................................................xiv
CHAPTER ONE ................................................................................................................................... 1
INTRODUCTION................................................................................................................................. 1
1.1
BACKGROUND ........................................................................................................................ 1
1.1.1
Construction projects cost overruns .................................................................................... 1
1.1.2
Construction projects schedule overruns ............................................................................ 2
1.2
AIM OF THE STUDY................................................................................................................ 3
1.3
PROBLEM STATEMENT ......................................................................................................... 3
1.4
RESEARCH QUESTIONS......................................................................................................... 3
1.5
OBJECTIVES OF THE STUDY ................................................................................................ 4
1.6
MOTIVATION FOR THE STUDY .......................................................................................... 4
1.7
PURPOSE OF THE STUDY ...................................................................................................... 4
1.8
RESEARCH METHODOLOGY AND DESIGN ...................................................................... 4
1.8.1
RESEARCH METHODOLOGY ............................................................................................ 4
1.8.2
RESEARCH APPROACH AND DESIGN ............................................................................ 5
1..8.3
RESEARCH AREA AND TARGETED RESPONDENTS ................................................... 5
1. 8.4
SAMPLING AND DATA COLLECTION ............................................................................ 5
1.8.5
LIMITATIONS ....................................................................................................................... 5
1.8.6
ETHICAL CONSIDERATION .............................................................................................. 5
1.9
OVERVIEW OF CHAPTERS .................................................................................................... 6
1.10
CHAPTER SUMMARY ............................................................................................................. 7
CHAPTER TWO .................................................................................................................................. 8
OVERVIEW OF THE CAUSES, EFFECTS AND MEASURES OF MINIMISING

CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS ...................................... 8
2.1
CHAPTER INTRODUCTION ................................................................................................... 8
2.2
CONSTRUCTION PROJECT COST OVERRUNS .................................................................. 8
2.3
CAUSES OF CONSTRUCTION PROJECTS COST OVERRUNS .......................................... 8
2.4
EFFECTS OF PROJECT COST OVERRUNS ........................................................................ 10
2.5
MEASURE OF MINIMISING PROJECT COST OVERRUNS .............................................. 12
2.6
CONSTRUCTION PROJECT SCHEDULE OVERRUNS...................................................... 13
2.7
CAUSES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS ............................... 14
2.7.1
Owner-related causes of construction project schedule overruns ..................................... 14
2.7.2
Contractor-related causes of schedule overruns ................................................................ 15
2.7.3
Consultant-related causes of schedule overruns ............................................................... 16
2.7.4
Material-related causes of schedule overruns ................................................................... 17
2.7.5
Equipment-related causes of schedule overruns ............................................................... 17
2.7.6
Labour-related causes of schedule overruns ..................................................................... 18
2.7.7
Causes of schedule overruns by external factors .............................................................. 18
2.8
TYPES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS .................................. 19
2.8.1
Critical Versus Non-Critical schedule overruns ............................................................... 19
2.8.2
Excusable versus non-excusable schedule overruns ......................................................... 20
2.8.3
Compensable versus non-compensable schedule overruns............................................... 20
2.8.4
Concurrent schedule overruns ........................................................................................... 21
2.9
EFFECTS OF SCHEDULE OVERRUNS ............................................................................... 22
2.10
METHODS OF MINIMISING CONSTRUCTION SCHEDULE OVERRUNS ..................... 24
2.11
LESSONS LEARNT ................................................................................................................ 26
2.12
CHAPTER SUMMARY ........................................................................................................... 27
CHAPTER THREE ............................................................................................................................ 28

CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS IN MALAYSIA ........ 28
3.0
CHAPTER INTRODUCTION ................................................................................................. 28
3.1
THE MALAYSIAN CONSTRUCTION INDUSTRY ............................................................. 28
3.2
COST AND SCHEDULE OVERRUNS IN MALAYSIA ....................................................... 29
3.3
CAUSES OF PROJECT COST OVERRUNS IN MALAYSIA .............................................. 30
3.4
MEASURE OF MINIMISING PROJECTS COST OVERRUNS IN MALAYSIA ................ 31
3.5
CONSTRUCTION PROJECT SCHEDULE OVERRUNS IN MALAYSIA .......................... 32
3.6
CAUSES OF CONSTRUCTION PROJECTS SCHEDULE OVERRUNS ............................. 32
vi
3.7
EFFECTS OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS .............................. 33
3.8
3.9
LESSONS LEARNT ................................................................................................................ 35
3.10
CHAPTER SUMMARY ........................................................................................................... 36
CHAPTER FOUR............................................................................................................................... 37
CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS IN NIGERIA ............ 37
4.0
4.1
THE NIGERIAN CONSTRUCTION INDUSTRY.................................................................. 37
4.2
CONSTRUCTION PROJECTS COST OVERRUNS IN NIGERIA ....................................... 38
4.3
CAUSE OF PROJECTS COST OVERRUNS IN NIGERIA ................................................... 38
4.4
MEASURE OF MINIMISING PROJECT COST OVERRUNS IN NIGERIA ....................... 40
4.5
CONSTRUCTION PROJECT SCHEDULE OVERRUNS...................................................... 41
4.6
CAUSES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS ............................... 41
4.7
EFFECTS OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS .............................. 42
4.8
4.9
LESSONS LEARNT ................................................................................................................ 45
4.10
CHAPTER SUMMARY ........................................................................................................... 46
CHAPTER FIVE ................................................................................................................................ 47

CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS: CASE STUDIES
FROM DEVELOPED AND DEVELOPING COUNTRIES .......................................................... 47
5.0
CHAPTER INTRODUCTION ................................................................................................ 47
5.1
THE SOUTH AFRICAN CONSTRUCTION INDUSTRY ..................................................... 47
5.1.1
Construction Industry Development Board (CIDB) ......................................................... 48
5.1.2
Challenges facing the South African construction industry .............................................. 49
5.1.3
Cost and schedule overruns in South Africa ..................................................................... 50
5.2
LESSONS LEARNT ................................................................................................................ 52
5.3
COST AND SCHEDULE OVERRUNS IN UGANDA ........................................................... 52
5.4
LESSONS LEARNT ................................................................................................................ 53
5.5
COST AND SCHEDULE OVERRUNS IN GHANA .............................................................. 54
5.6
LESSONS LEARNT ................................................................................................................ 55
5.7
COST AND SCHEDULE OVERRUNS IN INDIA ................................................................. 56
5.8
LESSONS LEARNT ................................................................................................................ 57
5.9
COST AND SCHEDULE OVERRUNS IN AMERICA (FLORIDA) ..................................... 57
5.10
LESSONS LEARNT ................................................................................................................ 59
vii
5.11
CHAPTER SUMMARY ........................................................................................................... 59
CHAPTER SIX ................................................................................................................................... 60

RESEARCH METHODOLOGY AND DESIGN ............................................................................ 60
6.1
CHAPTER INTRODUCTION ................................................................................................ 60
6.2
RATIONAL OF THE STUDY ................................................................................................. 60
6.3
RESEARCH APPROACH AND DESIGN .............................................................................. 60
6.4
RESEARCH AREA .................................................................................................................. 61
6.5
TARGET POPULATION ......................................................................................................... 62
6.6
SAMPLE ................................................................................................................................... 62
6.7
DATA COLLECTION ............................................................................................................. 63
6.8
INSTRUMENT OF DATA COLLECTION ............................................................................. 63
6.9
PERIOD OF COLLECTION .................................................................................................... 64
6.10
MEAN ITEM SCORE (MIS) ................................................................................................... 65
6.11
CONSISTENCY ....................................................................................................................... 66
6.12
DATA ANALYSIS ................................................................................................................... 67
6.13
LIMITATION OF THE STUDY .............................................................................................. 68
6.14
ETHICAL CONSIDERATION ................................................................................................ 68
6.15
CHAPTER SUMMARY ........................................................................................................... 68
CHAPTER SEVEN ............................................................................................................................. 69

QUESTIONNAIRE SURVEY RESULTS ........................................................................................ 69
7.1
7.2
BIOGRAPHICAL DATA ......................................................................................................... 69
7.2.1
7.3
Biographical data results ................................................................................................... 70
DATA ANALYSIS ................................................................................................................... 71
7.3.1 Section A: Background information of respondents. ............................................................... 71

7.3.2 Section B: Causes of construction projects cost overruns in Gauteng, South Africa .............. 80
7.3.3 Section C: Causes of construction projects schedule overruns in Gauteng, South Africa ....... 81
7.3.3.1 Owner-related causes of construction project schedule overruns in Gauteng, South Africa
...................................................................................................................................................... 81
7.3.3.2 Contractor-related causes of construction project schedule overruns in Gauteng, South
Africa ............................................................................................................................................ 82
7.3.3.3 Consultant-related causes of construction project schedule overruns in Gauteng, South
Africa ............................................................................................................................................ 83
7.3.3.4 Material-related causes of construction project schedule overruns in Gauteng, South
Africa ............................................................................................................................................ 84
viii
7.3.3.5 Equipment-related causes of construction project schedule overruns in Gauteng, South

Africa ............................................................................................................................................ 85
7.3.3.6 Labour-related causes of construction project schedule overruns in Gauteng, South Africa
...................................................................................................................................................... 86
7.3.3.7 Causes of construction project schedule overruns by external factors in Gauteng, South
Africa ............................................................................................................................................ 87
7.3.3.8 Health and safety-related causes of construction project schedule overruns in Gauteng,
South Africa .................................................................................................................................. 88
7.3.4 Section D: Effects of construction projects cost overruns in Gauteng, South Africa .............. 89
7.3.5 Section E: Effects of construction projects schedule overruns in Gauteng, South Africa ....... 90
7.3.6 Section F: Measures to minimising construction projects cost overruns in Gauteng, South
Africa ................................................................................................................................................ 92
7.3.7 Section G: Measures to minimising construction projects schedule overruns in Gauteng, South
Africa ................................................................................................................................................ 93
7.4
CHAPTER SUMMARY ........................................................................................................... 94
CHAPTER EIGHT ............................................................................................................................. 95

DISCUSSION OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS ...................... 95
8.1
8.2
RESEARCH QUESTION 1 ...................................................................................................... 95
8.2.1
8.3
Findings............................................................................................................................. 95
RESEARCH QUESTION 2 ...................................................................................................... 96
8.3.1
Findings............................................................................................................................. 96
8.3.1.1 Owner-related causes of construction projects schedule overruns .................................... 96

8.3.1.2 Contractor-related causes of construction projects schedule overruns ............................. 97
8.3.1.3 Consultant-related causes of construction projects schedule overruns ............................. 97
8.3.1.4 Material-related causes of construction projects schedule overruns ................................. 98
8.3.1.5 Equipment-related causes of construction projects schedule overruns ............................. 98
8.3.1.6 Labour-related causes of construction projects schedule overruns ................................... 99
8.3.1.7 Causes of construction projects schedule overruns by external factor .............................. 99
8.3.1.8 Health and Safety-related causes of construction projects schedule overruns ................ 100
8.4
RESEARCH QUESTION 3 .................................................................................................... 100
8.4.1
8.5
8.5.1
8.6
Findings........................................................................................................................... 100
Findings........................................................................................................................... 101
8.6.1
Findings........................................................................................................................... 101
ix
8.7
CONCLUSIONS..................................................................................................................... 102
8.7.1
RESEARCH OBJECTIVE 1 .......................................................................................... 103
8.7.2
8.7.3
8.7.4
8.7.5
8.8
GENERAL RESEARCH CONCLUSION ............................................................................. 106
8.9
RECOMMENDATIONS ........................................................................................................ 107
8.10
AREAS FOR FURTHER STUDIES ...................................................................................... 108
REFERENCES .................................................................................................................................. 109

APPENDIX 1: Cover Letter............................................................................................................... 120
APPENDIX 2: Questionnaire ............................................................................................................. 121
LIST OF TABLES
Table 6.1: Questionnaire survey .............................................................................................. 64
Table 6.2: Consistence test using the Cronbach's Alpha ......................................................... 67
Table 7.1: Causes of construction projects cost overruns ........................................................ 80
Table 7.2: Owner related causes of construction projects schedule overruns ......................... 82
Table 7.3: Contractor related causes of construction projects schedule overruns ................... 83
Table 7.4: Consultant related causes of construction projects schedule overruns ................... 84
Table 7.5: Material related causes of construction projects schedule overruns ....................... 85
Table 7.6: Equipment related causes of construction projects schedule overruns ................... 86
Table 7.7: Labour related causes of construction projects schedule overruns ......................... 87
Table 7.8: Causes of construction projects schedule overruns by external factors ................. 88
Table 7.9: Health and Safety related causes of construction projects schedule overruns ........ 89
Table 7.10: Effects of construction projects cost overruns ...................................................... 90
Table 7.11: Effects of construction projects schedule overruns .............................................. 91
Table 7.12: Measures of minimising construction projects cost overruns............................... 92
Table 7.13: Measure of minimising construction projects schedule overruns......................... 94
xi
LIST OF FIGURES
Figure 2. 1: Types of schedule overruns .................................................................................. 21
Figure 7.1: Respondents Gender ............................................................................................. 71
Figure 7.2: Respondents' age group ......................................................................................... 72
Figure 7. 3: Respondent's ethnicity .......................................................................................... 72
Figure 7. 4: Respondents' professional qualification ............................................................... 73
Figure 7. 5: Respondents' years of experience ......................................................................... 74
Figure 7. 6: Respondents' Education qualification .................................................................. 74
Figure 7. 7: Respondents' current employer ............................................................................ 75
Figure 7. 8: Respondents' construction projects involved in ................................................... 75
Figure 7. 9: Construction projects beyond original contract sum ............................................ 76
Figure 7. 10: Construction projects amounts overruns ............................................................ 77
Figure 7. 11: Construction projects behind schedule ............................................................... 77
Figure 7. 12: Period of schedule overrun ................................................................................. 78
Figure 7. 13: Types of projects which experience cost overruns ............................................. 79
Figure 7. 14: Types of projects that experience schedule overruns ......................................... 79
xii
LIST OF MAPS
Map 6.1: Map of Gauteng Province, South Africa .................................................................. 61
xiii
LIST OF ABBREVIATIONS
EOT
Extension of Time
FDOT
Florida Department of Transportation
GDP
Gross Domestic Product
Rank
SA
South Africa
SD
Standard deviation
SPSS
Statistical package for Social Sciences
UJ
University of Johannesburg
USA
United States of America
ZAR
South African Rand
xiv
CHAPTER ONE
INTRODUCTION
1.1
BACKGROUND
This dissertation is on the causes, effects and measures of minimising construction projects
cost and schedule overruns in South Africa. This introductory chapter outlines the basic
background information of the study. This chapter highlights various components of the study
and provides the structure which the study followed. The components of the study included
the research problem, research questions, the objectives of the study, the purpose, rationale,
scope and limitations and definitions of key terms. In order to bring about some background
information, this chapter highlights the importance of delivering construction projects within
budget and on time.
1.1.1 Construction projects cost overruns

Cost overruns are very common in the construction industry. Hardly projects get completed
within estimated costs (Subramani, Sruthi, and Kavitha, 2014:2). Al-Najjar (2002:5) defines
cost overruns as the change in contract amount divided by the original contract award
amount. However, Zhu and Lin (2004) state that cost overrun can be defined as excess of
actual cost over budget. Cost overrun is also sometimes called cost escalation, cost increase
or budget overrun. Hence part of the study aimed at identifying the causes and effects of cost
overruns on construction projects.
Memon, Rahman and Abdul Azis (2011:58) argue that cost is among the major
considerations throughout the project management life cycle and can be regarded as one of
the most important parameters of a project and the driving force of project success. Olawale
and Sun (2010) state that despite the availability of various control techniques and project
control software many construction projects still do not achieve their cost objectives. Hence,
despite its proven importance, it is not uncommon to see a construction project failing to
achieve its objectives within the specified cost (Memon, Rahman, Asmi, and Azis, 2010:42).
Like other countries, construction industry in South Africa is also facing a lot of challenges
such as the delay in completing projects on time, expenditure exceeding budgets and building
defects that are seen too soon after completion of projects. To avoid construction cost
1
overruns, the very first and most important step is to identify and understand the factors
responsible for the overruns (Memon, Rahman, Asmi and Azis 2010:1). According to Love,
Sing, Wang, Irani and Thwala (2014:141) reworks during construction as a result of design
changes, errors and omission are the major contributors of overruns in projects. Park and
Papadopoulou (2012:196) state that construction cost overruns mean negative publicity for
the design team and loss of client confidence. The repercussions for contractors are similar as
they see their profit margins shrink. Hence the first aim of this study was to identify the
causes, effects and measures that need to be taken to minimise construction cost overruns in
the Gauteng Province of South Africa.
1.1.2 Construction projects schedule overruns

Projects or construction works that are not delivered on time to the client are referred to as
projects that have undergone schedule overruns.
Mohamad (2010:1) defines schedule
overruns as an act or event that extends the time to complete or perform an act under the
contract. Also, Assaf and Al-Hejji (2006: 349), define schedule overruns as the time overrun
either beyond completion date specified in a contract, or beyond the date that the parties
agreed upon for delivery of a project. It is basically a project slipping over its planned
schedule and is considered as common problem in construction projects worldwide. Assaf
and Al-Hejji (2006: 349) further illustrate that, to the owner, schedule overruns means loss of
revenue through lack of production facilities and rent-able space or a dependence on present
facilities. In some cases, to the contractor, schedule overruns means higher overhead costs
because of longer working periods, higher material costs through inflation, and due to labour
cost increases. Alkhathami (2004:14) states that schedule overruns can be defined as extra
time required to finish a given construction project beyond its original planned duration,
whether compensated for or not.
Theodore (2009: 25) classifies delays in project completion time into two, those caused by
the client and those caused by the contractor. Delays caused by the client such as late
submission of drawings and specifications, frequent change orders, and incorrect site
information generates claims from both the main contractors and sub-contractors which many
times entail lengthy court battles with huge financial repercussions (Theodore, 2009: 25).
Delays caused by contractors can generally be attributed to poor managerial skills. Lack of
planning and a poor understanding of accounting and financial principles have led to many a
contractors downfall (Theodore, 2009: 25). The desire to finish a project on time, under the
2
planned budget, with the highest quality, and in a safe manner are common goals for all
contract parties, including the owner, contractor, and consultant (Alkhathami, 2004:14).
Hence, the second aim of this research was to identify the causes of schedule overruns in the
South African construction industry and the types of schedule overruns that occur during the
construction process. Further, it aimed at identifying the effects of these schedule overruns
and eventually establish the measures that can be taken to remedy late delivery of
construction projects in South Africa.
1.2
AIM OF THE STUDY
The aim of this study is to gain insight into the causes cost and schedule overruns in the
South African construction industry. The second aim of the research is to further add to the
knowledge base on the effects of cost and schedule overruns in the South African
construction industry. This study will also investigate measures of minimising construction
projects cost and schedule overruns in the South African construction industry.
1.3
PROBLEM STATEMENT
Most construction projects in South Africa are faced with a number of problems. However,
cost and schedule overruns are the most significant problems faced by the industry. Cost and
schedule overruns impact negatively on the construction industry; hence the need to find
solutions to factors that cause these overruns. The problem investigated in this research
project was to determine the factors causing construction projects cost and schedule overruns,
determine their effects and further determine measures of minimising cost and schedule
overruns in South Africa.
1.4
RESEARCH QUESTIONS
The following set of questions were used to guide the integrated study of cost and schedule
overruns on construction projects in South Africa.
1. What are the factors that cause cost overruns on construction projects in South Africa?
2. What are the factors that cause schedule overruns on construction projects in South
Africa?
3. What are the effects of cost overruns on construction projects in South Africa?
4. What are the effects of schedule overruns on construction projects in South Africa?
5. What measures can be taken to minimise cost and schedule overruns on construction
projects in South Africa?
3
1.5
OBJECTIVES OF THE STUDY
The major objectives of this study can be highlighted as follows:
1. To determine the factors that causes cost overruns on construction projects in South
Africa.
2. To determine the factors that causes schedule overruns on construction projects in
South Africa.
3. To analyse the effects of cost overruns on construction projects in South Africa.
4. To ascertain the effects of schedule overruns on construction projects in South Africa.
5. To establish measures that can be taken to minimise cost and schedule overruns on
construction projects in South Africa.
1.6
MOTIVATION FOR THE STUDY
The motivation for conducting this research was to improve the knowledge base of cost and
schedule overruns in the South African construction industry. The results of this study will
contribute towards a better understanding of the causes, effects and measures on minimising
construction projects cost and schedule overruns by construction professionals. Furthermore,
this study will help construction professionals in understanding the different factors that
cause cost and schedule overruns during the construction processes.
1.7
PURPOSE OF THE STUDY
Project successes are usually measured on the basis of time, quality and works done within
budget, hence the need to overcome cost and schedule overruns on construction projects.
Cost and schedule overruns on construction projects can lead to disputes among construction
parties, escalations of original contract price and contract terminations if not well managed.
Therefore, the purpose of this study is to determine the factors causing project cost and
schedule overruns, analyse their effects and ascertain measures of minimising cost and
schedule overruns in Gauteng Province of South Africa.
1.8
RESEARCH METHODOLOGY AND DESIGN
1.8.1 RESEARCH METHODOLOGY

Research methodology explains the method used in carrying out the research. This section
outlines the geographical area where the research was conducted; the study design and the
population sample. The instruments used in collecting data and methods implemented to
maintain validity and reliability of the instruments are also described.
1.8.2 RESEARCH APPROACH AND DESIGN

The quantitative approach was adopted in this research. A descriptive survey design was also
adopted in the current study, thus, a questionnaire was designed and distributed to the
respondents by the researcher.
1..8.3 RESEARCH AREA AND TARGETED RESPONDENTS

This study was carried out in Gauteng Province of South Africa, targeting construction
professionals in the area who are currently working or have worked on completed or ongoing construction projects. The target population of this research was architects, quantity
surveyors, civil engineers, construction managers, construction project managers, project
managers and other professionals that are involved in construction projects in Gauteng
Province, South Africa.
1. 8.4 SAMPLING AND DATA COLLECTION

This study adopted a random sampling method; hence all the participants had an equal chance
of being selected. A questionnaire was developed as a tool of collecting data from the
respondents in accordance with the reviewed literature.
1.8.5 LIMITATIONS
This research assessment was on construction professionals in Gauteng Province in South
Africa, with the respondents being architects, quantity surveyors, civil engineers, construction
managers, construction project managers, project managers and other professionals that are
involved in construction projects in the province. This study determines the factors causing
construction projects cost and schedule overruns and their effects. It, however, establishs the
measures that will be employed to minimise cost and schedule overruns in Gauteng Province,
South Africa.
1.8.6 ETHICAL CONSIDERATION

The current study did not encounter or identify any ethical issues. However, the ethical
considerations in this research involved acknowledging professionals in the industry whose
work had been cited and therefore
contributed to the literature. The obligation to the

5
participants who responded to the research questionnaire, was that their input would be kept
confidential and only used for academic purposes. Respondents to the questionnaire had the
right not to answer questions that they felt were not appropriate without any coercion.
1.9
OVERVIEW OF CHAPTERS
CHAPTER 1
Introduction
This chapter defines the problem that the researcher aimed to investigate and shows how the
investigation of the problem was done. The introduction gives an overview of the problem
and the research questions. This chapter, therefore, gives a framework of the whole study.
CHAPTER 2
Overview of the causes, effects and measures of minimising

construction projects cost and schedule overruns
This chapter reviews literature on the same topic by scholars and researchers in the field of
Construction Management. Literature review gives the readers knowledge and ideas that have
been established by other researchers on the topic. Hence this chapter gave the readers an
understanding of the causes of project cost and time overruns, their effects and further the
measures of minimising cost and time overruns in the construction industry.
CHAPTER 3
Construction projects cost and schedule overruns in Malaysia
This chapter reviews literature on the same topic by accredited scholars and researchers in
Malaysia. Hence this chapter gives the reader an understanding of the causes of construction
projects cost and time overruns, their effects and further, the measures of minimising cost and
time overruns in the Malaysian construction industry.
CHAPTER 4
Construction projects cost and schedule overruns in Nigeria
This chapter reviews literature on the same topic by scholars and researchers in Nigeria.
Hence this chapter gives the reader an understanding of the causes of construction projects
cost and time overruns, their effects and further the measures of minimising cost and time
overruns in the Nigerian construction industry.
CHAPTER 5
Construction projects cost and schedule overruns: Case studies

from developed and developing countries
This chapter reviews literature on the same topic by scholars and researchers in the field.
Literature review gives the readers knowledge and ideas that have been established by other
researchers on the topic. This chapter will present the concept of cost and schedule overruns
in South Africa, Uganda, Ghana, America and India using case studies.
CHAPTER 6
Research Methodology
This chapter shows the methods and plans that the researcher used to obtain participants and
further collect information from the participants. In this study, the researcher focused on
literature review and the questionnaire survey targeted at construction professionals in
Gauteng, South Africa. Furthermore, statistical methods were used to analyse the data
collected from the questionnaire survey are described in this chapter.
CHAPTER 7
Questionnaire survey results
Once an appropriate design and suitable means of measuring relevant variables had been
identified and adopted, the findings were analysed using an appropriate procedure. Statistical
techniques were adopted to analyse data and drew up findings. The analysed results then
provided a feedback with respect to the originally formulated questions.
CHAPTER 8
Discussion of findings, conclusions and recommendations
In Chapter 8 the findings analysed in Chapter 7 are discussed and linked to the literature
reviewed in order to establish if the research objectives were achieved and that all the
research questions were answered.
This chapter further concludes the study and gives
recommendations on how to minimise cost and schedule overruns on construction projects.
1.10
CHAPTER SUMMARY
In this chapter, the various components of the study were introduced. The research problem,
rationale, research questions and the structure of the study was discussed. It is against this
background that an understanding of the present research was attained. This chapter also
highlighted the importance of delivering construction projects on time and within budget.
The next chapter literature related to constructions project cost and schedule overruns from
various developed and developing countries are presented.
CHAPTER TWO
OVERVIEW OF THE CAUSES, EFFECTS AND MEASURES OF
MINIMISING CONSTRUCTION PROJECTS COST AND SCHEDULE
OVERRUNS
2.1
CHAPTER INTRODUCTION
This chapter gives a theoretical review and conceptual perspective of construction projects
cost and schedule overruns in the construction industry. Previous theories of construction
projects cost and schedule overruns, such as causes of cost and schedule overruns, effects of
cost and schedule overruns and measures of minimising cost and schedule overruns in the
construction industry are discussed in this chapter as well.
2.2
CONSTRUCTION PROJECT COST OVERRUNS
Cost is among the major considerations throughout the project management life cycle and can
be regarded as one of the most important parameters of a project and the driving force of
project success. Despite its proven importance, it is not uncommon to see a construction
project failing to achieve its objectives within the specified cost (Memon et al, 2010:42). AlNajjar (2008:5) defines cost overruns as the change in contract amount divided by the
original contract award amount. However, Zhu and Lin (2004) argue that cost overrun can be
defined as excess of actual cost over budget.
2.3
CAUSES OF CONSTRUCTION PROJECTS COST OVERRUNS
Cost overruns do not just occur naturally. There are a number of factors during the
construction process that when not managed properly can lead to cost overruns. Al-Najjar
(2008:117) identified a total of forty two factors that cause cost overruns and ranked them as
follows: technical incompetence, poor organizational structure, and failures of the enterprise;
lack of cost reports during construction stage; inadequate project preparation, planning and
implementation; delays in issuing information to the contractor during construction stage;
lack of coordination at design phase; change in the scope of the project or in Government
policies; Some tendering manoeuvres by contractors, such as front- loading of rates;
incomplete design at the time of tender; bad allocation of labour inside the site and delays in
decisions making by Government were ranked the top ten causes of cost overruns. Other
8
causes of cost overruns identified by Al-Najjar (2008:117) include: failure of specific

coordinating; delays in costing variations and additional works; lack of experience of project
type; re-measurement of provisional works; wrong or inappropriate choice of site; omissions
and errors in the bills of quantities; delay in project's handing over; absence of managerial
programs that help in saving materials inside the site; indecision by the supervising team in
dealing with the contractors queries resulting in delays; lack of experience of local
regulation; changes in owners brief; inability of the contractor to be adopted; property with
the projects environment; labour unrest; attracting skilful technicians for work; lack of
experience of technical consultants, inadequacy of foreign collaboration agreements,
monopoly of technology; unpredictable weather conditions;
long period of the project
maintenance period "one year "; and over time work hours of supervising engineer are paid
by the contractor. Further, Subramani, Sruthi and Kavitha (2014:5) says that the major cause
of cost overruns in India are slow decision making by clients, poor design or delay in
providing design and non-performance of sub-contractors. Furthermore, Enshassi, Al-Najjar
and Kumaraswamy (2009:143) state that the major causes of cost overruns in Gaza include:
escalation of materials prices due to continuous border closures, delay in construction, supply
of raw materials and equipment by contractors, fluctuations in the cost of building materials,
project materials monopoly by some suppliers and unsettlement of the local currency in
relation to dollar value.
However, these factors generally not in keeping with the factors identified in the study by
Azhar, Farooqui and Ahmed (2008:504) in which the top ten factors were ranked as follows:
fluctuation in prices of raw materials; unstable costs of manufactured materials; high cost of
machinery; lowest bidding procurement method; poor project management and poor cost
control; long periods between design and time of bidding or tendering; wrong method of cost
estimation; additional work; improper planning and inappropriate government policies.
Further, Alhomidan (2013:4) says that the critical factors that cause cost overruns include:
internal administrative problems, payments delay, poor communication between construction
parties and delays in decision making.
The study by Olawale and Sun (2010:17) used both a questionnaire survey and interviews,
the study obtained the following results which were ranked as follows: design changes; risk
and uncertainty associated with projects; inaccurate evaluation of projects time or duration;
non-performance of subcontractors and nominated suppliers; complexity of works; conflict
9
between project parties; discrepancies in contract documentation; contract and specification

interpretation disagreement; inflation of prices; financing and payment for completed works;
lack of proper training and experience on Project Managers; low skilled manpower;
unpredictable weather conditions; dependency on imported materials; lack of appropriate
software; unstable interest rates; fluctuation of currency or exchange rate; weak regulation
and control; project fraud and corruption and unstable government policies. Furthermore,
Rafiq, Abdur and Hamza (2012:362) revealed that the following are the major causes of cost
overruns on construction projects: additional work; inappropriate government policies and
priorities; improper planning; price escalation of construction materials and price adjustment;
land acquisition and resettlement; inconsistent cash flows; delay in decision-making by
clients; design errors and changes; inaccurate estimation and relocation of services and
utilities.
2.4
EFFECTS OF PROJECT COST OVERRUNS
Effects are the consequences that will be encountered when cost overruns occur in a
construction project. Nega (2008:63) states that cost overruns have obvious effects for the
key stakeholders in particular, and on the construction industry in general. To the client, cost
overruns imply added costs over and above those initially agreed upon at the onset, resulting
in less returns on investment. To the end user, the added costs are passed on as higher rental
or lease costs or prices. To the professionals, cost overruns imply inability to deliver value for
money and could well tarnish their reputation and result in loss of confidence reposed in them
by clients. To the contractor, it implies loss of profit for non-completion, and defamation that
could jeopardize his or her chances of winning further jobs, if at fault. To the industry as a
whole, cost overruns could bring about project abandonment and a drop in building activities,
bad reputation, and inability to secure project finance or securing it at higher costs due to
added risks (Nega, 2008:63).
The study of Nega (2008:103) further identified the following effects of cost overruns: delays
during construction; supplementary agreement; additional cost, budget short fall; adversarial
relationship between participants of the project; loss of reputation to the consultant, the
consultant will be viewed as incompetent by project owners; high cost of supervision and
contract administration for consultants; delayed payments to contractors; the contractor will
suffer from budget short fall of the client; poor quality workmanship; dissatisfaction on the
part of project owners and consequently end users; negative attitude towards the construction
10
industry by the higher public authority and by the society as a whole; the contribution of the
construction industry to the growth of national economy of the country will be less; cost
overruns in construction projects prevent the planned increase in property and service
production from taking place, and this phenomenon in turn affects, in a negative way, the rate
of national growth; weakens the growth of the construction industry by eroding mutual trust
and respect; pours money unnecessarily to the project at hand at the expense of other new
projects; distorts fair and equitable resource distribution; discourage investment, the
investment on building construction by public clients will be less, hence the number of
projects will decrease in the future; creates sceptical outlook on appraisal of other new
construction projects; some project owners (clients) become reluctant to effect additional
payments to contractors and they view the cost overrun as a fabricated thing. This will propel
delays on the project and becomes a source of dispute among participants of the project; and
creates frustration on stakeholders (Nega, 2008:103).
The study by Eshofonie (2008:20) identifies four effects of cost overruns and defines them as
follows:
Company or firm liability to insolvency and liability of the companies or firms to bad
debt: Any company is vulnerable to the threat of bankruptcy and insufficient cash
flows that could halt its otherwise timely and safe operations. Cash flows of its
construction projects should therefore receive full attention. They must be optimized
within their constraints framework that is set by a schedule that comprises many cost
inducing activities of a productive or an administrative nature, milestones, and
deadlines; and a budget with its financial terms and conditions that are specific to the
market, the company, or its planned project, for example, available credit and interest
rates. However, cash flows themselves have proven to be notoriously difficult to
model in an integrated manner as their individual elements are of very different
natures; some of them are fixed while others are variable, conditional, or even cursive
(Eshofonie, 2008:20).
Under-utilization of man-power resources, plants and equipment: Eshofonie

(2008:20) state that delays on the project consequently increase project cost. Delays
form the contractor the contractor to suffer from the inability to make thorough usage
of the resources and may thus find it difficult to secure potential projects.
11
Increased project cost due to extension of time: Longer project duration means that
more resources will need to be allocated to the project, which then increases the
project costs (Eshofonie, 2008:20).
Project abandonment: Project abandonment is as a result of lack of proper project

management and lack of proper project planning which has a negative effect on the
construction project cost. For the project not to be abandoned, proper project planning
and project management would need to be practiced (Eshofonie, 2008:20).
MEASURE OF MINIMISING PROJECT COST OVERRUNS
2.5
When all the causes and effects of cost overruns and been identified, it is necessary to also
identify measures of minimising cost overruns on construction projects. The study by Arcila
(2012:34) identified the following as the measures that can be used to minimise cost
overruns: adequacy of funding; adequacy of plans and specifications; budget updates;
constructability; economic risks; owner's involvement and frequent feedback; owner's
commitment to established schedules and budget; project manager commitment and
involvement; project manager competency and experience; realistic obligations and clear
objectives and risk identification and management. Kamaruzzaman (2010:113) discuss that
the major measures of minimising cost overruns on construction projects include: proper
project costing and financing; competent personnel; appropriate scope definition; proper cost
control and risk management during project execution.
However, the study by Olawale and Sun (2010:24) identifies four categories of measures that
can be used to minimise cost overruns on construction projects, these were explained as
follows:
Preventive measures: These are precautionary measures that are put in place as a
defence to the inhibiting factors. Most of these measures are active measures that
would be put in place during the planning stage of a project. (Olawale and Sun,
2010:24).
Predictive measures: Predictive measures are put in place in order to spot potential
problems to the control process in the future so that they can be stopped from
12
happening or be prepared for them should they happen. Most of these measures
actually utilise some tools or techniques to look into the current situation in a bid to
spot potential future problems (Olawale and Sun, 2010:24).
Corrective measures: These are measures that are utilised to mitigate the effect of
the project control inhibiting factors by acting as a remedy. These measures are
reactive measures that only act after the event. They may not be as effective as
preventive or predictive measures but they aim to bring the situation back on track or
at least stop the rot (Olawale and Sun, 2010:24).
Organisational measures: These measures generally encompass practices that go

wider than the actual control process but have an effect on project control; they are
normally in place because of the companys belief, orientation, management style or
philosophy, they have a tendency of not being specific to one project but would
normally affect all projects being undertaken by the company as they reflect how the
wider organisation works. (Olawale and Sun, 2010:25).
2.6
CONSTRUCTION PROJECT SCHEDULE OVERRUNS
The aim of any construction project is to successfully complete the project on time, within
budget and with high quality. This section focuses on the completion of projects on schedule
thus overcoming delays. Alkhathami (2004:14) defines schedule overruns as extra time
required to finish a given construction project beyond its original planned duration, whether
compensated for or not. Mohamad (2010:1) says schedule overruns are an act or event that
extends the time to complete or perform an act under the contract. Also, Assaf and Al-Hejji
(2006:349), defined schedule overrun as the time overrun either beyond completion date
specified in a contract, or beyond the date that the parties agreed upon for delivery of a
project. It is basically a project slipping over its planned schedule and is considered as
common problem in construction projects worldwide.
13
2.7
CAUSES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS
Causes of schedule overruns are factors or events that occur before and during the
construction process that will affect the time of completing a project. Ali, Smith, Pitt, and
Choon (2012:2) states that there are four factors that causes schedule overruns and
categorized them into the following categories: contractor- related factors, consultant-related
factors, client-related factors and external factors. Motaleb and Kishk (2010:1154) five
factors that can cause schedule overrun and these include change orders, slow decision
making by clients, lack of capability of client representative, construction financial
difficulties and late delivery of materials. Furthermore, Sambasivan and Soon (2007:524),
describe the following as the main causes of construction project schedule overruns:
contractors improper planning; contractors poor site management; inadequate contractor
experience; clients finance and payments for completed work; problems with subcontractors;
material shortages ; labour supply; equipment availability and failure; lack of communication
between parties; mistakes during the construction stage.
Hoverer; the current study adopted the categories studied by Theodore (2009:25-36) as they
were more comprehensive categories of causes of construction projects schedule overruns.
2.7.1 Owner-related causes of construction project schedule overruns

The study by Wei (2010:35) shows that late revising and approving of design documents by
the client is the major cause of schedule overrun associated with the client. However,
Mohamad s (2010:12) study illustrates that change in orders by owner during construction is
a major cause of schedule overruns in project delivery time, which is also in agreement with
the study by Motaleb and Kishk (2010:1153). In the work by Haseeb, Xinhai-Lu, Aneesa
Bibi, Maloof-ud-Dyian, and Rabbani (2011:28) and Assaf and Al-Hejji (2006:352) delay in
progress payments by owner was identified as the major cause of schedule overruns in project
delivery associated with the client. This is also shown in the study by Sambasivan and Soon
(2007:522). Further, Denini (2010:181) writes that the major causes of schedule overruns
related to the owner are slowness in the decision-making process by the owner and delay in
making progress payments to contractors. Furthermore, Ayudhya (2011:1032) found that the
major owner-related causes of schedule overruns include: delay in progress payment by
owner; adverse weather conditions; evaluation of completed works and insufficient working
drawing details. Ren, Atout and Jones (2008:754) show that unrealistic control duration;
many provisional sums and prime cost; nomination of sub-contractors and suppliers and
14
clients irregular payment to the main contractor are the major owner-related causes of
schedule overruns. The study by Theodore (2009) identified nine causes of schedule overruns
in this category and ranked them as follows:
Delay in progress payments;
Delay in furnishing and delivering the site;
Change of orders by owner during construction;
Late revising and approval of design documents;
Delay in approving shop drawing and sample materials;
Poor communication and coordination;
Slowness in decision-making process;
Conflicts between joint-ownership of the project;
Suspension of work by owner.
2.7.2 Contractor-related causes of schedule overruns

Theodore (2009) identified the contractor related causes of schedule overruns and ranked
them as shown below, with difficulties in financing projects by contractors being the major
cause of schedule overruns, this was in agreement with the study by Assaf and Al-Hejji
(2006:352). However in the study by Wei (2010:38), delays in sub-contractors works was
ranked as the highest contractor related cause of schedule. Further, Denini (2010:181)
revealed the following as the major contractor related causes of schedule overruns: financial
difficulties faced by the contractor; poor project planning and scheduling; inadequate
contractors' experience contractor-related; inaccurate cost estimation contractor-related and
poor site management and supervision. The study by Motaleb and Kishk (2010:1152) shows
that late delivery of materials is a major cause of contractor related schedule overruns.
Furthermore, Wong and Vimonsatit (2012:3396) show that financial difficulties; low speed of
decision; skills shortage; design errors made by designers; unforeseen ground conditions;
poor organization of the contractor or consultant; difficulty of coordination between various
parties; poor communication; shortage of labour and underestimation of time of completion
are the most significant contractor related causes of schedule overruns. Ren, Atout and Jones
(2008:755) revealed that non-preparing the method statements; financing project by the
contractor; luck of organizational chart; poor communication externally and internally and
mistakes during construction are the major contractor related causes of schedule overruns.
15
Difficulties in financing project;
Conflicts in sub-contractors schedule in execution of project;
Rework due to errors during construction;
Conflicts between contractor and other parties;
Ineffective planning and scheduling of project;
Improper construction methods implement;
Delays in sub-contractors work;
Inadequate contractor's work;
Frequent change of sub-contractors;
Poor qualification of the contractor's technical staff;
Delays in site mobilization (Theodore, 2009).
2.7.3 Consultant-related causes of schedule overruns

Theodore (2009) and Wei (2010:38) both identify and ranked delay in approving major
changes in the scope of work by consultants as the major cause of consultant related schedule
overruns. Further, the work of Le-Hoai, Lee and Lee (2008:370) showed that the major
consultant related causes of schedule overruns include: poor project management assistance;
inaccurate estimates; mistakes in design; poor contract management and slow inspection of
completed works. Further, Wong and Vimonsatit (2012:3396) revealed that the major
consultant related causes of schedule overruns include: changes in specifications during
construction; financial difficulties; skill shortage; shortage of labour; unrealistic deadlines for
project completion; underestimation of complexity of projects; poor communication;
materials shortage; underestimation of costs of projects and unforeseen ground conditions. In
the study by Assaf and Al-Hejji (2006:352), delay in performing inspection and testing by the
consultant was ranked as the highest cause of schedule overrun. However, Motaleb and Kishk
(2010:1152) established that inadequate consultant experience was the major cause of
schedule overruns associated with consultants. Ren, Atout and Jones (2008:754) revealed that
the major consultant related causes of schedule overruns include: incomplete drawings; delay
in approval of documents; incomplete contract documents; changes in drawings and
specifications and duration of inspection procedure.
16
The list below shows the causes identified by Theodore (2009), and they include:
Delay in approving major changes in the scope of work;
Inadequate experience of consultant;
Mistakes and discrepancies in design documents;
Delays in producing design documents;
Unclear and inadequate details in drawings;
Insufficient data collection and survey before design;
Lack of advanced engineering design software (Theodore, 2009).
2.7.4 Material-related causes of schedule overruns

The study by Sambasivan and Soon (2007:522), identified quality of material and shortage in
material to be the major causes of schedule overruns that are associated with materials. Wei
(2010:42) shows that delay in material delivery and shortage of construction materials on the
market are the two major causes of material related schedule overruns, this is also reflected in
the work of Assaf and Al-Hejji (2006:352). Further, Alwi and Hampson (2003:4) revealed
that the major material related causes of schedule overruns include: poor quality of materials;
delay of material delivery to site; poor material handling on site; poorly scheduled delivery of
material to site; inappropriate or misuse of material and poor storage of material.
However, Theodore (2009) identified six material related causes of schedule overruns and
ranked them as follows:
Shortage of construction materials in market;
Changes in material types during construction;
Delay in material delivery;
Damage of sorted material while they are needed urgently;
Delay in manufacturing special building materials;
Late procurement of materials (Theodore, 2009).
2.7.5 Equipment-related causes of schedule overruns

The list below by Theodore (2009) is in keeping with the study by Assaf and Al-Hejji
(2006:352) which identifies equipment breakdowns and shortage of equipment as the major
causes of equipment related schedule overruns. However, the study by Wei (2010: 46)
identified lack of high-technology mechanical equipment and low productivity and efficiency
17
of equipment as the top most causes of schedule overruns and they were both ranked first in
the study. Low level of equipment-operators skill was also identified as a major cause of
schedule overruns related to equipment.
Equipment breakdowns;
Shortage of equipment;
Low level of equipment-operator's skill;
Low productivity and efficiency of equipment;
Lack of high-technology mechanical equipment (Theodore, 2009).
2.7.6 Labour-related causes of schedule overruns

The study by Theodore (2009) shown below agrees with the study done by Assaf and AlHejji (2006:352) and Sambasivan and Soon (2007:522) where shortage of labour was
identified and ranked as the major cause of schedule overruns associated with labour force.
Shortage of labour;
Work permits for international workers;
Low productivity level of workers;
Personal conflicts among workers (Theodore, 2009).
Wei (2010:44) identified low productivity level of workers as the second highest cause of
schedule overruns on construction projects.
2.7.7 Causes of schedule overruns by external factors

The results from Theodore (2009), below, agree with the studies by Wei (2010:44), Assaf and
Al-Hejji (2006:352) and Sambasivan and Soon (2007:522) where effects of subsurface and
ground conditions was identified and ranked as the major external factor that cause schedule
overruns on construction projects. Further, Le-Hoai, Lee and Lee (2008:370) found that the
major causes of schedule overruns related to external factors include the following:
unforeseen site conditions; price fluctuations; bad weather and obstacles from governments.
Furthermore, Further, Alwi and Hampson (2003:4) showed that site condition; weather and
damage by other participants are the major causes of schedule overruns caused by external
factors.
18
Theodore (2009) identified the following causes of schedule overruns cause by external
factors:
2.8
Effects of subsurface and ground conditions;
Delay in obtaining permits from municipality;
Weather effect on construction activities;
Traffic control and restriction at job site;
Accident during construction;
Changes in government regulations and laws;
Delay in providing services from utilities;
Delay in performing final inspection and certification (Theodore, 2009).
TYPES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS
There are a number of activities which, when not managed properly, can lead to schedule
overrun in the construction industry worldwide. According to Wie (2010:5) the classification
of schedule overruns is dependent upon the type and magnitude of the effect that an activity
will have on the project and who is responsible for the overrun among the stakeholders.
This research adopts a more comprehensive categorises of schedule overruns as outlined
below and discussed in detail in the subsequent session:
I.
Critical or non-critical
II.
Excusable or non-excusable
III.
Compensable or non-compensable
IV.
Concurrent or non-concurrent
2.8.1 Critical Versus Non-Critical schedule overruns

Theodore (2009:25) says that schedule overruns that affect the project completion time or
date are considered as critical delays. Schedule overruns that do not affect the project
completion time or date are non-critical overruns. If certain activities are delayed in the
construction project life cycle, the project completion date will be delayed. Determining
which activities truly control the project completion date depends on the following:
a.
The project itself;
b.
The contractors plan and schedule (particularly the critical path);
c.
The requirement of the contract for sequence and phasing;
19
d.
The physical constraint of the project, i.e. how to build the job from a practical
perspective.
2.8.2 Excusable versus non-excusable schedule overruns

Behboudi (2009:16) states that excusable schedule overruns are caused by owners actions or
responsibilities, hence, a contractor is entitled to extension of time. Whereas, non-excusable
schedule overruns are caused by the contractors actions or responsibilities and the client is
compensated. Theodore (2009:25) studies that all schedule overruns are either excusable or
non-excusable. An excusable overrun is one that is due to an unforeseeable event beyond the
contractors or the subcontractors control. Saleh, Abdelnaser and Abdul (2009:267) write
that excusable schedule overruns are caused by third parties or incidents beyond the control
of both the owner and the contractor. Schedule overruns resulting from the following events
would be considered excusable: General labour strikes; fires; floods; acts of God; ownerdirected changes; errors and omissions in the plans and specifications; differing site
conditions or concealed conditions; unusual severe weather; intervention by outside agencies
and lack of action by government bodies (Theodore, 2009:25).
Saleh, Abdelnaser and Abdul (2009:267) states that non-excusable schedule overruns are
caused solely by the contractor or its suppliers. The contractor is generally not entitled to
relief and must either make up the lost time through acceleration or compensate the owner.
Non-excusable delays are events that are within the contractors control or that are
foreseeable. These are some examples or non-excusable delays are: late performance of subcontractors, untimely performance by suppliers and faulty workmanship by the contractor or
sub-contractors (Theodore, 2009:25).
2.8.3 Compensable versus non-compensable schedule overruns

The work of Mohammed and Isah (2012:789) established that non-compensable schedule
overruns are caused by third parties or incidents beyond the control of both the owner and the
contractor where the contractor is normally entitled to a time extension but no compensation
for the overrun damages. Compensable schedule overruns are caused by the owner or the
owner's agents. A compensable schedule overrun is a delay where the contractor is entitled to
a time extension and to additional compensation such as payment for the overrun. Relating
back to the excusable and non-excusable schedule overruns, only excusable overruns are
compensable. Saleh, Abdelnaser and Abdul (2009:267) states that compensable schedule
20
overruns are caused by the owner or the owner's agents. An example of this would be the late
release of drawings from the owner's architect.
Non-compensable schedule overruns mean that although an excusable overrun may have
occurred, the contractor is not entitled to any additional compensation resulting from the
excusable schedule overrun (Theodore, 2009:25).
2.8.4 Concurrent schedule overruns

Rider and Long (2013:2) defines concurrent schedule overruns as two or more parallel and
independent overruns to the critical path of a project. Concurrent schedule overruns can be on
the same critical path or on parallel critical paths.
Figure 2.1: Types of schedule overruns

Source: (Theodore, 2009)
Figure 2.1 summarises the types of construction projects schedule overruns. The figure
illustrates that there are two different types of excusable schedule overruns and these are
compensable excusable schedule overruns and non-compensable schedule overruns.
Compensable excusable schedule overruns are overruns that are beyond the control of the
contractor, however, they are within the control of the owner hence the contractor is entitled
to compensation. Non-compensable excusable schedule overruns are beyond the control of
21
both the contractor and the owner, hence no compensation is due to any party. Figure 2.1
further illustrates that the second type of schedule overruns is non-excusable overruns. Nonexcusable schedule overruns are within the control of the contractor, hence the owner may be
entitled to compensation.
2.9
EFFECTS OF SCHEDULE OVERRUNS
Effects of schedule overruns are the consequences that will occur when the causes of
schedule overruns are not identified and worked on effectively. Pourrostam and Ismail
(2011:454) identify and rank the effects of construction project schedule overruns as follows;
1. Time overrun: When the stipulated completion time is pushed forward, the project is
said to have experienced schedule overrun (Sunjka and Jacob, 2013:7). Schedule
overrun refers to the late completion or late delivery, from the time specified or
agreed by all parties of the construction project. The main causes for the schedule
overrun are financial problems, late payments for the completed work and on-going
work, change orders, organizational changes etc. (Haseeb et al, 2011:34).
2. Cost overrun: When a project is completed at a cost higher than what was budgeted,
it is said to experience a budget overrun (Sunjka and Jacob, 2013:7). Ramabodu and
Verster (2010) cited in Kikwasi (2012:54) identify critical factors that cause cost
overruns in construction projects as changes in scope of work on site, incomplete
design at the time of tender, contractual claims (extension of time with cost), lack of
cost planning and monitoring of funds, delays in costing variations and additional
works. These critical factors in turn are the delay factors. According to Pourroustam
and Ismail (2011), cost overruns can be traced back to root causes that are often
associated with the preliminary phases, project planning or design, that such root
causes include; poor estimation of quantities, design variations or errors, project
schedule changes, scope changes, unexpected site conditions, rising costs of materials
and labour (largely due to inflation), and or unforeseen events. Pourroustam and
Ismail (2011:450) identify the following as the causes of cost overruns; increase in
cost of labour, working force, materials and equipment and other factors. The main
causes of the cost overrun are change orders, mistakes in the contract, changes in
drawings etc. (Haseeb et al, 2011:34).
22
3. Dispute and Claims: Disputes and claims arise because of the losses incurred
through schedule overruns (Sunjka and Jacob, 2013:7). Disputes normally come down
in assessing three aspects of overruns: whose fault was it or who caused the overrun,
how much delay occurred and, consequently, what monetary awards should be made
(Ahmed et al, 2002:12). The Critical Path Method is primarily useful in addressing
the second of these conditions and in some cases can be used to assist in determining
at least a portion of the monetary awards (Ahmed et al, 2002:12). The main causes of
disputes are slow or late payments for completed or ongoing work, client interference,
neighbor issues, change in requirements, distribution of work, less communication
within parties, subcontractor issues etc. (Haseeb et al, 2011:34).
4. Arbitration: the study by Sunjka and Jacob (2013:7) states that projects would have
extra costs and time consequences related to the engagement of professional
arbitrators in cases of disputes that go through arbitration.
5. Litigation: Disputes, due to schedule overruns, can lead to court cases for resolution
especially when large penalties are at stake (Sunjka and Jacob, 2013:7). Haseeb et al
(2011:34) defines litigation as negotiations and going to court to solve the problems
and it takes a long time to solve the problems. The main causes are late or no
payments for completed work or on-going work and change orders (Haseeb et al,
2011:34).
6. Total project abandonment: schedule overruns in project execution could lead to

total abandonment if issues leading to the overruns are not resolved timeously (Sunjka
and Jacob, 2013:7). The study of Haseeb et al (2011:34) refers to the total
abandonment of the construction project as stopping every work or suspending the
project for a long time. The main causes of abandonment are organizational changes,
regulatory changes, finances and payments and natural disasters. Many large
construction projects are temporarily or permanently abandoned due to financial
crisis, natural disasters and organizational changes (Haseeb et al, 2011:34).
These findings are in general agreement with the studies done by Aibinu and Jagboro
(2002:595) and that by Motaleb and Kishk (2010:1155). However, Denini (2010:182)
identified thirteen effects that come with schedule overruns, these include: cost overrun; time
23
overrun; contractual disputes; decrease in the owner's financial commitment; acceleration;

claims; reduction in quality; negative social impacts; reduction in safety; litigation;
arbitration; contract termination and total project abandonment. Saleh, Abdelnaser and Abdul
(2009:270) write that construction schedule overruns have the following Impacts on
construction projects: loss of interest by the stakeholder; blacklist by authorities; waste of
money and time and declination of reputation. Further, Sunjka and Jacob (2013:7) identified
a total of eight effects of schedule overruns and tabulated them as follows; Time overrun:
When the stipulated completion time is pushed forward, the project is said to have
experienced time overrun; Budget overrun: When a project is completed at a cost higher than
what was budgeted, it is said to experience a budget overrun; Poor quality completed project:
inferior workmanship and or inferior quality materials, can lead to issues of project quality;
Bad Public Relations: When projects are delayed, contractors, consultants and clients could
put their public reputations at risk; Litigation: Disputes can lead to court cases for resolution
especially when large penalties are at stake; Arbitration: The project will have extra cost and
time related to the engagement of professional arbitrators; disputes and claims: Disputes and
claims arise from the losses incurred through delays by either party in the contract; and total
abandonment: Delays in project execution could lead to total abandonment if issues leading
to the delays are not resolved timeously. Kikwasi (2012:54) identified fourteen effects of
delays in Tanzania and ranked them as follows; time overrun, cost overrun, negative social
impact, idling resources, disputes, arbitration, delaying by the client to return the loans, poor
quality of work due to hurrying the projects, delaying in getting profit by clients, bankruptcy,
litigation, create stress on contractors, total abandonment and acceleration losses.
2.10
METHODS OF MINIMISING CONSTRUCTION SCHEDULE OVERRUNS
Wei (2010:18) illustrates that when construction schedule overrun occurs, there is no
question that the owner suffers financially. But the extent to which the owner can recover loss
of income from the contractor, and more importantly minimise the risk that such overruns
will occur, depends largely on how the construction contract is drawn up.
Tabish and Jha (2011):66) identify five successful criterions that can be used to deliver
construction projects within schedule. The study further revealed that there are independent
measures that can be taken in each category to reduce schedule overruns. These criteria are as
follows: schedule performance criterion, cost performance criterion, quality performance
criterion, safety performance criterion and no-dispute performance criterion (Tabish and Jha,
2011:67).
24
Aiyetan, Smallwood, and Shakantu (2011:25) identified twelve factors that would influence
project delivery time, these includes: construction planning and control techniques;
management style; economic policy; the quality of management during construction; site
access conditions; site ground conditions; motivation of workers, constructability of designs;
socio and political conditions; client understanding of the design;
procurement and
construction processes; the quality of management during design; and physical environmental
conditions. Saleh et al. (2009:270) reveal that construction schedule overruns can be
mitigated by applying the flowing factors on construction projects: making risk management;
proper planning; proper payment from client; prepare insurance claims; good scheduling
programme; client representative for project; selecting expert understand their assignment;
clear contract and BOQ and compute the amount of financial damages.
Wei (2010:57) identify fifteen ways of minimising schedule overruns and ranks them as
follows;
1.
Site management and supervision.
2.
Effective strategic planning.
3.
Clear information and communication channels.
4.
Collaborative working in construction.
5.
Proper project planning and scheduling.
6.
Frequent coordination between the parties involved.
7.
Complete and proper design at the right time.
8.
Use appropriate construction methods.
9.
Accurate initial cost estimates.
10.
Proper material procurement.
11.
Proper emphasis on past experience.
12.
Frequent progress meeting.
13.
Compressing construction durations.
14.
Use proper and modern construction equipment.
15.
Use up-to-date technology utilization.
This study adopted these ways, as they were more comprehensive factors that can minimise
construction project schedule overruns. These measures of minimising construction schedule
overruns are in agreement with the study by Majid L.A. (2002), where these measures were
identified as the most effective ways of reducing construction project schedule overruns.
25
2.11
LESSONS LEARNT
The literature reviewed in this chapter showed that the major causes of cost overruns include
the following: Technical incompetence, poor organizational structure, and failures of the
enterprise; lack of cost reports during construction stage; inadequate project preparation,
planning and implementation; delays in issuing information to the contractor during
construction stage; lack of coordination at design phase; change in the scope of the project, in
Government policies; some tendering manoeuvres by contractors, such as front- loading of
rates; incomplete design at the time of tender; bad allocation of labour inside the site and
delays in decisions making by Government, failure of specific coordinating were the top ten
identified causes of cost overruns. The effects of construction project cost overruns were also
identified in the literature and they include the following: delays; supplementary agreement;
additional cost, budget short fall; adversarial relationship between participants of the project;
loss of reputation to the consultant, the consultant will be viewed as incompetent by project
owners; high cost of supervision and contract administration for consultants; delayed
payments to contractors; the contractor will suffer from budget short fall of the client; poor
quality workmanship and dissatisfaction by project owners and consequently by end users
were the top ten effects of cost overruns.
The study further identified the following as the measures that can be used to minimise cost
overruns: Adequacy of funding; adequacy of plans and specifications; budget updates;
constructability; economic risks; owner's involvement and frequent feedback; owner's
commitment to established schedules and budget; project manager commitment and
involvement; project manager competency and experience; realistic obligations and clear
objectives and risk identification and management.
The literature further revealed that the causes of schedule overruns can be categorised into
seven groups namely: owner related, contractor related, consultant related, material related,
equipment related, labour related and causes by eternal factors. Further, literature showed that
there in independent causes of schedule overruns in each of the seven groups. In the owner
related category of schedule overruns, Delay in progress payments by owner were identified
by most scholars as the major cause of schedule overruns associated with the client.
Furthermore, in the contractor related category, delays in sub-contractors work was
identified as the major cause of schedule overruns. The study found that poor contract
management was the major cause of schedule overruns by consultants. However, late
26
approval of changes in the scope of works by consultants and late delivery of materials to site
showed to be the major cause of schedule overruns related to materials. Additionally, in the
equipment related causes of schedule overruns, equipment breakdowns was identified as the
major cause of schedule overruns. Labour supply and effects of subsurface and ground
conditions were identified by the scholars as the major causes of schedule overruns in the
labour related category and causes of schedule overruns by external factors category
respectively.
Literature identified a total of fourteen effects of schedule overruns of construction projects

namely; time overrun, cost overrun, negative social impact, idling resources, disputes,
arbitration, delaying by the client to return the loans, poor quality of work due to hurrying the
projects, delay in getting profit by clients, bankruptcy, litigation, create stress on contractors,
total abandonment and acceleration losses as evidenced in the study of. Finally, the following
were noticed to be the top ten measures of minimising schedule overruns: Site management
and supervision; effective strategic planning; clear information and communication channels;
collaborative working in construction; proper project planning and scheduling; frequent
coordination between the parties involved; complete and proper design at the right time; use
appropriate construction methods; accurate initial cost estimates and proper material
procurement.
2.12
CHAPTER SUMMARY
From the review of literature in this section, it was found that construction project cost and
schedule overruns impact negatively on the construction industry and the economy of any
country with devastating implications such as extension on time, cost overruns, disputes and
claims and can eventually lead to total abandonment of construction projects. The next
chapter reviews literature related to cost and schedule overruns in Malaysia.
27
CHAPTER THREE
CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS IN
MALAYSIA
3.0
This chapter gives a theoretical review and conceptual perspective of construction projects
cost and schedule overruns in the Malaysian construction industry. Previous theories of
construction projects cost and schedule overruns in Malaysia, such as causes of cost and
schedule overruns, effects of cost and schedule overruns and measures of minimising cost
and schedule overruns in the Malaysian construction industry are discussed in this chapter.
However, very few or no studies have been done with regards to effects of cost overruns.
3.1
THE MALAYSIAN CONSTRUCTION INDUSTRY
The construction industry is one of the main contributors towards the development of nations,
providing the necessary infrastructure and physical structures for activities such as
commerce, services and utilities (Papargyropoulou, Preece, Padfield and Abdullah, 2011:2).
The overview on Malaysian construction sector report (2012:8) states that the Malaysian
construction sector is divided into four subsectors; residential, non-residential, civil
engineering and special trade works. Special trade works refer to mainly maintenance
activities such as electrical, tiling, plumbing, painting and carpentry. The report further
revealed that since the 1990s, the construction sector in Malaysia has undergone a series of
ups and downs. In the period of 1989 to 1997, the construction sector registered a
commendable growth of 14.3% vis--vis economic growth of 9.2%. The boom was caused by
the implementation of several large-scale projects such as the Kuala Lumpur International
Airport, Petronas Twin Towers, Sepang International Circuit and the development of
Putrajaya and Cyberjaya which today stand as the countrys famous iconic buildings.
Furthermore, after this boom period, from 2000 to 2006, the number of construction projects
went down tremendously as most of the large-scale projects had been completed and
contractors were going through a difficult time particularly after the Asian Financial Crisis,
during this time, the construction sector grew marginally by 0.7%. However, construction of
new infrastructure projects between the years 2007 to 2011 resulted in an average growth rate
28
of 5.9%. During this period, the country saw many developments in the rail, road and housing
sectors. The Governments stimulus package implemented during 2008/2009 also played an
important role in reviving the construction industry and subsequently the economy as a
whole.
The overview on Malaysian construction sector report (2012:8) further revealed that the year
2011 also saw recovery in the residential and non-residential sectors. The public civil
engineering projects moderated as compared to the private projects. Private sector
construction activities have increased especially in the area of LNG regasification (oil and
gas) and the development of oil terminal. Other activities that supported the growth of the
construction sector included upgrading, repair and maintenance works of public buildings,
construction of rural roads and works on improving the rural basic infrastructure. Due to
favourable business activities and increased consumer spending, there was also demand for
retail spaces, thus the number of shopping complexes and hotels also increased during this
period. The Malaysian construction industry further expanded strongly in 2012 by 18.9% in
the first half of the year supported by strong activities in the residential and civil engineering
subsectors. The future of the sector is foreseen to be robust given many construction projects
in the pipeline (The overview on Malaysian construction sector report, 2012:8).
3.2
COST AND SCHEDULE OVERRUNS IN MALAYSIA
The problem of overruns in the construction industry is a global phenomenon and the
construction industry in Malaysia is no exception (Sambasivan and soon, 2006:1). The
construction industry is a highly dynamic sector and plays very important role in the
development of any country and hence in Malaysia, construction industry started a rapid
growth since its independence. However, the construction industry in Malaysia is facing
chronic problems including poor performance of time and cost, construction waste, poor
productivity and over dependent of foreign workers. Of these challenges, poor time and cost
performance is considered as a critical issue (Memon, Rahman and Azis, 2012:45). Cost and
schedule overruns problems significantly affect the final prices of construction projects. This
trend of overruns in construction projects has become a global concern, it also has negative
impacts on low or middle class people in achieving the basic need for prosper life like house
(Memon and Rahman, 2013:78).
29
Like other countries, the construction industry in Malaysia also faces a lot of challenges such
as delays in the completion of projects on 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 (Memon,
Rahman and Azis, 2011:1).
3.3
CAUSES OF PROJECT COST OVERRUNS IN MALAYSIA
Causes of cost overruns on construction projects are those factors that lead to an overrun in
the original budget. The study by Rahman, Memon and Abd. Karim (2013:290) identified the
following as the top ten causes of cost overruns in large construction projects in Malaysia:
fluctuation of prices of material; cash flow and financial difficulties faced by the contractor;
poor site management and supervision; lack of experience; schedule delay; inadequate
planning and scheduling; incompetent subcontractors; mistakes and errors in design; frequent
design changes and poor financial control on site. Ali and Kamaruzzaman (2010:112) discuss
the following as the major causes of construction project cost overruns in Malaysia:
inaccurate or poor estimation of original cost; inflation of project costs; improper planning;
fluctuation in price of raw materials; poor project management; lack of experience; obsolete
or unsuitable construction equipment and methods; unforeseen site conditions; mistake in
design; insufficient fund; poor contract management; high cost of machineries and
construction cost underestimation. These results were not in agreement with the results of
Memon el al (2011:65) where poor design and delays in design; unrealistic contract duration
and requirements imposed; lack of experience; late delivery of materials and equipment;
relationship between management and labour; delay in preparation and approval of drawings;
inadequate planning and scheduling; poor site management and supervision; mistakes during
construction and changes in material specification and type were identified as the top causes
of cost overruns in the Malaysian construction industry. Furthermore, Memon et al. (2012:48)
revealed that design and documentation issues; financial resource management; project
management and contract administration; contractors site management; information and
communication technology; material and machinery resource; labour (human) resource and
external factors as the major factors affecting cost performance on construction projects.
30
3.4
MEASURE OF MINIMISING PROJECTS COST OVERRUNS IN MALAYSIA
When all the causes of cost overruns have been identified and understood into details, it is
now necessary to identify the measures of mitigating these costs and schedule overruns.
Memon et al, (2012:50) identified the following as the measures of mitigating cost overruns
in Malaysia: effective strategic planning; proper project planning and scheduling; effective
site management and supervision; frequent progress meeting; proper emphasis on past
experience; use of experienced subcontractors and suppliers; use of appropriate construction
methods; use up to date technology utilization; clear information and communication
channels; frequent coordination between the parties; perform a preconstruction planning of
project tasks and resources needs; developing human resources in the construction industry;
comprehensive contract administration; systematic control mechanism and improving
contract award procedure by giving less weight to prices and more weight to the capabilities
and past performance of contractors (Memon et al, 2012:50). The study by Ali and
Kamaruzzaman (2010:113) discuss the following as the measures of minimising cost
overruns on construction projects: proper project costing and financing; competent personnel;
appropriate scope definition; proper cost control; risk management during project execution;
appropriate contractual framework; increase supply of materials; realistic cost estimation and
efficient management.
Azis, Memon, Rahman and Abd. Karim (2013:2625) identified fifteen measures of mitigating
construction cost overruns and ranked them as follows; effective strategic planning; proper
project planning and scheduling; effective site management and supervision; frequent
progress meeting; proper emphasis on past experience; use of experienced subcontractors and
suppliers; use of appropriate construction methods; use up to date technology utilization;
clear information and communication channels; frequent coordination between the parties;
perform a preconstruction planning of project tasks and resources needs; developing human
resources in the construction industry; comprehensive contract administration; systematic
control mechanism and improving contract award procedure by giving less weight to prices
and more weight to the capabilities and past performance of contractors.
31
3.5
CONSTRUCTION PROJECT SCHEDULE OVERRUNS IN MALAYSIA
The problem of schedule overruns in the construction industry is a global phenomenon and
the construction industry in Malaysia is no exception (Sambasivan and Soon, 2007:517).
Schedule overruns on construction projects is a situation where the project cannot be
completed under the planned time. It is a common issue faced in the construction industry all
over the world especially in developing countries. In the Malaysian construction industry,
17.3% of construction projects experience more than 3 months schedule overrun and some of
them are abandoned (Ali, Smith, Pitt and Choon, 2012:10). Schedule overrun can be defined
as late completion of works as compared to the planned schedule or contract schedule. It
occurs when the progress of a contract falls behind its scheduled program. It may be caused
by any party to the contract and may be a direct result of one or more circumstances (Memon
et al, 2012: 46).
Abedi, Fathi and Mohammad (2011:3) states that projects success is basically to gain the
project objectives that are classically defined by the need to complete a project on time,
within the budget, and with appropriate quality. Hence any disruptions to the project
objectives will certainly contribute to project schedule overrun with its specified adverse
effects on project objectives. Delays can give rise to disruption of work and loss of
productivity, late completion of project, increased time related costs and third party claims
and abandonment or termination of contract.
3.6
CAUSES OF CONSTRUCTION PROJECTS SCHEDULE OVERRUNS
Ramanathan, Narayanan and Idrus (2012:51) revealed one hundred and thirteen factors that
can lead to schedule overruns with the top ten factors being: slow payment for completed
works; contractor financial difficulties; cash problems during construction; inflation;
financial difficulties to owner; necessary variations of works; obsolete technology;
unsatisfactory site compensation; lack of involvement through project life and incompetence
project team. However, Ali, Smith, Pitt and Choon (2012):10) show that labour shortage;
contractors financial difficulties; construction mistakes and defective works; coordination
problem; material shortage and poor site management are the major factors that contribute to
schedule overruns con construction projects in Malaysia. Furthermore, Memon et al.
(2012:48) revealed that design and documentation issues; financial resource management;
project management and contract administration; contractors site management; information
32
and communication technology; material and machinery resource; labour (human) resource
and external factors as the major factors affecting time performance on construction projects.
The study by Pourrostam and Ismail (2011:453) shows the following as the top ten causes of
schedule overruns in Malaysia: poor site management; delay in progress payments by client;
change orders by client during construction; ineffective planning and scheduling of project by
contractor; financial difficulties by contractor; slowness in decision making process by client;
delays in producing design documents; late in reviewing and approving design documents by
client; poor contract management by consultant and problems with subcontractors.
Alaghbari, Kadir, Salim, Ernawati (2007) categorised causes of schedule overruns into four
categories namely; owner related causes, consultant related causes, contractor related causes
and external factors causes of schedule overruns. The study ranked the causes of schedule
overruns in each of the categories as follows: contractor related causes of schedule overruns,
owner related causes of schedule overruns, consultant related causes of schedule overruns
and causes of schedule overruns by external factors (Alaghbari et al., 2007:200). The study of
Alaghbari et al. (2007:202) further combined the above categories and arrived at the
following as the top ten causes of schedule on construction projects: Financial difficulties and
economic problems; financial problems; supervision too late and slowness in making
decisions; slow to give instructions; lack of materials on market; poor site management;
materials shortages on site; construction mistakes and defective work; delay in delivery of
materials to site; slowness in making decisions; lack of consultants experience and
incomplete documents.
3.7
EFFECTS OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS
Ali et al (2012: 11) revealed that the effects construction projects schedule overruns in
Malaysia include: cost overrun; extension of time (E.O.T); late payment; rescheduling; affect
company reputation and lost productivity and efficiency. However, Pourrostam and Ismail
(2011:454) reveal that time overrun is the number one effect that is encountered when
schedule overruns occur. The study further ranks and shows that time overrun; cost overrun;
disputes; arbitration; litigation and total abandonment of projects are the major effects of
construction projects schedule overruns. These findings agree with the findings from the
study done by Sambasivan and Soon (2006:523). Wei (2010:55) studied and ranked effects of
schedule overruns in Malaysia as follows: time overrun; cost overrun; disputes; litigation;
total abandonment of projects and arbitration.
33
3.8
There are many factors that contributed to causes of schedule overruns in construction
projects. These range from factors inherent in the technology and its management, to those
resulting from the physical, social, and financial environment. Schedule overruns can give
rise to disruption of work and loss of productivity, late completion of project, increased time
related costs and third party claims and abandonment or termination of contract. Schedule
overruns are costly and often result in disputes and claims. Hence, the need to identify the
mitigation measures that will lead to timely delivery of construction projects (Abedi, Fathi
and Mohammad, 2011:3).
The study by Memon et al, (2012:50) outlined the following to be the most effective ways of
minimising schedule overruns in Malaysia: proper planning work; committed leadership and
management; send clear and complete message to worker to ensure effective communication;
hire skilled workers to achieve good progress, avoid poor quality of work, more rectification
and double handling; close monitoring; training and development of all participants to
support delivery process; focus on the quality, cost and delivery of the project; use new
construction technologies; adoption of tools and techniques like value management, lean
thinking, total quality management; provide knowledge/training to unskilled workers based
on their scope of work; fully utilize the construction team; focus on clients need and measure
performance against other projects. However, these findings are similar to those identified by
Wei (2010:57) with the following being the top ten measures of minimising schedule over
runs on construction projects in Malaysia: site management and supervision; effective
strategic planning; clear information and communication channels; collaborative working in
construction; proper project planning and scheduling; frequent coordination between the
parties involved; complete and proper design at the right time; use appropriate construction
methods; accurate initial cost estimates; and proper material procurement.
Abedi, Fathi and Mohammad (2011:5) identified thirty measures that can be taken to
minimise construction schedule overruns in Malaysia: accurate initial cost estimates;
adopting a new approach to contract award procedure by giving less weight to prices and
more weight to the capabilities and past performance of contractors; perform a
preconstruction planning of project tasks and resource needs; selection of a competent
consultants and reliable contractors to carry out the work; allocation of sufficient time and
money at the design phase; availability of adequate resources; commitment to projects;
34
competent project managers; comprehensive contract documentation; ensure adequate and

available source of finance until project completion; frequent progress meetings and
enforcing liquidated damage clauses. Other factors of minimising schedule overruns
identified by Abedi, Fathi and Mohammad (2011: 6) include: offering incentives for early
completion; hire an independent supervising engineer to monitor the progress of the work;
multidisciplinary and competent project team; use up-to-date technology utilization; absence
of bureaucracy; accurate initial time estimates; adopting new approaches to contracting such
as design-build and construction management (CM) type of contracts; awarding bids to the
right and experience consultant and contractor; clear information and communication
channels; developing professional and skilful of human resources in the construction industry
through proper training and classifying of craftsman; effective strategic planning; ensuring
timely delivery of materials; proper emphasis on past experience; community involvement;
systematic control mechanism; acceleration of site activities and contingency allowance.
3.9
LESSONS LEARNT
Literature reviewed showed that there are a number of factors that causes construction
projects cost overruns in Malaysia. These factors include: improper planning; fluctuation in
price of raw materials; poor project management; lack of experience; late delivery of
materials and equipment; delay in preparation and approval of drawings; financial resource
management; project management and contract administration; contractors site management;
information and communication technology; material and machinery resource and slowness
by supervisors in giving instructions among others. Literature further showed that there are
numerous factors that can help minimise construction project cost overruns in Malaysia.
These included: proper project planning and scheduling; effective site management and
supervision; frequent progress meeting; proper emphasis on past experience; use of
experienced subcontractors and suppliers; use of appropriate construction methods; up to date
technology utilization; clear information and communication channels and frequent
coordination between the parties to name but a few.
Furthermore it was revealed that there are a number of factors that causes schedule overruns
on construction projects in Malaysia. These included: labour shortage; contractors financial
difficulties; construction mistakes and defective works; coordination problem; slowness in
decision making process by client; delays in producing design documents; late in reviewing
and approving design documents by client; poor contract management by consultant and
35
problems with subcontractors among others. Scholars further showed that these schedule
overruns have devastating effects on projects such as time overrun; cost overrun; disputes;
arbitration; litigation and total abandonment of projects. Literature further showed that there
are numerous factors that can help minimise construction project schedule overruns in
Malaysia, these include: selection of a competent consultant and a reliable contractor to carry
out the work; allocation of sufficient time and money at the design phase; availability of
resources; commitment to projects; competent project managers and comprehensive contract
documentation.
3.10
CHAPTER SUMMARY
This chapter discussed the cost and schedule overruns in the Malaysian construction industry.
Literature showed that construction project cost and schedule overruns impact negatively on
the construction industry and the economy of Malaysia with devastating implications such as
extension of time, cost overruns, disputes and claims and can eventually lead to total
abandonment of construction projects. The next chapter reviews literature related to cost and
schedule overruns in Nigeria.
36
CHAPTER FOUR
CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS IN NIGERIA
4.0
This chapter will present the concept of cost and schedule overruns in Nigeria. This chapter
gives a theoretical review and conceptual perspective of construction projects cost and
schedule overruns in the Nigerian construction industry. Previous theories of construction
projects cost and schedule overruns in Nigeria, such as causes of cost and schedule overruns,
effects of cost and schedule overruns and measures of minimising cost and schedule overruns
in the Nigerian construction industry are discussed in the chapter. However, very few or no
studies have been done with regards to effects of cost overruns.
4.1
THE NIGERIAN CONSTRUCTION INDUSTRY
The building and construction industry in Nigeria is a fast growing sector of the economy
which recorded a growth rate of more than 20% between 2006 and 2007. This growth has,
however, not been commensurate with the growth of Nigerias total GDP as the overall
contribution of the construction sector to the countrys GDP remains very low at 1.83% in
2008 (Adelekan, 2013:2). However, the contribution of the construction industry to national
economic growth necessitates improved efficiency in the industry by means of costeffectiveness and timelines and would certainly contribute to cost savings for the country as a
whole (Aibinu and Jagboro, 2002:593). Adelekan (2013:2) states that the real estate sector in
Nigeria comprises two main segments- residential and non-residential. The residential real
estate segment accounted for 93.3% of real estate construction in the country in 2008, while
the non-residential real estate sector was distributed among commercial 4.6%, industrial 0.5%
and others were 1.6% for roads, bridges, ports and airports etc. Three areas of significant
growth in building and construction activities in Nigeria are included Lagos, the commercial
nerve-centre of the country; Abuja, the Federal Capital Territory which has witnessed a major
rise in construction activities in the past decade, especially as population influx into the city
has necessitated expansion into new towns and the Niger-Delta region, base of Nigerias oil
industry.
37
4.2
CONSTRUCTION PROJECTS COST OVERRUNS IN NIGERIA
Ubani, Okorocha and Emeribe (2013:73) state that the successful execution of construction
projects and keeping them within estimated cost and prescribed schedules depend on a
methodology that requires sound engineering judgments. Many projects experience extensive
delays, exceed initial time schedule and cost estimate to the dislike of clients, contractors and
consultants. This problem is more evident in the traditional and public sector type of projects
in where contract are awarded to the lowest bidder. This is the contract awarding strategy of
the majority of public projects in developing countries including Nigeria.
The construction industry in Nigeria is of paramount importance for employment and
economic growth, Therefore, efforts geared towards improving construction efficiency by
means of cost-effectiveness and timeliness would be worthwhile and certainly contribute to
cost savings for the country as a whole (Ogunsemi and Jagboro, 2006:253). The major
challenges facing the construction industry in developing countries like Nigeria is the chronic
problem of cost and schedule overruns (Kasimu, 2012:775).
4.3
CAUSE OF PROJECTS COST OVERRUNS IN NIGERIA
Causes of cost overruns are those factors that make the projects costs exceed the originally
budgeted cost. Eshofonie (2008:32) revealed a total of forty causes of cost overruns in
Nigeria, with the top ten causes being the following: cost of materials; incorrect planning;
wrong method of estimation; contract management; fluctuation of prices of materials;
previous experience of contractor; absence of construction cost data; additional cost and
project financing. However, the study of Ameh, Soyingbe and Odusami (2010:61) identified
factors that cause cost overruns, these factors were then categorised in five categories
namely:
Environmental Factors: Economic stability; inadequate production of raw materials

by the country; government policies (laws and regulations); domination of
construction industry by foreign firms and aids; project location; absence of
construction cost data; suppliers manipulation; lack of productivity standards in
Nigeria; level of competitors; effects of weather; number of competitors; social and
cultural impacts; number of construction projects going on at the same time and
nationality of labour (Ameh et al, 2010:61). However, Kasimu (2011:778) shows that
the environmental factors include: location of projects; weather condition; terrain of
site condition; suppliers manipulation; level of competition; lack of historical cost
38
data; material fluctuation; soil and land stability; social and cultural impacts and law
and regulations.
Construction Factors: Lack of contractor experience; incorrect planning; poor

financial control on site; disputes on site; lack of coordination between designers and
contractors and relationship between management and labour (Ameh et al, 2010:61).
Further, Kasimu (2011:778) states that construction related factors of cost overruns
are: personal experience in the contract works; poor financial management and
control; improper coordination and interaction within parties involved in works; lack
of qualify project manager; lack of application of risk management process;
knowledge of clients and consultant play a crucial; financial status of the client and
government policies.
Construction item factors: Frequent design changes; fraudulent practices and

kickbacks; additional works; contract management; inadequate labour availability;
duration of contract period and contractual procedure (Ameh et al, 2010:62).
However, Kasimu (2011:778) asserts that the construction items related causes of
cost overruns include: insufficient time; incomplete drawings; size of contract; lack of
labour productivity; variations; availability of raw materials; inadequate specification;
lack of availability of equipment and unclear arbitration process.
Cost estimating factors: Cost of materials; fluctuations in the prices of materials;

high interest rates charged by banks on loans received by contractors; high cost of
labour; high cost of machinery; wrong method of estimation; high transportation
costs; long periods between design and time of tendering; waste on site; high cost of
machinery maintenance; insurance cost and bureaucracy in tendering method (Ameh
et al, 2010:62).
Financing factors: Mode of financing, bonds and payments; inflationary pressure

and currency exchange (Ameh et al, 2010:63). Furthermore, Kasimu (2012:778) states
that the major financial related causes of cost overruns include: market conditions;
fluctuations in money exchange; inflation; delay in payment; lack of financial
39
management and planning; method of estimate adopted; high interest rates charges by
banks on loan; taxes increase and insurance cost.
Political factors: Monopoly of material suppliers; difficulties in importing equipment

and materials; political situation; dealing with suppliers and traders and segmentation
of the west bank and limitation of movements between areas (Kasimu, 2012:778).
According to Olawale and Sun (2008:523) the factors that affect schedule on construction
projects in Nigeria include: design changes; inaccurate evaluation of projects time or
duration; complexity of works; risk and uncertainty associated with projects; nonperformance of subcontractors and nominated suppliers; lack of proper training and
experience of project managers; discrepancies in contract documentation; low skilled
manpower; conflict between project parties and unpredictable weather conditions among
others were ranked the top ten factors that cause schedule overruns.
4.4
MEASURE OF MINIMISING PROJECT COST OVERRUNS IN NIGERIA
Measures of minimising projects cost overruns in Nigeria are those steps that can be taken to
remove or reduce the factors that affect cost overruns. The study by Eshofonie (2008:35)
shows the following top ten measures of minimising cost overruns on projects in Nigeria:
Ensuring efficient time management through proper resource planning, duration estimation
and schedule development and control; ensuring adequate site supervisions to minimize poor
quality workmanships and idle times and hiring and motivating experienced and qualified
workforce to improve productivity and quality of workmanship. The others include, selecting
suitable contractors not only on the basis of price and time offerings, but also in experience,
financial standing, capacity and expertise; ensuring realistic estimates through proper
resource cost studies; allowing sufficient time for feasibility studies, design, planning and
tender submission; minimize propensity for late changes by ensuring a holistic assessment of
client real and stated needs; aiming at the economy in design by exploring alternatives and
doing detailed investigations and analyses; ensuring comprehensive articulation and
communication of own and end - user needs and requirements during briefing sessions and
minimize conflicts with subcontractors, which could undermine onsite productivity and
progress of work (Eshofonie, 2008:36)
40
4.5
CONSTRUCTION PROJECT SCHEDULE OVERRUNS
The Nigerian construction industry continues to occupy an important position in the nations
economy even though it contributes less than the manufacturing or other service industries.
The contribution of the construction industry to national economic growth necessitates
improved efficiency in the industry by means of cost-effectiveness and timelines and would
certainly contribute to cost savings for the country as a whole, however, the major criticism
facing the Nigerian construction industry is the growing rate of delays in project delivery
(Aibinu and Jagboro, 2002:593).
4.6
CAUSES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS
Causes of schedule overruns are factors that lead to construction projects not being finished
according to the planned scheduled time at the inception of projects in Nigeria.
Ade-ojo and Babalola (2013:4) state that there are six major causes that would lead to
schedule overruns, the identified causes were ranked as follows: design error; poor site
condition; delay in payment; financial incapability of clients; financial incapability of
contractor and non-availability of subcontractor and supplier. However, Omoregie and
Radford (ND:88) identified the following causes of scheduling overruns using the mean
severity index magnitudes ranking: price fluctuations; financing and payment of completed
works; poor contract management; delays; changes in site conditions; inaccurate estimates;
shortages of materials; use of imported materials and plant items; additional work; design
changes; inexperienced subcontractors and nominated suppliers; weather conditions; non
adherence to contract conditions; mistakes and discrepancies in contract document and
fraudulent practices and kickbacks.
Akinsiku and Akinsulire (2012:28) show that, financial or cash flow difficulties; financial
difficulties faced by contractors and public agencies; frequent change order and design;
failure to pay for completed works; shortages of resources; considerable additional work;
escalations of material prices; increases in the scope of work; delay in design work and late
delivery of materials are the top ten causes of schedule overruns on construction projects. the
other causes of schedule overruns identified by Akinsiku and Akinsulire (2012:28) include:
fluctuations in resources cost; improper financial and payment arrangement; organizational
deficiencies; poor contract management; client initiated variations; resources management
problems; planning and scheduling problem; slowness in decision making by project teams;
inadequate contractor's experience; poor site management and supervision; inaccurate cost
41
estimates; lack of communication; build ability; slowness in preparation and approval of

shop; inclement weather; inaccurate site inspection; unforeseen site conditions; lowest bid
wins system; labour disputes and strikes; poor technical performance and workmanship;
subcontracting systems; liaisons problems among contracting parties and restricted access.
These finding were in agreement with the findings in the work of Ameh and Osegbo
(2011:11) where, inadequate fund for the project; inadequate planning of project before
commencement; inadequate tools and equipment; delay in delivery of materials; design
changes during project execution; subcontractor incompetency; delay in response to decision
taking; incompleteness of technical documentation; variations and labour disputes in the form
of strike or lock-out were identified as the major causes of schedule overruns.
Furthermore, Jonathan (2013:5) identified the following as the major causes of schedule
overruns on construction projects in Nigeria: inadequate fund to finance the project;
ineffective project planning; lack of commitment by the contractors; project management
problem; fluctuation; lack of equipment; change of drawings; non-availability of detailed
drawing from architect; unstable economy; fraud; variations; communal conflict; change of
government; lack of information from consultants; use of sub-standard materials; lack of
manpower; inclement weather and war. The study of Non-Excusable Delay in Lagos Nigeria
by Ibironke, Oladinrin, Adeniyi and Eboreime (2013:65) showed that the major causes of
schedule overruns include: insufficient amount of equipment; inaccurate time estimates;
monthly payment difficulties; change orders; inaccurate cost estimates; poor site management
and supervision; inadequate modern equipment; shortage of construction materials;
incompetent project team; improper planning and scheduling; contractor's financial
difficulties; unreliable subcontractors; labour productivity; frequent equipment breakdown;
late delivery of material; shortage of skilled labour; poor design or delays in design; slow site
clearance; labour supply; slow decision making by client and lack of communication and
coordination.
4.7
EFFECTS OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS
Effects of schedule overruns are the consequences that will occur when the project deadlines
are not achieved. The major effects of time overruns on construction projects in Nigeria are
the following: time overrun; cost overrun; dispute; arbitration; litigation and total
abandonment (Aibinu and Jagboro, 2002:595), these results were in general agreement with
the study done by Jonathan (2013:6). Akinsiku and Akinsulire (2012:29) identified seventeen
42
effects of construction projects schedule overruns and ranked them as follows; extension of
time on the project; cost overruns due to inflation and fluctuations; accumulations of interest
rate on the capital to the project; wastage and under- utilization of manpower resources;
claims on the disturbance of regular progress work by the main contractor; under-utilization
of equipment and plant purchased for the project; loss of confidence in the contract, thereby
jeopardising the reputation of contractor in case of future tendering chances; late returns of
income for private developers; reduction in employment opportunities; dispute between the
parties involved; aids the decrease in tempo of economic activities in the nation; additional
insurance charges; extra taxes and dues due to delay; insolvency of the contractor; inability
to meet the minimum living standard; arbitration and litigation and total abandonment of
projects (Akinsiku and Akinsulire, 2012:29). According to Sunjka and Jacob (2013:7) the
effects of schedule overruns can be defined as follows:
1. Time overrun: When the stipulated completion time is pushed forward, the project is
said to have experienced time overrun (Sunjka and Jacob, 2013:7).
2. Cost overrun: When a project is completed at a cost higher than what was budgeted,
it is said to experience a budget overrun (Sunjka and Jacob, 2013:7).
3. Dispute and Claims: Disputes and claims arise because of the losses incurred
through delays (Sunjka and Jacob, 2013:7).
4. Arbitration: Sunjka and Jacob (2013:7) states that projects would have extra costs
and time related to the engagement of professional arbitrators in cases of disputes that
go through arbitration.
5. Litigation: Disputes, due to delays, can lead to court cases for resolution especially
when large penalties are at stake (Sunjka and Jacob, 2013:7).
6. Total abandonment: Delays in project execution could lead to total abandonment if

issues leading to the delays are not resolved timeously (Sunjka and Jacob, 2013:7).
Furthermore, Ibironke et al (2013:67) identified and ranked the effects of Non-Excusable

schedule overruns as follows:
time overrun; cost overrun; dispute; total abandonment;

43
arbitration and litigation. Ibironke et al (2013:67) further revealed that arbitration, litigation
and alternative dispute resolution (ADR) are the methods of dispute resolution in the
construction industry. ADR is a voluntary process in which the parties are assisted in solving
their disputes by a neutral third party without the need of a judge or arbitrator. ADR
techniques are mediation, conciliation, adjudication and executive tribunal. ADR procedures,
unlike litigation and arbitration, are not binding until a mutually agreed settlement is reached
and put in writing, that is to say, either party can resort to other methods of dispute resolution
if the ADR procedure fails.
4.8
Measures of minimising scheduling overruns are the steps taken to reduce the factors that
cause schedule overruns on construction projects. Ade-ojo and Babalola (2013:4) identify six
measures that can reduce schedule overruns on construction projects, these include: accurate
design; prompt payment; financial capability of client; financial capability of contractor;
favourable site condition; favourable weather and availability of subcontractor and supplier.
Jonathan (2013:7) states that effective project planning; adequate funding to finance project
to completion and ensuring that project parties play their role on project execution are the
most effective ways of reducing schedule overruns on construction projects in Nigeria.
However, Aibinu and Jagboro (2002:597) state that acceleration of site activities and
contingency allowance would reduce schedule overruns on construction projects in Nigeria.
Furthermore, Ibironke et al (2013:68) in a study of measure of minimising Non-Excusable
schedule overruns in Nigeria revealed that the following measures can be used to minimise
schedule overruns: ensuring adequate and available sources of finance; competent project
managers; availability of resources; frequent progress meetings; awarding bids to the right
and experienced consultants and contractors; use of experienced subcontractors and suppliers;
multidisciplinary and competent project team; accurate initial cost estimates; competent and
capable client representatives; use of appropriate construction methods; performing
preconstruction planning of project tasks and resource needs; project management assistance;
adopting new approaches to contracting such as Design-Build and Construction Management
(CM) types of contracts; acceleration of site clearance and allocation of sufficient time and
money at the design phase.
44
4.9
LESSONS LEARNT
Literature reviewed showed that there are a number of factors that cause construction projects
cost overruns in Nigeria. These factors include: cost of materials; incorrect planning; wrong
method of estimation; contract management; fluctuation of prices of materials; previous
experience of contractor; absence of construction cost data design changes; inaccurate
evaluation of projects time or duration; complexity of works; risk and uncertainty associated
with projects; non-performance of subcontractors and nominated suppliers and lack of proper
training and experience of project managers. Literature further showed that there are
numerous factors that can help minimise construction project cost overruns in Nigeria, these
included: Ensuring efficient time management through proper resource planning, duration
estimation and schedule development and control; ensuring adequate site supervisions to
minimize poor quality workmanships and idle times and hiring and motivating experienced
and qualified workforce to improve productivity and quality of workmanship.
Furthermore it was revealed that there are a number of factors that causes schedule overruns
on construction projects in Malaysia, these included: poor contract management; client
initiated variations; resources management problems; planning and scheduling problem;
slowness in decision making by project team; inadequate contractor's experience; poor site
management and supervision; inaccurate cost estimates; lack of communication; lack of
equipment; change of drawings; non-availability of detailed drawing from architect; unstable
economy; fraud and variations. The literature further showed that these schedule overruns
have devastating effects on projects such as time overrun; cost overrun; disputes; arbitration;
litigation and total abandonment of projects. Literature further showed that there are
numerous identified factors that can help minimise construction project schedule overruns in
Nigeria, these include: accurate design; prompt payment; financial capability of client;
financial capability of contractor; favourable site condition; ensuring adequate and available
sources of finance; competent project managers; availability of resources; frequent progress
meetings; awarding bids to the right and experienced consultants and contractors; use of
experienced subcontractors and suppliers; multidisciplinary and competent project team and
accurate initial cost estimates.
45
4.10
CHAPTER SUMMARY
This chapter gave an in-depth discussion of cost and schedule overruns in the Nigerian
construction industry. Literature showed that construction project cost and schedule overruns
impact negatively on the construction industry and the economy of Nigeria with devastating
implications such as extension on time, cost overruns, disputes and claims and can eventually
lead to total abandonment of construction projects. The next chapter reviews literature related
to cost and schedule overruns in selected countries including South Africa.
46
CHAPTER FIVE
CONSTRUCTION PROJECTS COST AND SCHEDULE OVERRUNS: CASE
STUDIES FROM DEVELOPED AND DEVELOPING COUNTRIES
5.0
Chapter 5 gives a theoretical review and conceptual perspective of construction projects cost
and schedule overruns in South Africa, Uganda, Ghana, America and India using case
studies. Previous theories of construction projects cost and schedule overruns, such as causes
of cost and schedule overruns, effects of cost and schedule overruns and measures of
minimising cost and schedule overruns are discussed in this chapter. However, very few
studies have been done with regards to cost and schedule overruns such as effects and
measures of minimising cost and schedule overruns. This chapter will present the concept of
cost and schedule overruns in South Africa, Uganda, Ghana, America and India using case
studies. These will be discussed based on the objective of the study, methodology, findings
and implication of the study.
5.1
THE SOUTH AFRICAN CONSTRUCTION INDUSTRY
The construction industry plays a vital role in South Africa's economy and is a significant
contributor to economic growth in the country (Construction Industry Development Board
[CIDB], 2012). The South African construction industry was particularly hard hit when the
infrastructure development highs leading up to the 2010 FIFA World Cup were followed by a
global recession and depressed growth (PWC, 2013:5). According to the Industry Insight
(2012:23) Investment in the construction sector (including residential, non-residential and
civil construction works) and civil works recorded an increase in the fourth quarter of 2011.
However, the industry recorded a decrease in investment in residential buildings during the
same quarter. However, despite these positives and negatives, the construction industry in
South African faces numerous challenges which have been highlighted in section 5.1.2 of this
chapter.
47
5.1.1 Construction Industry Development Board (CIDB)

According to the Hekima Advisory (2014:3) The CIDB Act established the CIDB in order to
implement an integrated strategy for the reconstruction, growth and development of the
construction industry. There is also recognition, in the CIDB Act, of Governments vision of
a construction industry development strategy that promotes stability, fosters economic growth
and international competitiveness, creates sustainable employment and addresses historical
imbalances as it generates new construction industry capacity.
The objectives of the CIDB Act, 2000 include:
To promote the contribution of the construction industry in meeting national

construction demand and in advancing (i) national, social and economic development
objectives, (ii) industry, performance, efficiency and competitiveness, and (iii)
improved value to clients.
To provide strategic leadership to construction industry stakeholders to stimulate

sustainable growth, reform and improvement of the construction sector.
To promote best practice through the development and implementation of appropriate

programmes and measures aimed at best practice and improved performance of public
and private sector clients, contractors and other participants in the construction
delivery process.
To promote, establish or endorse uniform standards and ethical standards that regulate
the actions, practices and procedures of parties engaged in construction contracts.
To promote sustainable growth of the construction industry and the participation of

the emerging sector therein.
To promote appropriate research on any matter related to the construction industry

and its development.
It is required of the CIDB to keep a national register of contactors to facilitate public

sector procurement and promote contractor development, through the following
measures (CIDB Act, 2000).
To support risk management in the tendering process.
To reduce the administration burden associated with the award of contracts.
To reduce tendering costs to both clients and contractors.
To enable effective access by the emerging sector to work and development

opportunity.
48
To assess the performance of contractors in the execution of contracts and thus

provide a performance record for contractors.
To regulate the behaviour and promote minimum standards and best practice of
contractors.
To store and provide data on the size and distribution of contractors operating within
the industry and the volume, nature, performance and development of contractors and
target groups.
To enable access by the private sector and thus also facilitate private sector
procurement (CIDB Act, 2000).
5.1.2 Challenges facing the South African construction industry

According to Ncwandi and Dangalazana (2005:7) the major challenges in the South African
construction industry include; access and reliable information about contracts and tenders,
ability to develop long-term strategy, ability of small companies to compete with big
construction companies, extensive use of competitive tendering in construction contracts, the
high number of unskilled employees in the company, providing a safe and decent working
environment for workers, high level of defects in the construction, lack of incentives from
government to encourage emerging contractors, lack of professional advisors and consultants
in the construction industry, lack of access to funding from commercial banks and high startup cost. Thwala and Phaladi (2009:199) further assert that the major challenges faced in the
construction industry include; inadequate finance and inability to get credit from suppliers;
inability to employ competent workers; poor pricing, tendering, and contract documentation
skills; poor mentoring; fronting for established contractors; lack of entrepreneurial skills; lack
of proper training; lack of resources for either large or complex construction work; lack of
technical, financial, contractual, and managerial skills; and late payment for the work done.
However, the study by Bowen, Edwards and Cattell, (2012:521) concludes that the biggest
challenge in the South African construction industry is corruption.
Moreover, Windapo and Cattell (2013:73) add that the top five challenges faced in the South
African construction industry are; increases in the costs of building materials, access to
affordable mortgage or credit, high interest rates, high rate of enterprise failure or delivery
capacity and performance and mismatches between available skills and required skills.
Furthermore, Mofokeng and Thwala (2012:718) educates that the major challenges in the
49
construction industry in South Africa include; lack of cash flow,
poor
financial
management, lack of skilled people, weaknesses in the tendering processes and lack of
business management. However, the current study will only focus on the challenges relating
to cost and schedule overruns on construction projects in South Africa.
5.1.3 Cost and schedule overruns in South Africa

Morson, Meinesz, Forman and Gilfillan (2009) state that there is increased public and private
sector infrastructure investment in South Africa, partly due to its hosting of the 2010 FIFA
Soccer World Cup. However, the main reason for the increase was linked to public sector
infrastructure upgrade and private sector capacity expansion for which construction will
continue beyond 2010. A significant part of this investment relates to increased electricity
generating capacity, road upgrading and resource processing capacity.
The construction industry being a prime indicator of economic activity in South Africa, the
industry is often utilised by government not only to stimulate growth but also to assist
economic recoveries from recessions (Baloyi and Bekker, 2013:52). Given the large capital
amounts associated with construction projects, the performance in terms of cost and time are
closely monitored, especially where tax payers money is involved. With the third
traditional measurement criterion for project performance, namely quality, being a more
subjective unit of measure, the quantitative results from measuring against original project
duration estimates and approved budgets remain popular yardsticks for assessing overall
project performance (Baloyi and Bekker, 2013:52). According to Nobane (2012:5) the quest
to rationalise the success and failures of construction projects has led to efforts being put in
place by both the local and international members of the project management and engineering
professionals to uncover the causes of both failure and success of construction projects.
However, the most pertinent question that still arises today is why do projects. The multidimensional answer to this question seems to always direct towards four major factors, that
is, cost, time, quality and project management strategies.
A study by Baloyi and Bekker (2011:53) on the construction of 2010 FIFA world cup stadia
in south Africa revealed that the construction exceeded the budgeted costs on all the stadia as
shown in the table below.
50
Table 2.1: Budgeted versus indicated final costs of the ten FIFA 2010 stadia
Stadium
Initial budgeted cost
Indicated final cost
Soccer City Johannesburg
R 2.2 billion
R 3.7 billion
Ellis Park Johannesburg
R 240 million
R 253 million
Moses Mabida Durban
R 1.6 billion
R 3.1 billion
Mombela Nelspruit
R 600 million
R 1 billion
Green Point Cape Town
R 2.9 billion
R 4 billion
Nelson Mandela Bay Port Elizabeth
R 2.1 billion
Not known
Peter Mokaba Polokwane
R 1.3 billion
Not known
Royal Bafokeng Rustenburg
R 360 million
R 483 million
Mangaung Bloemfontein
R 245 million
R 359 million
Loftus Versfeld Pretoria
R 122 million
R 131 million
Source: Baloyi and Bekker (2011:53)
Furthermore, a study by Baloyi and Bekker (2013:60) revealed the following factors as
causes that led to cost overruns: increase in material cost; inaccurate material estimates;
shortage of skilled labour; clients late contract award; project complexity; increase in labour
cost; inaccurate quantity take-off; difference between selected bids and the consultants
estimates; change orders by clients during construction and shortage of manpower.
The construction of the stadia further did not escape from schedule overruns as most stadiums
were not ready for the FIFA Confederations Cup. In Baloyi and Bekkers (2013:8) study on
the schedule overruns on the 2010 FIFA World Cup stadia in South Africa, the following
were revealed as the factors that caused schedule overruns: incomplete drawings; design
changes; clients slow decision-making; late issue of instructions; shortage of skilled labour;
poor planning and scheduling; labour disputes and strikes; shortage of manpower; changing
of orders by client during construction; poor information dissemination and delay in work
approval.
51
5.2
LESSONS LEARNT
The lessons learnt from the South African case stadia on the construction of the 2010 world
cup stadia are that there were various factors that led to cost overruns during the construction
works. These factors included: increase in material cost; inaccurate material estimates;
shortage of skilled labour; clients late contract award; project complexity; increase in labour
cost and inaccurate quantity take-off among other factors. The case study further showed that
there were also numerous factors that led to schedule overruns during the construction of the
2010 world cup stadia, these factors were incomplete drawings; design changes; clients slow
decision-making; late issue of instructions; shortage of skilled labour; poor planning and
scheduling; labour disputes and strikes; shortage of manpower; changing of orders by client
during construction; poor information dissemination and delay in work approval.
Furthermore, it was noted that when these identified factors are monitored and managed
properly cost and schedule overruns can be minimised of construction projects.
5.3
COST AND SCHEDULE OVERRUNS IN UGANDA
There is great concern in Uganda about schedule and cost overruns in public sector
construction projects because such projects are implemented using taxpayers' money. At the
national and international levels, there is considerable debate regarding how to minimise
project schedule and cost overruns (Alinaitwe, Apolot and Tindiwensi, 2013:33). According
to Alinaitwe et al (2013:34) most construction projects in Uganda have had problems with
delays in completion and cost overruns, which has caused considerable concern. The debate
in the construction industry on how to minimise or eliminate schedule and cost overrun has
continued for some time among professionals, clients, end users and policy makers. Further,
Alinaitwe et al (2013:35) concludes that cost and schedule overruns can occur for a wide
variety of reasons on various types of projects. If project costs or schedules exceed their
planned targets, client satisfaction could be compromised. The funding profile may no longer
match the budget limit and further slippage in the schedule could result. The resulting effects
are detrimental, especially in the case of developing countries, the measure of whose wealth
is greatly dependent on their performance in providing infrastructure through the construction
industry.
The study by Alinaitwe et al (2013:41) revealed that the five most frequent causes of
schedule overruns in Uganda are delayed payments, inadequate or inefficient equipment, the
need to repeat work due to poor-quality work, bureaucracy and changes in the work scope.
52
Further, it revealed the five highest factors in terms of their impact on schedule overruns
which included: delayed payments to contractors, political insecurity and instability,
inadequate or inefficient equipment, changes in the work scope and disputes among the
parties involved in the project. Alinaitwe et al (2013:41) showed the five factors that were
ranked the highest in terms of their importance to schedule overruns in Uganda included
changes of the work scope, delayed payments to contractors, poor monitoring and control,
high inflation and interest rates and political insecurity and instability. The study furthermore
showed that the five most frequent causes of cost overruns in Uganda are changes in the work
scope, high inflation and interest rates, poor monitoring and control, delayed payments to
contractors and fuel shortages. Further, it revealed the five highest ranked factors in terms of
their impact on cost overruns were changes in the work scope, high inflation and interest
rates, fuel shortages, poor monitoring and control and delayed payments to contractors.
Alinaitwe et al (2013:41) showed the five factors that were ranked the highest in terms of
their importance to cost overruns included changes in the work scope, high inflation and
interest rates, poor monitoring and control, delayed payments to contractors and deficiencies
in contract documents. Alinaitwe et al (2013:41) furthermore revealed the four factors that
were ranked as very important in terms of their effects on schedule and cost overruns were
changes in the work scope, delayed payments to contractors, poor monitoring and control and
high inflation and interest rates.
5.4
LESSONS LEARNT
The lesson learnt from the Uganda cause study was that there a various factors that cause cost
overruns in the Ugandan construction industry. These factors were changes in the work
scope, high inflation and interest rates, poor monitoring and control, delayed payments to
contractors and fuel shortages. Further, the study showed that the major causes of schedule
overruns in the Ugandan construction industry included delayed payments, inadequate or
inefficient equipment, the need to repeat work due to poor-quality work, bureaucracy and
changes in the work scope. Furthermore the case study illustrated factors that are important in
terms of their effects on cost and schedule overruns. These factors included changes in the
work scope, delayed payments to contractors, poor monitoring and control and high inflation
and interest rates. It was noted that when these identified factors are monitored and managed
properly cost and schedule overruns can be minimised of construction projects.
53
5.5
COST AND SCHEDULE OVERRUNS IN GHANA
According Ofori (2012: 6) for Ghana to be able to realise its aim of being the Gateway to
West Africa, it must have a good infrastructure. There are several reasons for this need.
First, a high quality of physical infrastructure would attract foreign investors to (re)locate
their operations in this country, as their overall costs would be low, thus enhancing their
global competitiveness. The costs of local firms would similarly be lower, with the same
result. Second, with a good infrastructure, networks of firms would be more effective as
supply chain management issues would be easier to deal with, and many factors in the
operating environment of companies more predictable. Finally, a high quality physical
infrastructure will earn Ghana much revenue as the ports of Tema and Takoradi could be
transhipment hubs, especially given the number of landlocked countries in the region and
finally to establish the physical infrastructure, an efficient construction industry is necessary.
Sutton and Kpentey (2012:109) states that the share of GDP associated with the building and
construction sector increased from 4.5% in 1975 to 8.5% in 2000. Over the next few years,
the sector continued to grow rapidly, but the annual growth rate slowed from 15% in 2007 to
12% in 2008, and since then the sector has contracted somewhat. The government is the
major sponsor of infrastructure projects (building and construction) and dominates the sector.
The construction industry provides means of production for other industries or commodities
to be consumed. As Ghana aspires to become a middle income nation by 2015, and with the
recent discovery of oil in commercial quantities, the role of the construction industry is
absolutely important. It is against this backdrop that investigating the factors responsible for
schedule and cost overruns in building construction and recommending measures to eradicate
or minimize them assume tremendous importance (Fugar and AgyakwahBaah, 2010:104).
Project success can be defined as meeting goals and objectives as prescribed in the project
plan. A successful project means that the project has accomplished its technical performance,
maintained its schedule, and remained within budgetary costs. Project management tools and
techniques play an important role in the effective management of a project. Therefore, a good
project management lies in the management tools and techniques used to manage the project.
(Frimpong, Oluwoye and Crawford, 2003:321). According to Alexander (2011:2) assessing
both construction projects cost and time is critical in todays market-driven economy. The
relationship between construction projects schedule and cost is called time-cost trade-off
decisions, which has been investigated extensively in the construction management literature.
Time-cost trade-off decisions are complex and require selection of appropriate construction
54
method for each project task. Time-cost trade-off, in fact, is an important management tool
for overcoming one of the critical path method limitations of being unable to bring the project
schedule to a specified duration. To maximize long-term return on this public investment,
government agencies have recently started utilizing new types of contracting methods that are
designed to achieve multiple project objectives, including minimizing construction cost and
duration, while maximizing its quality (Alexander, 2011:2).
Frimpong et al. (2003:324) revealed that the factors responsible for project schedule and cost
overruns according to contractors, consultants and owners in Ghana are: planning and
scheduling deficiencies; deficiencies in cost estimates prepared; inadequate control
procedures; delays in work approval; waiting for information; mistakes during construction;
delays in inspection and testing of work; cash flow during construction; frequent breakdowns
of construction plant and equipment; shortages of technical personnel; labour shortages;
monthly payment difficulties; poor contract management; shortage of materials, plant or
equipment parts and contractors financial difficulties. The other factors responsible for
schedule and cost overruns in Ghana identified by Frimpong et al. (2003:324) include: low
bid; material procurement; imported materials; late delivery of materials and equipment;
escalation of material prices; slow decision-making; inflation; difficulties in obtaining
construction materials at official current prices; ground problems; bad weather and
unexpected geological conditions.
5.6
LESSONS LEARNT
The lessons learnt from the case study of the Ghanaian construction industry were that there
are numerous factors that cause both cost and schedule overruns. These factors were planning
and scheduling deficiencies; deficiencies in cost estimates prepared; inadequate control
procedures; delays in work approval; waiting for information; mistakes during construction;
delays in inspection and testing of work; cash flow during construction; frequent breakdowns
of construction plant and equipment; shortages of technical personnel; labour shortages;
monthly payment difficulties; poor contract management; shortage of materials, plant or
equipment parts and contractors financial difficulties among other factors that were
identified as the major causes of cost and schedule overruns in Ghana. When these identified
factors that cause cost and schedule overruns are monitored and managed properly cost and
schedule overruns can be minimised in Ghana.
55
5.7
COST AND SCHEDULE OVERRUNS IN INDIA
According to Shanmugapriya and Subramanian (2013:734) large scale development activities

are taking place in the Indian construction industry and it has assumed the proportion and
responsibilities of a big business and is closely associated with nations economy. A large
number of building projects and new infrastructures are being built on a great scale which
contributes to the economic growth of country. Apart from the economy aspect, the speed
with which construction is carried out is also an important factor. Like other countries, India
is also facing a serious issue of schedule and cost overruns in construction projects. The
unfortunate part is that very few projects get delivered in time and on cost. Schedule and cost
overruns have become the hallmark of construction projects in India. Shanmugapriya and
Subramanian (2013:734) further states that the magnitude and causes behind these time and
cost overruns remain understudied together with the types of strategy intermediations
required to rectify the problem also remain unidentified. Schedule and cost overruns have
significant implications from an economic as well as political point of view. In general,
schedule overruns and cost overruns reduce the productivity of available economic resources,
edge the development potential and diminish the effectiveness of the economy. Government
data suggest that a majority of projects close to 60 per cent are overwhelmed by schedule and
cost overruns. Despite the importance and the significance of the construction sector in India,
it was noted that the owners, consultants, and contractors do not give its importance to
evaluate the time and cost overruns at the end of project.
Shanmugapriya and Subramanians (2013:738) study revealed twenty factors that lead to cost
overruns and ranked them as follows: high transportation cost; change in material
specification; escalation of material price; frequent breakdown of the construction plant and
equipment; reworks; lack of coordination at design stage; fluctuation in money exchange
rate; material fluctuation; additional work at owners request and high maintenance cost of
machinery were ranked as the top ten overall causes of cos overruns in India. Other causes
cost overruns factors identified by Shanmugapriya and Subramanian (2013:738) include:
shortage of materials; lack of coordination between designers; lack of information flow
between parties; lack of financial management and planning; incomplete design; high
quality of work required; difficulties on importing equipment and material; high cost of
machinery; mistakes during construction and wastages on site.
56
Shanmugapriya and Subramanians (2013:737) study further revealed the factors that are
responsible for schedule overruns and they include the following: material market rate;
contract modification; high level of quality requirement; project location; dependence on the
freshers to bear whole responsibility; rework of bad quality performance; often change of
subcontractors; lack of technical skills; lack of experience in similar projects and shortage of
experienced staff and labour were ranked as the top ten causes of schedule overruns in India.
Other causes schedule overruns factors identified by Shanmugapriya and Subramanian
(2013:738) include: high quality of work requirements; labour strikes; lack of sub-contractors
skills; unclear specifications; owners delay in freeing the contractor financial payment;
incomplete drawings; equipment shortage; poor productivity of material and labour; poor
scheduling of labour and material for work and poor documentation and no detailed written
procedures.
5.8
LESSONS LEARNT
The lessons learnt from the Indian case study on cost and schedule overruns were that there
are various factors that led to cost overruns on construction projects. These factors were high
transportation cost; change in material specification; escalation of material price; frequent
breakdown of the construction plant and equipment; reworks; lack of coordination at design
stage; fluctuation in money exchange rate; material fluctuation; additional work at owners
request and high maintenance cost of machinery were ranked as the top ten overall causes of
cos overruns in India. The case study further revealed that there are numerous factors that
cause schedule overruns in India and they included the following: material market rate;
contract modification; high level of quality requirement; project location; dependence on the
freshers to bear whole responsibility; rework of bad quality performance; often change of
subcontractors; lack of technical skills; lack of experience in similar projects and shortage of
experienced staff and labour were ranked as the top ten causes of schedule overruns in India.
5.9
COST AND SCHEDULE OVERRUNS IN AMERICA (FLORIDA)
According to Vidalis and Najafi (2002:2) completing transportation projects on time and
within budget has been a chronic problem for the Florida Department of Transportation
(FDOT). This is due to delays that cause schedule and cost overruns in highway construction
projects such as design error, poor coordination, inadequate scope, weather damages, and
other project changes. Delays can result in loss of time and money as well as inconveniences
57
to the public and they are caused externally or internally. External causes of delays are
originated outside of highway construction projects that are caused by various parties such as
utility companies, government, subcontractors, suppliers, weather, etc. Internal causes of
delays are harder to depict and are due to problems that may have been started by the
designers, owners, or contractors within the highway construction project. According to
Vidalis and Najafi (2002:2) further revealed that performance measures in Florida projects
indicated that cost and time overruns had shown a decrease from the past five fiscal years.
Even though the government and highway contractors try to avoid overruns in construction
and try to minimize the time and costs associated with overruns, they often find it difficult to
control the circumstances causing these overruns. To identify the reasons why authorities in
Florida have experienced cost and schedule overruns in transportation projects, an
examination of 708 recently completed projects that had experienced cost and schedule
overruns was conducted. Contract costs, time durations, and the causes of overruns were
taken from these various projects from the Florida authorities within the fiscal years from
1999 to 2001. The original contract amount for these projects over the two years exceeded
$1.9 billion. The cost overrun exceeded $200 million over the original contract amount. The
schedule overruns were 17% of the original contract time.
Results from the study of Vidalis and Najafi (2002:5) revealed that the major causes of cost
overruns in Florida included errors and omissions in plans and modifications; changed
environmental conditions; actions and inactions; minor changes; weather damages; claims;
invalid reasons and utility delays. The study further revealed the following as causes of
schedule overruns: changed environmental conditions; errors and omissions in plans and
modifications; actions and inactions; minor changes; utility delays; invalid reasons and
weather damages.
Vidalis and Najafi (2002:8) furthermore recommended measures that can be taken to
minimise cost and schedule overruns. These measures included developing goals before
planning start to minimize delays; design plans should be reviewed carefully when there are
increasing use of consultants; review design related problems from past projects; conduct
additional preliminary research and investigations on-site before bidding; minimise
construction conflict with involved parties by creating better communication and
coordination; develop innovative contracting methods; improve quality of design plans; make
use of experienced staff and consultants; emphasize on meeting project completion date;
58
perform constructability reviews that can examine whether projects can be built as designed;
prior to any project construction, local government requirements should be incorporated into
its design plans to make sure that utility lines have been identified or moved before
construction; utility companies should take responsibility for reviewing design plans and
paying their cost to move utility lines and delays from change conditions in work or work
orders can be reduced by carefully defining the work scope and predict changes in work
scope prior to construction.
5.10
LESSONS LEARNT
Lessons learnt from the case study of cost and schedule overruns in Florida, United States of
America were that there are various causes of cost overruns in America which included errors
and omissions in plans and modifications; changed environmental conditions; actions and
inactions; minor changes; weather damages; claims; invalid reasons and utility delays.
Further the case study showed that changed environmental conditions; errors and omissions
in plans and modifications; actions and inactions; minor changes; utility delays; invalid
reasons and weather damages were the major causes schedule overruns in America.
Furthermore, the case study revealed that there a number of measures that can be taken to
minimise cost and schedule overruns in America, these included: developing goals before
planning start to minimize delays; design plans should be reviewed carefully when there are
increasing use of consultants; review design related problems from past projects; conduct
additional preliminary research and investigations on-site before bidding; minimise
construction conflict with involved parties by creating better communication and
coordination; develop innovative contracting methods; improve quality of design plans; make
use of experienced staff and consultants; emphasize on meeting project completion date and
perform constructability reviews that can examine whether projects can be built as designed
among other measure that where revealed in the case study.
5.11
CHAPTER SUMMARY
This chapter gave an in-depth literature review of case studies in Uganda, Ghana, India and
South Africa. Findings revealed that the challenges faced in South Africa in terms of
delivering construction projects on time and within budget were similar to the challenges
faced by other countries in the world. The next chapter will discuss the research methodology
and the procedure followed during the study in order to achieve the goal of the study.
59
CHAPTER SIX
RESEARCH METHODOLOGY AND DESIGN
6.1
This chapter explains the research methodology used in carrying out this study. The
geographical area where the study was conducted, the study design and population sample are
also described. Furthermore, the instrument used in collecting the data, including methods
implemented to maintain validity and reliability of the instruments are described in order to
carry out the evaluation of the causes, effects and methods of minimising construction project
cost and schedule overruns in South Africa with specific reference to Gauteng Province.
6.2
RATIONAL OF THE STUDY
The rationale of the current study is to contribute to the body of knowledge on the subject of
cost and scheduling overruns using the Gauteng Province of South Africa as a case study.
6.3
RESEARCH APPROACH AND DESIGN
Burns and Grove (1993:777) define quantitative research as a formal, objective, systematic
process to describe and test relationships and examine causes and effects interactions among
variables. Hence, the current study adopted the Quantitative research approach to determine
the causes, effects and measures of minimising construction projects cost overruns in
Gauteng, South Africa. However, Polit and Hungler (1993:148) states that a quantitative
research is a survey to obtain information from a sample of people by means of self-report,
that is, the people respond to a sequence of questions posed to them by the researcher. The
current study collected information through a well-structured questionnaire which was
distributed to the respondents by the researcher.
A descriptive survey was selected because it gives an accurate account of the characteristics,
for example behaviour, opinions, abilities, beliefs and knowledge of a particular individual,
situation or group. This method was chosen to meet the objectives of this study, namely to
identifying the causes of cost and scheduling overruns, further, identify the effects of these
cost and scheduling overruns and eventually establish the measures that can be taken to
remedy cost and scheduling overruns in Gauteng, South Africa.
60
6.4
RESEARCH AREA
The study was carried out in Gauteng Province in, South Africa. The research incorporated
all construction professionals practicing in Gauteng. The province was selected for the
current study because the research was familiar with the area and there was easy accessibility
to the target area. The province was also selected because of the high number of construction
projects that were taking place at the time of the study. The target group in the research area
were architects, quantity surveyors, civil engineers, construction managers, construction
project managers, project managers and other professionals that are involved in construction
projects in Gauteng Province, South Africa.
Map 6.1: Map of Gauteng Province, South Africa

Source: CIA Factbook, 2010.
61
6.5
TARGET POPULATION
Burns and Grove (1993:779) define a population as the total of all the individuals who have
certain characteristics and are of interest to the researcher that meets the sample criteria for
inclusion in a study. The target population is defined as groups or individuals to whom the
survey applies. However, this can also be described as groups or individuals who are in a
position to answer the questions and to whom the results of the survey relate (Burns and
Grove, 1993:779).
The target population for the current study were architects, quantity surveyors, civil
engineers, construction managers, construction project managers, project managers and other
professionals that are involved in construction projects in Gauteng province, South Africa.
This was accomplished with the aid of a well-structured questionnaires distributed to the
respondents who are professionals in the field of construction in Gauteng, South Africa. This
yardstick was considered vital for the survey in order to have a true reflection of the causes,
effects and methods of minimising construction project cost and scheduling overruns.
6.6
SAMPLE
Teddlie and Yu (2007:77) state that there are two ways of statistical sampling strategy in the
social sciences: probability sampling and purposive sampling. Probability sampling
techniques are generally used in quantitative research. The random sampling technique was
preferred and adopted in the current study rather than the stratified sampling, cluster sampling
and sampling using multiple probability techniques. Random sampling was adopted because
it gave all the participants an equal of chance to be selected and all the participants were
selected with the same criteria which was that the participants had to be a construction
professional practicing in Gauteng, South Africa. This method is usually adopted when the
target population presents the same performance or qualifications, or the sampling size is
very large to represent the entire population efficiently and each member of the entire
population has an equal chance of being selected as a sampling respondent.
62
6.7
DATA COLLECTION
A list of potential respondents was generated after the questionnaire was approved for data
collection by the main supervisor of the current study. The questionnaires were distributed to
the respondents in two ways namely: hand delivery and through emails. After completing
filling in the questionnaires, the respondents emailed them back to the research; other
respondents hand delivered the questionnaires while others were physically collected by the
researcher from the respondents.
Data collection took approximately two months as the respondents were free to take their
time when filling in the questionnaires without any coercion though it took an average of
twenty five minutes to complete one questionnaire. A total of 142 questionnaires were
received back from the respondents.
6.8
INSTRUMENT OF DATA COLLECTION
A questionnaire was chosen for this research as a data collection instrument for the current
study. Burns and Grove (1993:368) define a questionnaire as a printed self-report form
designed to draw information that can be obtained through the written responses of the
subject. Burns and Grove (1993:368) further state that information obtained through a
questionnaire is similar to that obtained through an interview, but the questions tend to have
less depth.
Data was collected with the aid of a questionnaire to evaluate the causes, effects and methods
of minimising construction project cost and scheduling overruns in Gauteng, South Africa.
There are two types of questionnaires, that is, the closed-ended and the open-ended
questionnaires. In the open-ended questionnaires the respondents are required to respond in
writing in their own words and providing more details as they wish, whereas in the closedended questionnaires, the respondents are given options related to the research topic which
are determined by the researcher (Burns and Grove 1993:370). Therefore, a closed-ended
questionnaire was used in this research because it is easier to administer and analyse.
The questionnaire was in designed English as all the respondents are educated construction
professionals; therefore, they could read and answer the questions. The respondents were
assured of anonymity of their responses. The questionnaire consisted of seven sections A, B,
C, D, E, F and G. Section A was aimed at gaining demographic data such as sex, age, level of
63
education etc. This information would assist the researcher when interpreting the results;
Section B was aimed at evaluating the causes of construction project cost overruns; Section C
was aimed at evaluating the causes of construction project scheduling overruns; Section D
aimed at assessing the effects of construction project cost overruns; Section E aimed at
assessing the effects of construction project scheduling overruns; Section F of the
questionnaire explored methods of minimising construction project cost overruns and Section
G of the questionnaire explored methods of minimising construction project scheduling
overruns in Gauteng, South Africa. Instructions and guidelines were attached to the
questionnaires to guide the respondents on how to answer the questionnaires.
Out of the two hundred copies of the questionnaire sent out, one hundred and forty six were
received back which represent 73% response rate. These formed the basis of this study as
summarised in Table 6.1 below. This was considered adequate for analysis based on the
assertion by (Moser and Kalton, 1971) that the result of a survey could be considered as
biased and of little value if the return rate was lower than 30 to 40%.
Table 6.1: Questionnaire survey

Survey Responses
Respondents
Questionnaire sent out
200
Questionnaire received back
146
Usable questionnaire
146
Usable response rate (%)
73%
The collected data from the respondents was then cleaned and screened before analysis could
take place. Frequency analysis of the raw data was then done using Statistical Package for
Social Sciences (SPSS).
6.9
PERIOD OF COLLECTION
The data was collected by the researcher in the months of May to July, 2014.
64
6.10
MEAN ITEM SCORE (MIS)
A five point Likert scale was used to determine the causes, effects and methods of
minimising construction project cost and schedule overruns in the Gauteng Province of South
Africa with respect to the identified factors from the reviewed literature. The adopted scales
were as follows;
1.
= Strongly disagree
2.
= Disagree
3.
= Neutral
4.
= Agree
5.
= Strongly agree
The other scale used was as follows;

1.
= Extremely unlikely
2.
= Unlikely
3.
= Neutral
4.
= likely
5.
= Extremely likely
The five-point scale was transformed to mean item score (MIS) for each of the factors of
causes, effects and methods of minimising cost and schedule overruns as assessed by the
respondents. The indices were then used to determine the rank of each item. The ranking
made it possible to cross reference the relative importance of the items as perceived by the
respondents. This method was used to analyse the data collected from the questionnaires
survey.
The computation of the relative mean item score (MIS) was calculated from the total of all
weighted responses and then relating it to the total responses on a particular aspect. This was
based on the principle that respondents scores on all the selected criteria, considered
together, are the empirically determined indices of relative importance. The index of MIS of a
particular factor is the sum of the respondents actual scores (on the 5-point scale) given by
all the respondents as a proportion of the sum of all maximum possible scores on the 5-point
scale that all the respondents could give to that criterion. A weighting was assigned to each
response ranging from one to five for the responses of strongly disagree to strongly agree
65
and Extremely unlikely to Extremely likely. This is expressed mathematically below. The
mean item score (MIS) was calculated for each item as follows;
MIS= 1n1 + 2n2 + 3n3 +4n4+5n5 Equation 1.0

N
Where;
n1
Number of respondents for extremely unlikely or strongly disagree;
n2
Number of respondents for unlikely of disagree;
n3
Number of respondents for neutral;
n4
Number of respondents for likely or agree;
n5
Number of respondents for extremely likely or strongly agree;
Total number of respondents
After mathematical computations, the criteria are then ranked in descending order of their
mean item score (from the highest to the lowest).
6.11
CONSISTENCY
An internal consistence check was conducted using the consistence and reliability statistic
measure of the Cronbach's Alpha. According to Tavakol and Dennick (2011: 53) the
Cronbachs alpha measures the internal consistency of a test or scale; it describes the extent
to which all the items in a test measure the same concept or construct and hence it is
connected to the inter-relatedness of the items within the test. The current study adopted the
Cronbach's Alpha to check internal consistence, the results of the internal consistence for
each category of questions are shown in table 6.2 below.
66
Table 6.2: Consistence test using the Cronbach's Alpha

Category
Cronbach's Alpha
Causes of projects cost overruns
0.883
Owner related causes of projects schedule overruns
0.823
Contractor related causes of schedule overruns
0.861
Consultant related causes of projects schedule overruns
0.861
Material related causes of projects schedule overruns
0.910
Equipment related causes of projects schedule overruns
0.854
Labour related causes of projects schedule overruns
0.819
Causes of projects schedule overruns by external factors
0.875
Health and safety related causes of projects schedule overruns
0.901
Effects of projects cost overruns
0.855
Effects of projects schedule overruns
0.920
Measures of minimising projects cost overruns
0.930
Measures of minimising projects schedule overruns
0.929
Gliem and Gliem (2003: 87) state that an alpha of 0.8 is probably a reasonable goal. George
and Mallery (2003) further note that the value of the Cronbach's Alpha above 0.7 is
acceptable. Hence the current study proceeded with analysis as the internal consistence tests
revealed that the Cronbach's Alpha was within the acceptable values, hence all items in the
study were measuring the same concept and all the items were inter-related.
6.12
DATA ANALYSIS
Data collected from the respondents was cleaned and screened before analysis could take
place. Raw data was then entered onto a statistical Package for social sciences (SPSS) for
frequency analysis. Data presentation and analysis made use of frequency distributions and
percentages of all the respondents. Frequency tables were drawn and from there the data was
presented in pie chart diagrams, bar graphs and tables.
67
6.13
LIMITATION OF THE STUDY
This research assessment was only based on the construction professionals in Gauteng
Province in South Africa, with the respondent being architects, quantity surveyors, civil
engineers, construction managers, construction project managers, project managers and other
professionals that are involved in construction projects in Gauteng Province, South Africa.
This study only determined factors causing construction project cost and schedule overruns,
their effects and further determined measures of minimising cost and schedule overruns in
Gauteng Province, South Africa.
6.14
ETHICAL CONSIDERATION
The current study did not encounter or identify any ethical issues, however, the ethical
considerations in this research took into account the obligations to the professional in the
industry whose work that had contributed to the literature was properly cited and
acknowledged. The obligation to the participants in the research questionnaire, was that their
input was be kept confidential and only used for academic purposes. Respondents to the
questionnaire had the right not to answer questions that they felt were not appropriate without
any coercion.
A written cover letter of permission to carry out this research study was obtained from the
University of Johannesburg, Department of Construction Management and Quantity
Surveying, Doornfontein Campus which was affixed to the questionnaires sent out.
Anonymity and confidentiality was maintained throughout the study. Anonymity is a

situation where the respondents cannot be linked, even by the researcher, to their individual
responses (Burns and Grove 1993:762).
6.15
CHAPTER SUMMARY
In this chapter, the research methodology used for the study was described, including the
population, sample, data collection instruments as well as strategies used to ensure ethical
standards and also why questionnaires were adopted for the research. The next chapter of this
study presents the data analysis and discussion.
68
CHAPTER SEVEN
QUESTIONNAIRE SURVEY RESULTS
7.1
This chapter presents the results of data obtained from the well-structured questionnaires,
which were circulated to the research respondents, who included: architects, quantity
surveyors, civil engineers, construction managers, construction project managers, project
managers and other professionals that are involved in construction projects in Gauteng
province, South Africa. The analysis of the data and interpretation of the results were
obtained from the questionnaire study and it served as the basis of this quantitative data
collection. All questions in the questionnaires were answered and it comprised of twenty
questions. The analysis was based on one hundred forty six completed questionnaires out of
two hundred that were sent out, which reflects a 73% response rate.
The first section of the questionnaire explored the background information of the
respondents. The second section looked at the major causes of cost overruns in construction
industry in Gauteng, South Africa. The third section explored the causes of construction
schedule overruns in the construction industry in Gauteng, South Africa. The fourth section
explored the effects of cost overruns in the construction industry in Gauteng, South Africa.
The fifth section looked at the effects of schedule overruns in the construction industry in
Gauteng, South Africa. The sixth section explored the measures of minimising cost overruns
in the construction industry in Gauteng, South Africa, while the seventh section explored the
measures of minimising construction schedule overruns in Gauteng, South Africa.
7.2
BIOGRAPHICAL DATA
This section discusses the profile of the respondents with regard to their demographic
attributes, namely, gender, race, age group, professional qualification, years of experience,
highest qualification and type of employer.
69
7.2.1 Biographical data results

Findings from the 146 usable questionnaires revealed that 59.6% of the respondents were
male and 40.4% were female. Findings relating to the respondents age group revealed that
29.5% of the respondents were in the age group of 20-25 years old, 26.7% of the respondents
were in the age group 26-30 years old, 17.1% were in the age group 31-35 years old, 11.6%
were in the age group 36-40 years old, 6.2% of the respondents were in the age group 41-45
years old, 4.1% were in the age group 46-50 years old, 3.4% of the respondents were above
50 years old and 1.4% of the respondents were between 51-55 years old. Further, results
showed that 76.7% of the respondents were Black, 14.4% were White, 4.8% were either
Indian or Asian and 4.1% of the respondents were Coloured. Findings relating to
respondents work professional qualification, results showed that 38.4% were quantity
surveyors, 20.5% were civil engineers, 11% were project managers, 10.3% were construction
managers, 8.9% were construction project managers, 5.5% were architects and 5.5% selected
others, which included an artisan, a building inspector, electrical contractors, a safety
consultant and a site agent.
Furthermore, results revealed that 56.8% of the respondents had experience that ranged from
1-5 years, 20.5% had experience in the range of 6-10 years, 11.6% had experience that
ranged between 11-15 years, 6.2% had more than 20 years experience and 4.8% had
experience that ranged from 16-20 years in the construction industry. Further, 46.6% of the
respondents had bachelors degrees, 32.2% had diplomas, 12.3% of the respondents had
masters degrees, 4.1% of the respondents had doctorate degrees and 4.8% of the respondents
only had metric (grade 12) certificates. Furthermore, it was revealed that 35.6% of the
respondents were employees of contractors, 34.9% of the respondents were employees of
consultants and 20.5% were government employee, 8.2% were employed by clients and 0.7%
of the respondents were self-employed.
70
7.3
DATA ANALYSIS
7.3.1 Section A: Background information of respondents.
Figure 7.1 reveals that out of the 146 respondents 59.6% were male, while 40.4% were
female.
Female
40,4%
Male
59,6%
Figure 7.1: Respondents Gender
Findings relating to the respondents age group as shown in Figure 7.2 below revealed that
29.5% of the respondents were in the age group of 20-25 years old, 26.7% of the respondents
were in the age group 26-30 years old, 17.1% were in the age group 31-35 years old, 11.6%
were in the age group 36-40 years old, 6.2% of the respondents were in the age group 41-45
years old, 4.1% were in the age group 46-50 years old, 3.4% of the respondents were above
50 years old and 1.4% of the respondents were between 51-55 years old.
71
3,4%
55 years & Above
1,4%
51 years 55 years
4,1%
46 years 50 years
6,2%
41 years 45 years
11,6%
36 years 40 years
17,1%
31 years 35 years
26,7%
26 years 30years
29,5%
20 years 25 years
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Figure 7.2: Respondents' age group
Figure 7.3 shows the respondents ethnicity, it reveals that 76.7% of the respondents were
black, 14.4% were white, 4.8% were either Indian or Asian and 4.1% of the respondents were
coloured.
80.0
76,7%
70.0
60.0
50.0
40.0
30.0
14,4%
20.0
4,8%
4,1%
10.0
0.0
Black
White
Coloured
Indian or Asian
Figure 7.3: Respondent's ethnicity
72
Figure 7.4 represents the professional qualification of the sampled respondents and it reveals
that 38.3% were quantity surveyors, 20.5% were civil engineers, 11% were project managers,
10.3% were construction managers, 8.9% were construction project managers, 5.5% were
architects and 5.5% selected others, which included an artisan, a building inspector, electrical
contractors, a safety consultant and a site agent.
5,5%
Others
8,9%
Construction project manager
10,3%
Construction Manager
11,0%
Project Manager
20,5%
Civil Engineer
38,3%
Quantity- Surveyor
5,5%
Architect
0.0
5.0
10.0 15.0 20.0 25.0 30.0 35.0 40.0
Figure 7.4: Respondents' professional qualification
Figure 7.5 shows the working experience of the respondents sampled in the industry, it
revealed that 56.9% had experience that ranged from 1-5 years, 20.5% had experience in the
range of 6-10 years, 11.6% had experience that ranged between 11-15 years, 6.2% had more
than 20 years experience and 4.8% had experience that ranged from 16-20 years in the
construction industry.
73
60.0
56,9%
50.0
40.0
30.0
20,5%
20.0
11,6%
4,8%
10.0
6,2%
0.0
1 - 5 years
6 - 10 years 11 - 15years 16- 20 years
20 years &
above
Figure 7.5: Respondents' years of experience
Figure 7.6 represents the educational qualifications of the respondents and it showed that
46.6% of the respondents had bachelors degrees, 32.2% had diplomas, 12.3% of the
respondents had masters degrees, 4.1% of the respondents had doctorate degrees and 4.8% of
the respondents only had metric (grade 12) certificates.
4,1%
Doctorate
12,3%
M-degree
46,6%
B-Degree
32,2%
Diploma
4,8%
Matric Certificate ( grade 12 )

0.0
10.0
20.0
30.0
40.0
Figure 7.6: Respondents' Education qualification
74
50.0
The figure7.7 shows respondents current employers and it indicates that 35.6% of the
respondents were employees of contractors, 34.9% of the respondents were employees of
consultants and 20.6% were government employee, 8.2% were employed by clients and 0.7%
of the respondents were self-employed.
35,6%
34,9%
40.0
35.0
30.0
20,6%
25.0
20.0
15.0
10.0
8,2%
0,7%
5.0
0.0
Client
Consultant
Contractor
Government
Others
Figure 7.7: Respondents' current employer
Figure 7.8 represents the number of construction projects that the respondents were involved
in and it showed that 47.2% of the respondents were involved in 1-2 projects, 31.5% were
involved in 3-4, 9.6% were involved in 5-6 projects, 6.2% were involved in more than 8
projects, 4.8% of the respondents were not involved in any projects and 0.7% of the
respondents were involved in 7-8 projects.
6,2%
More than 8 projects
0,7%
7 8 projects
9,6%
5 6 projects
31,5%
3 4 projects
47,2%
1 2 projects
4,8%
None
0.0
10.0
20.0
30.0
40.0
Figure 7.8: Respondents' construction projects involved in

75
50.0
The figure 7.9 below shows the number of construction projects that the respondents were
involved in and were beyond the original contract sum. It was revealed that 56.2% of the
respondents were involved in 1-2 projects that were beyond the contract sum, 27.1% did not
have projects that were beyond the contract sum, 13.9% were involved in 3-4 projects that
were beyond the contract sum, 1.4% were involved in more than 8 projects that were beyond
the original contract sum and 0.7% were involved in 5-6 and 7-8 projects that were beyond
the original contract sum.
1,4%
7 8 projects
0,7%
5 6 projects
0,7%
13,9%
3 4 projects
56,2%
1 2 projects
27,1%
None
0.0
10.0
20.0
30.0
40.0
50.0
60.0
Figure 7.9: Construction projects beyond original contract sum
Figure 7.10 reveals the amounts in overruns that construction projects encounters. It shows
that 23.6% of the respondents were involved in projects that were experiencing cost overruns
of over R500 000.00, 22.9% of the respondents were involved in projects that had no cost
overruns, 20.8% were involved in projects that had cost overruns of between R50 001.00R100 000.00, 17.4% were involved in projects that had cost overruns between R0-R50
000.00, 8.3% were involved in projects that had cost overruns between R100 001.00-R200
000.00, 3.5% were involved in project that had cost overruns between R200 001.00-R300
000.00 and another 3.5% were involved in projects that had cost overruns between R300
001.00-R500 000.00.
76
23,6%
Over R500 000.00

R300 001.00 R500 000.00
3,5%
R200 001.00 R300 000.00
3,5%
8,3%
R100 001.00 R200 000.00
20,8%
R50 001.00 R100 000.00
17,4%
R0 R50 000.00
22,9%
None
0.0
5.0
10.0
15.0
20.0
25.0
Figure 7.10: Construction projects amounts overruns
The figure 7.11 below shows the number of construction projects that the respondents were
involved in and were behind schedule. It was revealed that 54% of the respondents were
involved in 1-2 projects that were behind schedule, 31.2% did not have projects that were
behind schedule, 11.1% were involved in 3-4 projects that were behind schedule, 2.1% were
involved in 5-6 projects that behind schedule and 0.7% were involved in more than 8 projects
that were behind schedule.
54,9%
60.0
50.0
40.0
31,2%
30.0
11,1%
20.0
2,1%
10.0
0,7%
0.0
None
1 2 projects 3 4 projects 5 6 projects More than 8

projects
Figure 7.11: Construction projects behind schedule
77
Figure 7.12 shows the period of schedule overruns on construction projects that the
respondents were involved in. It reveals that 72.1% of the respondents said their projects are
behind schedule by 0-6 months, 18.6% said 7-12 months, 4.3% said 13-18 months, 2.9% said
19-24 months, 1.4% said more than 3 years and 0.7% said their projects were behind
schedule by 25-30 months.
80.0
72,1%
70.0
60.0
50.0
40.0
30.0
18,6%
20.0
10.0
4,3%
2,9%
0,7%
13 18
Months
19 24
Months
25 30
Months
1,4%
0.0
06
Months
7 12
Months
More than
3 years
Figure 7.12: Period of schedule overrun
Figure 7.13 shows the types of construction projects that experience cost overruns. It reveals
that 14.4% of the respondents said renovations experience the most cost overruns. 12.7% said
construction of shopping complexes, 12.1% said road construction, 11.9% said construction
of housing estates, 11.3% said construction of schools, 11.0% said construction of hospitals,
10.7% said other civil works like dam construction, 10.2% said construction of government
offices and 5.5% said stadia construction experiences more cost overruns.
78
12.7%
Shopping complexes
5.5%
Stadia
14.6%
Renovations (Residential, civil etc)
10.2%
Government offices
10.7%
Other civil works (Dams etc.)
12.1%
Road construction
11,9%
Housing estates
11.0%
Hospitals
11.3%
Schools
0.0%
2.0%
4.0%
6.0%
8.0%
10.0% 12.0% 14.0% 16.0%
Figure 7.13: Types of projects which experience cost overruns
Figure 7.14 shows the types of projects that encounter schedule overruns. It reveals that
15.1% of the respondents said renovations experience more schedule overruns, 14.2% said
shopping complexes, 12% said road construction, 11.1% said housing estates, 11.1% said
other civil works like dam construction, 10.7% said construction of schools, 9.5% said
construction of hospitals, 9.5% said construction of government offices, and 6.8% said
construction of stadia experiences more schedule overruns.
14.2%
Shopping complexes
6.8%
Stadia
15.1%
9.5%
Government offices
11.1%
12.0%
Road construction
11.1%
Housing estates
9.5%
Hospitals
10,7%
Schools
0.0%
2.0%
4.0%
6.0%
8.0%
10.0% 12.0% 14.0% 16.0%
Figure 7.14: Types of projects that experience schedule overruns

79
7.3.2 Section B: Causes of construction projects cost overruns in Gauteng, South Africa
Table 7.1 reveals the respondents ranking of factors that cause cost overruns in Gauteng,
South Africa. It reveals that inadequate planning was ranked first with a mean score of 4.27
and standard deviation (SD) = 0.889; change in project design was ranked second with a
mean score of 4.19 and SD = 0.908; poor project management assistance was ranked third
with a mean score of 3.98 and SD = .960; inadequate financial provision was ranked fourth
with a mean score of 3.94 and SD = 0.830 and inaccurate estimates was also ranked fourth
with a mean score of 3.94 and SD = 0.919. The table further reveals that shortage of skilled
workers was ranked eighth with a mean score 3.74 and SD = 1.053; insufficient time for
estimation was ninth with mean score 3.71 and SD = 1.017 and lack of executive capacity by
the employer was ranked tenth with a mean score of 3.69 and SD = 0.965. Moreover, the
table shows that breach of local regulations was ranked sixteenth with a mean score of 3.40
and SD = 1.026; unsteady economy was ranked seventeenth with a mean score of 3.20 and
SD = 1.112, project site location was raked eighteenth with a mean score of 3.16 and SD =
1.106 and shortage of unskilled site workers was raked the least with a mean score of 3.12
and SD = 1.207.
Table 7.1: Causes of construction projects cost overruns

X
Inadequate planning
0.889
4.27
Change in project design
0.908
4.19
Poor project management assistance
0.960
3.98
Inadequate financial provision
0.830
3.94
Inaccurate estimates
0.919
3.94
Variation orders
0.913
3.93
Contractors inexperience
1.078
3.93
Poor workmanship
0.891
3.92
Overdesign
1.092
3.76
Shortage of skilled site workers
1.053
3.74
Insufficient time for estimation
1.017
3.71
Lack of executive capacity by the employer
0.965
3.69
10
CAUSES OF COST OVERRUNS
(Professionals/Consultants)
80
Project complexity
1.000
3.69
10
Unsteady material supply
0.978
3.61
11
Shortening of contract period
1.150
3.61
11
Site conflicts among construction parties
1.053
3.57
12
Inclement weather conditions
1.064
3.55
13
Material price fluctuations
0.951
3.53
14
Inflation
0.905
3.46
15
Breach of local regulation
1.026
3.40
16
Unsteady economy
1.112
3.20
17
Project site location
1.106
3.16
18
Shortage of unskilled site workers
1.207
3.12
19
X = Standard deviation; x = Mean item score; R = Rank
7.3.3 Section C: Causes of construction projects schedule overruns in Gauteng, South

Africa
7.3.3.1 Owner-related causes of construction project schedule overruns in Gauteng,

South Africa
The respondents were further asked to rank causes of schedule overruns related to the owners
in Gauteng. The following results as shown in Table 7.2 were obtained: slowness in decision
making process was ranked first with a mean score of 4.15 and standard deviation (SD) =
0.802; change in design by the owner during construction was also ranked first with a mean
score of 4.15 and SD = 0.839; poor project coordination was ranked second with a mean
score of 4.13 and SD = 0.892; late revising and approving of design documents was ranked
third with a mean score of 4.08 and SD = 0.835 and poor communication was ranked fourth
with a mean score of 4.01 and SD = .0924. Table 7.2 additionally shows that delay in handing
over the site was ranked seventh with a mean score of 3.80 and SD = 0.929; delay in
approving shop drawings was ranked eighth with a mean score of 3.78 and SD = 0.854 and
delay in approving sample materials was ranked the least with a mean score of 3.74 and SD =
0.965.
81
Table 7.2: Owner-related causes of construction projects schedule overruns

X
Slowness in decision making process
0.802
4.15
Change in design by the owner during construction
0.839
4.15
Poor project coordination
0.892
4.13
Late revising and approving of design documents
0.835
4.08
Poor communication by the client to the construction
0.924
4.01
Delay in progress payments
0.997
3.89
Suspension of workers by owner
1.105
3.85
Delay in handing over the site
0.929
3.80
Delay in approving shop drawings
0.854
3.78
Delay in approving sample materials
0.965
3.74
CAUSES OF SCHEDULE OVERRUNS
team
7.3.3.2 Contractor-related causes of construction project schedule overruns in Gauteng,

South Africa
Table 7.3 reveals the respondents ranking of causes of schedule overruns related to the
contractor in Gauteng, South Africa. It shows that re-work due to errors during construction
was ranked first with a mean score of 4.23 and standard deviation (SD) = 0.771; poor
coordination was ranked second with a mean score of 4.19 and SD = 0.769; poor
communication was ranked third with a mean score of 4.18 and SD = 0.822; ineffective
planning and scheduling of project was ranked fourth with a mean score of 4.14 and SD =
0.796 and difficulties in financing projects was ranked fifth with a mean score of 3.99 and SD
= 0.915. Table 7.3 likewise reveals that improper method statements was ranked ninth with a
mean score of 3.86 and SD = 0.858; frequent change of sub-contractors was ranked tenth
with a mean score of 3.78 and SD = 0.960; poor qualifications of contractors technical staff
was ranked eleventh with a mean score of 3.68 and SD = 1.059 and delay in site mobilisation
was ranked the least with a mean score of 3.60 and SD = 0.985.
82
Table 7.3: Contractor related causes of construction projects schedule overruns

X
Rework due to errors during construction
0.771
4.23
Poor coordination
0.769
4.19
Poor communication
0.822
4.18
Ineffective planning and scheduling of project
0.796
4.14
Difficulties in financing projects
0.915
3.99
Contractors experience
1.034
3.98
Conflicts in sub-contractors schedule in execution of
0.840
3.94
0.940
3.94
Improper construction methods implementation
0.886
3.92
Delay in sub-contractors work
0.901
3.92
Improper method statements
0.858
3.86
Frequent change of sub-contractors
0.960
3.78
10
Poor qualification of the contractors technical staff
1.059
3.68
11
Delay in site mobilisation
0.985
3.60
12
project
Conflicts between contractor and other parties
(Construction team members)
7.3.3.3 Consultant-related causes of construction project schedule overruns in Gauteng,

South Africa
The respondents were furthermore asked to rank causes of schedule overruns related to the
consultants in Gauteng. The following results as shown in Table 7.4 were obtained: delay in
approving major changes in the scope of work was raked first with a mean score of 4.14 and
standard deviation (SD) = 0.905; unclear and inadequate details in drawings was ranked
second with a mean score of 4.12 and SD = 0.840; poor communication was ranked third
with a mean score 4.10 and SD = 0.823; poor coordination was ranked fourth with a mean
score of 4.06 and SD = 0.848 and delay in producing design documents was ranked fifth with
a mean score of 4.01 and SD = 0.881. Additionally, Table 7.4 shows that insufficient data
collection and survey before design was ranked eighth with a mean score of 3.92 and SD =
83
0.921 and lack of advanced engineering design software was ranked the least with a mean
score of 3.50 and SD = 1.008.
Table 7.4: Consultant related causes of construction projects schedule overruns

X
0.905
4.14
Unclear and inadequate details in drawings
0.840
4.12
Poor communication
0.823
4.10
Poor coordination
0.848
4.06
Delays in producing design documents
0.881
4.01
Mistakes and inconsistences in design documents
0.833
4.00
Inadequate experience of consultants
0.937
3.96
Insufficient data collection and survey before design
0.921
3.92
Lack of advanced engineering design software
1.008
3.50

Delay in approving major changes in the scope of
work
7.3.3.4 Material-related causes of construction project schedule overruns in Gauteng,

South Africa
Table 7.5 reveals the respondents ranking of causes of schedule overruns related to material
in Gauteng, South Africa. It shows that delay in material delivery was ranked first with a
mean score of 4.09 and standard deviation (SD) = 0.847; lateness in material ordering was
ranked second with a mean score of 4.01 and SD = 0.920; damage of sorted material while
needed urgently was ranked third with a mean score of 3.97 and SD = 0.885; change in
material types during construction was ranked fourth with a mean score of 3.88 and SD =
0.964 and delivery of wrong material was also ranked fourth with a mean score of 3.88 and
SD = 0.968. Moreover, Table 7.5 reveals that fluctuation in material prices was ranked eighth
with a mean score of 3.65 and SD = 1.047; availability of specified materials on the market
was ranked ninth with a mean score of 3.63 and SD = 1.101 and availability of improved
materials on the market was ranked the least with a mean score of 3.52 and SD = 1.028.
84
Table 7.5: Material related causes of construction projects schedule overruns

X
Delay in material delivery
0.847
4.09
Lateness in material ordering
0.920
4.01
Damage of sorted material while needed urgently
0.885
3.97
Changes in material types during construction
0.964
3.88
Delivery of wrong material
0.968
3.88
Ordering wrong material
0.981
3.87
Inappropriate storage of material leading to damages
0.928
3.86
Delivery of sub-standard material
0.916
3.81
Fluctuation in material prices
1.047
3.65
Availability of specified construction materials on the
1.101
3.63
1.028
3.52
10
market
Availability of improved materials on the market
7.3.3.5 Equipment-related causes of construction project schedule overruns in Gauteng,

South Africa
Furthermore, the respondents were asked to rank causes of schedule overruns related to
equipment in Gauteng. The following results as shown in Table 7.6 were obtained: shortage
of skilled operators was ranked first with a mean score 3.88 and standard deviation (SD) =
0.949; shortage of equipment was also ranked first with a mean score of 3.88 and SD =
0.954; equipment breakdowns was ranked second with a mean score of 3.79 and SD = 0.966;
low productivity and efficiency of equipment was ranked third with a mean score of 3.72 and
SD = 0.963; use of wrong equipment was ranked fourth with a mean score of 3.61 and SD =
1.082; use of absolute equipment was ranked fifth with a mean score of 3.43 and SD = 0.970
and lack of high-technology equipment was ranked the least with a mean score of 3.35 and
SD = 1.071.
85
Table 7.6: Equipment related causes of construction projects schedule overruns

X
Shortage of skilled operators
0.949
3.88
Shortage of equipment
0.954
3.88
Equipment breakdowns
0.966
3.79
Low productivity and efficiency of equipment
0.963
3.72
Use of wrong equipment
1.082
3.61
Use of absolute equipment
0.970
3.43
Lack of high-technology mechanical equipment
1.071
3.35
7.3.3.6 Labour-related causes of construction project schedule overruns in Gauteng,

South Africa
Table 7.7 reveals the respondents ranking of causes of schedule overruns related to labour in
Gauteng, South Africa. It shows that low productivity level of workers was ranked first with
a mean score of 4.05 and standard deviation (SD) = 0.822; inexperience of workers was
ranked second with a mean score of 3.96 and SD = 0.832; work attitude of workers was
ranked third with a mean score of 3.91 and SD = 0.892; insecurity by not passing on related
work experience was ranked fourth with a mean score of 3.80 and SD = 0.835; shortage of
labour was ranked fifth with a mean score 3.73 and SD = 1.142; conflicts among workers was
ranked sixth with mean score of 3.62 and SD = 0.999 and late approval or issuing of work
permits for immigrate workers was ranked the least with a mean score of 3.40 and SD=
1.079.
86
Table 7.7: Labour related causes of construction projects schedule overruns

X
Low productivity level of workers
0.822
4.05
Inexperience of workers
0.832
3.96
Work attitude of workers
0.892
3.91
Insecurity by not passing on related work experience
0.835
3.80
Shortage of labour
1.142
3.73
Conflicts among workers
0.999
3.62
Late approval or issuing of work permits for
1.079
3.40
immigrant workers
7.3.3.7 Causes of construction project schedule overruns by external factors in Gauteng,

South Africa
The respondents were asked to rank causes of schedule overruns related to external factors in
Gauteng. The following results as shown in Table 7.8 were obtained: delay in obtaining
permits from municipality was ranked first with a mean score of 3.98 and standard deviation
(SD) = 0.835; weather effects on construction activities was ranked second with a mean score
of 3.77 and SD = 0.951; delay in performing final inspection and certification was ranked
third with a mean score of 3.76 and SD = 0.992; effects of subsurface and ground conditions
was ranked fourth with a mean score of 3.71and SD = 0.883 and delay in providing services
from utilities was ranked fifth with a mean score of 3.62 and SD = 0.931. Further, the table
reveals that change in economic factors was ranked eighth with a mean score of 3.60 and SD
= 1.059; change in government regulations and laws was ranked ninth with a mean score of
3.51 and SD = 1.016 and traffic control and restriction at site was ranked the least with a
mean score of 3.42 and SD = 1.019.
87
Table 7.8: Causes of construction projects schedule overruns by external factors

X
Delay in obtaining permits from municipality
0.835
3.98
Weather effects on construction activities
0.951
3.77
Delay in performing final inspection and certification
0.992
3.76
Effects of subsurface and ground conditions
0.883
3.71
Delay in providing services from utilities
0.931
3.62
Natural disasters
1.139
3.63
Political interference
1.071
3.61
Change in economic factors
1.059
3.60
Change in government regulation and laws
1.016
3.51
Traffic control and restriction at sites
1.019
3.42
10
7.3.3.8 Health and safety-related causes of construction project schedule overruns in

Gauteng, South Africa
Table 7.9 reveals the respondents ranking of health and safety factors that cause of schedule
overruns in Gauteng, South Africa. It shows that workers risky behaviour was ranked first
with a mean score of 3.73 and standard deviation (SD) = 0.969; working in unsafe areas was
ranked second with a mean score of 3.72 and SD = 1.024; accidents during construction was
ranked third with a mean score of 3.69 and SD = 1.024; work stoppages due to not observing
H&S regulations was ranked fourth with a mean score of 3.64 and SD = 0.922 and
insufficient safety offers on site was ranked fifth with a mean score of 3.57 and SD = 1.065.
Table 7.9 furthermore reveals that death of skilled workers during construction was ranked
eighth with a mean score of 3.51 and SD = 1.093; poorly updated health and safety files was
ranked ninth with a mean score of 3.46 and SD = 0.998 and death of unskilled workers during
construction was ranked the least with a mean score of 3.10 and SD = 1.117.
88
Table 7.9: Health and Safety related causes of construction projects schedule overruns
X
Workers risky behaviour
0.969
3.73
Working in unsafe areas
1.024
3.72
Accidents during construction
1.024
3.69
Work stoppages due to not observing H&S
0.922
3.64
Insufficient safety officers on site
1.065
3.57
Non-use of safety equipment at all times
1.015
3.54
Use of inappropriate equipment
1.013
3.53
Death of skilled workers during construction
1.093
3.51
Poorly updated health and safety files
0.998
3.46
Death of unskilled workers during construction
1.117
3.10
10
regulations
7.3.4 Section D: Effects of construction projects cost overruns in Gauteng, South Africa
Table 7.10 reveals the respondents ranking of effects of cost overruns in Gauteng, South
Africa. It shows that construction project delays was ranked first with a mean score of 4.26
and standard deviation (SD) = 0.856; increased project cost due to extension of time was
ranked second with a mean score of 4.13 and SD = 0.871; liability of companies or firms to
bad debt was ranked third with a mean score of 4.03 and SD = 0.930; project abandonment
was ranked fourth with a mean score of 3.91 and SD = 0.975; company or firm insolvency
was ranked fifth with a mean score of 3.89 and SD = 0.865; under-utilisation of plant and
equipment purchased for the project was ranked sixth with a mean score of 3.82 and SD =
0.955; tying down clients capital was ranked seventh with a mean score of 3.78 and SD =
0.954 and under-utilisation of manpower resources was ranked the least with a mean score of
3.78 and SD = 0.972.
89
Table 7.10: Effects of construction projects cost overruns

X
Construction projects delays
0.856
4.26
Increased project cost due to extension of time
0.871
4.13
Liability of companies or firms to bad debt
0.930
4.03
Project abandonment
0.975
3.91
Company/firms insolvency
0.865
3.89
Under-utilisation of plant and equipment purchased
0.955
3.82
Tying down clients capital
0.954
3.78
Under-utilisation of manpower resources
0.972
3.78
EFFECTS OF COST OVERRUNS
for the project
7.3.5 Section E: Effects of construction projects schedule overruns in Gauteng, South

Africa
Furthermore, the respondents were asked to rank the effects of construction projects schedule
overruns in Gauteng, South Africa. Table 7.11 reveals that extension of time was ranked first
with a mean score of 4.33 and standard deviation (SD) = 0.829; cost overruns was also
ranked first with a mean score of 4.33 and SD = 0.846; loss of profit was ranked second with
a mean score of 4.16 and SD = 0.939; disputes was ranked third with a mean score of 4.11
and SD =0.831 and poor quality of work due to hurrying the project was ranked fourth with a
mean score of 4.10 and SD = 0.837. Table 7.11 likewise reveals that delaying in getting profit
by the contractor was ranked ninth with a mean score of 3.92 and SD = 0.884; creates stress
on the contractor was also ranked ninth with a mean score of 3.92 and SD = 0.949; delaying
the client to repay back bank loans was ranked tenth with a mean score of 3.90 and SD =
0.995 and bad reputation with the client was ranked eleventh with a mean score of 3.89 and
SD = 1.008. The table additionally shows that total project abandonment was ranked
sixteenth with a mean score of 3.70 and SD = 1.075; loss of skilled employees was also
ranked sixteenth with a mean score of 3.69 and SD = 1.077; negative social impact was
ranked eighteenth with a mean score of 3.54 and SD = 0.904 and loss of un-skilled
employees was ranked the least with a mean score of 3.10 and SD = 1.099.
90
Table 7.11: Effects of construction projects schedule overruns

X
Extension of time
0.829
4.33
Cost overruns
0.846
4.33
Loss of profit
0.939
4.16
Disputes
0.831
4.11
Poor quality of work due to hurrying the project
0.837
4.10
Creates stress to the client
0.931
4.01
Acceleration losses
0.826
3.98
Bad reputation with contraction team
0.944
3.96
Claims
0.974
3.95
Delay in getting profit by the client
0.884
3.92
Creates stress on the contractor
0.949
3.92
Delaying the client to repay back bank loans
0.995
3.90
10
Bad reputation with client
1.008
3.89
11
Termination of contracts
1.075
3.83
12
Arbitration
0.875
3.81
13
Bankruptcy of the client
1.050
3.80
14
Idling resources
0.877
3.71
15
Litigation
0.994
3.70
16
Total project abandonment
1.075
3.70
16
Loss of skilled employees
1.077
3.69
17
Negative social impact
0.904
3.54
18
Loss of un-skilled employees
1.099
3.10
19
EFFECTS OF SCHEDULE OVERRUNS
91
7.3.6 Section F: Measures to minimising construction projects cost overruns in Gauteng,

South Africa
Table 7.12 shows the respondents ranking of the measures that can be undertaken to
minimise construction projects cost overrun in Gauteng. The table shows that adequate
planning was ranked first with a mean score of 4.48 and standard deviation (SD) = 0.691;
proper pre-contract planning was ranked second with a mean score of 4.36 and SD =0.765;
proper project implementation was ranked third with mean score 4.31 and SD =0.714; good
workmanship was also ranked third with a mean score of 4.31 and SD = 0.762 and appointing
of experienced contractors was also ranked third with a mean score of 4.31 and SD = 0.867.
Table 7.12 additionally reveals that employment of experienced site workers was ranked
seventh with a mean score of 4.22 and SD = 0.713; allocation of adequate project duration
was ranked eighth with a mean score of 4.20 and SD = 0.871; reliable pre-contract estimates
was ranked ninth with a mean score of 4.18 and SD = 0.766 and appointment of highly
experienced technical design team was ranked tenth with a mean score of 4.17 and SD =
0.808. The table further shows that proper implementation of local regulations was ranked
sixteenth with a mean score of 4.05 and SD = 0.850 and use of up-to-date technology was
ranked the least with a mean score of 3.87 and SD = 1.009.
Table 7.12: Measures of minimising construction projects cost overruns

X
Adequate planning
0.691
4.48
Proper pre-contract planning
0.765
4.36
Proper project implementation and management
0.714
4.31
Good workmanship
0.762
4.31
Appointment of experienced contractors
0.867
4.31
Ordering the right materials
0.751
4.30
Completed designs at the time of tender
0.800
4.30
Timely supply of material
0.789
4.27
Use of appropriate construction methods
0.757
4.26
Employment of experienced site workers
0.713
4.22
Allocation of adequate project duration
0.871
4.20
Reliable pre-contract estimates
0.766
4.18
MEASURES OF MINIMISING COST OVERRUNS
92
Appointment of highly experienced technical consultants
0.808
4.17
10
Appointment of highly experienced committed design
0.824
4.13
11
Adequate designs
0.806
4.11
12
Allowing for material price escalations in the original
0.891
4.10
13
Adequate pre-contract project coordination
0.779
4.08
14
Comprehensive client brief development
0.846
4.06
15
Decrease number of variation orders
0.898
4.06
15
Proper implementation of local regulation
0.850
4.05
16
Use of up-to-date technology
1.009
3.87
17
team
tender document
7.3.7 Section G: Measures to minimising construction projects schedule overruns in

Gauteng, South Africa
The respondents were asked to rank the measures of minimising schedule overruns in
Gauteng. Table 7.13 reveals that proper project planning and scheduling was ranked first with
a mean score of 4.57 and standard deviation (SD) = 0.686; effective strategic planning was
ranked second with a mean score of 4.53 and SD = 0.678; site management and supervision
was ranked third with a mean score of 4.48 and SD = 0.738; frequent coordination between
the construction team was ranked fourth with a mean score of 4.44 and SD = 0.677 and
availability of clear information and communication channels was ranked fifth with a mean
score of 4.42 and SD = 0.734. The table further shows that collaborative working by the
entire construction team was ranked eighth with a mean score of 4.36 and SD = 0.799; proper
material procurement was ranked ninth with a mean score of 4.29 and SD = 0.720 and
appropriate construction methods was ranked tenth with a mean score of 4.24 and SD =
0.847. Table 7.13 likewise reveals that use of up-to-date technology was ranked thirteenth
with a mean score of 3.90 and SD = 0.951 and fast-tracking construction was ranked the least
with a mean score of 3.83 and SD = 1.028.
93
Table 7.13: Measure of minimising construction projects schedule overruns

X
Proper project planning and scheduling
0.686
4.57
Effective strategic planning
0.678
4.53
Site management and supervision
0.738
4.48
Frequent coordination between the construction team
0.677
4.44
Availability of clear information and communication
0.734
4.42
Complete and proper design at the right time
0.732
4.39
Frequent progress meeting
0.794
4.39
Adherence to construction specifications
0.727
4.37
Building according to the construction drawings
0.800
4.37
Collaboration working by the entire construction team
0.799
4.36
Proper material procurement
0.720
4.29
Appropriate construction methods
0.847
4.24
10
Accurate initial cost estimates
0.847
4.19
11
Use proper and modern construction equipment
0.980
3.94
12
Use up-to-date technology utilisation
0.951
3.90
13
Fast-tracking construction
1.028
3.83
14
MEASURES
OF
MINIMISING
SCHEDULE
OVERRUNS
channels
7.4
CHAPTER SUMMARY
Data obtained from the well-structured questionnaire sent out and completed by the
architects, quantity surveyors, civil engineers, construction managers, construction project
managers, project managers and other professionals that are involved in construction projects
in Gauteng was presented and analysed in this chapter. The next chapter will focus on the
discussion of the findings from the research analysis in relation to the research questions and
the research objectives that were formulated in Chapter One. The purpose for this is to
establish if the research objectives were met.
94
CHAPTER EIGHT
DISCUSSION OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
8.1
Chapter eight discusses the findings from the research analysis in relation to the research
questions. The findings are further discussed in relation to the reviewed literature in Chapters
2, 3, 4 and 5. This is with the view of ascertaining if the defined research problems have been
answered from the findings analysis in Chapter Seven. Results have been presented in
relation to the research question and the relevant data as required. This chapter also presents
conclusions based on the research objectives and finally gives a general research conclusion.
8.2
RESEARCH QUESTION 1
What are the factors that cause cost overruns on construction projects in South Africa?
8.2.1 Findings
Based on the ranking (R) using the calculated standard deviation (SD) and mean scores (x)
for the listed causes of construction projects cost overruns, it was observed that the most
dominant causes include: inadequate planning (SD=0.889; x=4.27; R=1), change in project
design (SD=0.908; x= 4.19; R=2), poor project management assistance (Professionals or
Consultants) (SD=0.960; x=3.98; R=3), inadequate financial provision (SD=0.830; x=3.94;
R=4), inaccurate estimates (SD=0.919; x=3.94; R=4), variation orders (SD=0.913; x=3.93;
R=5), contractors inexperience (SD=1.078; x=3.93; R=5); poor workmanship (SD=0.891;
x=3.92; R=6), overdesign (SD=1.092, x=3.76; R=7) and shortage of skilled site workers
(SD=1.053; x=3.74; R=8). These findings were similar to the findings by Eshofonie
(2008:32), where cost of material, incorrect planning and poor contract management were
revealed to be the major causes of construction projects cost overruns. Similarly, the results
were similar to the results shown in the study of Frinpong et al. (2003:324) where planning
and scheduling deficiencies was identified as the major cause of construction projects cost
overruns. However, the results were not in agreement with the study by Baloyi and Bekker
(2013:60) where increase in material cost and inaccurate material estimates were identified as
the major causes of construction projects cost and schedule overruns. Further, the results in
the current study did not agree with the study by Ali and Kamaruzzama (2010:112) where
95
inaccurate estimate of original cost, inflation of project costs and improper planning were the
major causes of cost overruns.
8.3
RESEARCH QUESTION 2
What are the factors that cause schedule overruns on construction projects in South Africa?
8.3.1 Findings
Based on the complex nature of construction project schedule overruns, in order to rightly
answer this research question, the factors that cause construction schedule overruns were
categorised into: owner related; contractor related; consultant related; material related;
equipment related; labour related; causes by eternal factors and health and safety causes of
schedule overruns. The findings relating to the present research question are thus presented as
such.
8.3.1.1 Owner-related causes of construction projects schedule overruns

for the listed causes of construction projects schedule overruns, the study revealed that
slowness in decision making process (SD=0.802; x=4.15; R=1), change in design by the
owner during construction (SD=0.839; x=4.15; R=1), poor project coordination (SD=0.892;
x=4.13; R=2), late revising and approving of design documents (SD=0.835; x=4.08; R=3),
poor communication by the client to the construction team (SD=0.924; x=4.01; R=4), delay
in progress payments (SD=0.997; x=3.89; R=5), suspension of workers by owner (SD=1.105;
x=3.85; R=6), delay in handing over the site (SD=0.929; x=3.80; R=7), delay in approving
shop drawings (SD=0.854; x=3.78; R=8) and delay in approving sample materials
(SD=0.965; x=3.74; R=9) were the causes of schedule overruns related to the owner. These
results are in general agreement with the study of Denini (2010:28) who also identified
slowness in the decision making process by the owner as the major cause of construction
schedule overruns related to the owners. However, the results were not in agreement with the
study of Wei (2010: 35) who showed that the major cause of construction projects schedule
overruns related to the owner is late revising and approving of design documents by the
client. However, they were not similar to the results in the study by Ayudhya (2011:1032)
where delay in progress payment by the owner was identified as the major cause of schedule
overruns related to the owner.
96
8.3.1.2 Contractor-related causes of construction projects schedule overruns

The study further revealed that there are causes of schedule overruns that are contractor
related. It was found that the major causes included: rework due to errors during construction
(SD=0.771; x=4.23; R=1), poor coordination (SD=0.769; x=4.19; R=2), poor communication
(SD=0.822; x=4.18; R=3), ineffective planning and scheduling of project (SD=0.796; x=4.14;
R=4), difficulties in financing projects (SD=0.915; x=3.99; R=5), contractors experience
(SD=1.034; x=3.98; R=6), conflicts in sub-contractors schedule in execution of project
(SD=0840; x=3.94; R=7), conflicts between contractor and other parties (Construction team
members) (SD=0.940; x=3.94; R=7), improper construction methods implementation
(SD=0.886; x=3.92; R=8) and delay in sub-contractors work (SD=0.901; x=3.92; R=8).
These findings were not in agreement with the study by Wong and Vimonsatit (2012: 3396)
where financial difficulties by the contractor was identified as the major cause of contractor
related causes of schedule overruns. The results were also not in agreement with the study by
Atout and Jones (2008: 755) where non-preparing of method statements was identified as the
major cause of contractor related cause of schedule overruns.
8.3.1.3 Consultant-related causes of construction projects schedule overruns

Furthermore, the study revealed consultant related causes of schedule overruns. The causes
were: delay in approving major changes in the scope of work (SD=0.905; x=4.14; R=1),
unclear and inadequate details in drawings (SD=0.840; x=4.12; R=2), poor communication
(SD=0.823; x=4.10; R=3), poor coordination (SD=0.848; x=4.06; R=4), delays in producing
design documents (SD=0.881; x=4.01; R=5), mistakes and inconsistences in design
documents (SD=0.833; x=4.00; R=6), inadequate experience of consultants (SD=0.937;
x=3.96; R=7), insufficient data collection and survey before design (SD=0.921; x=3.92; R=8)
and lack of advanced engineering design software (SD=1.008; x=3.50; R=9). These findings
were in agreement with the studies by Theodore (2009) and Wei (2010: 38) where delay in
approving major changes in the scope of works by the consultants was ranked the number
one cause of consultant related causes of construction projects schedule overruns. However,
the results were not in agreement with the study by Le-Hoai et al. (2008: 370) where poor
project management was identified as the major cause of contractor related causes of
schedule overruns.
97
8.3.1.4 Material-related causes of construction projects schedule overruns

When the respondents were asked to rank the material related causes of construction projects
schedule overruns in Gauteng, the following results were obtained: delay in material delivery
(SD=0.847; x=4.09; R=1), lateness in material ordering (SD=0.92; x=4.01; R=2), damage of
sorted material while needed urgently (SD=0.885; x=3.97; R=3), changes in material types
during construction (SD=0.964; x=3.88; R=4), delivery of wrong material (SD=0.968;
x=3.88; R=4), ordering wrong material (SD=0.981; x=3.87; R=5), inappropriate storage of
material leading to damages (SD=0.928; x=3.86; R=6), delivery of sub-standard material
(SD=0.916, x=3.81; R=7), fluctuation in material prices (SD=1.047; x=3.65; R=8) and
availability of specified construction materials on the market (SD= 1.101; x=3.63; R=9) were
the top ten material related causes of construction projects schedule overruns. These findings
were in agreement with the studies by Wei (2010: 42) and Assaf and Al-Hejji (2006:352)
where delay in material delivery was identified as the major cause of material related causes
of construction projects schedule overruns. However, the findings were not similar to the
study by Alwi and Hampson (2003: 4) where poor quality of material was identified as the
major cause of material related causes of schedule overruns.
8.3.1.5 Equipment-related causes of construction projects schedule overruns

for the listed equipment related causes of construction projects schedule overruns, it was
observed that the causes include: shortage of skilled operators (SD=0.949; x=3.88; R=1),
shortage of equipment (SD=0.954; x=3.88; R=1), equipment breakdowns (SD=0.966;
x=3.79; R=2), low productivity and efficiency of equipment (SD=0.963; x=3.72; R=3), use of
wrong equipment (SD=1.082; x=3.61; R=4), use of absolute equipment (SD=0.970; x=3.43;
R=5) and lack of high-technology mechanical equipment (SD=1.071; x=3.35; R=6). The
findings were not in agreement with the study by Theodore (2009) and Assaf and Al-Hejji
(2006: 352) where equipment breakdowns were identified as the major cause of equipment
related causes of schedule overruns. Further, the results were not similar to the study by Wei
(2010: 46) where lack of high-technology mechanical equipment was shown to be the major
cause of equipment related causes of schedule overruns.
98
8.3.1.6 Labour-related causes of construction projects schedule overruns

Further, the respondents were asked to rank the labour related causes of construction projects
schedule overruns in Gauteng. The results obtained were as follows: low productivity level of
workers (SD=0.822; x=4.05; R=1), inexperience of workers (SD=0.832; x=3.96; R=2), work
attitude of workers (SD=0.892; x=3.91; R=3), insecurity by not passing on related work
experience (SD=0.835; x=3.80; R=4), shortage of labour (SD=1.142; x=3.73; R=5), conflicts
among workers (SD=0.999; x=3.62; R=6) and late approval or issuing of work permits for
immigrant workers (SD=1.079; x=3.40; R=7). The results were in agreement with the study
by Wei (2010: 44) where low productivity levels of workers was identified as the major cause
of labour related causes of schedule overruns. However, the results were not in agreement
with the study by Sambasivan and Soon (2007: 522) where shortage of labour was identified
as the major cause of labour related causes of schedule overruns.
8.3.1.7 Causes of construction projects schedule overruns by external factor

Furthermore, the respondents were asked to rank the causes of construction projects schedule
overruns by external factors in Gauteng. The results obtained were as follows: delay in
obtaining permits from municipality (SD=0.835; x=3.98; R=1), weather effects on
construction activities (SD=0.951; x=3.77; R=2), delay in performing final inspection and
certification (SD=0.992; x=3.76; R=3), effects of subsurface and ground conditions
(SD=0.883; x=3.71; R=4), delay in providing services from utilities (SD=0.931; x=3.62;
R=5), natural disasters (SD=1.139; x= 3.63; R=6), political interference (SD=1.071; x=3.61;
R=7), change in economic factors (SD=1.059; x=3.60; R=8), change in government
regulation and laws (SD=1.016; x=3.51; R=9) and traffic control and restriction at sites
(SD=1.019; x3.42; R=10). These findings were not in agreement with the study by Alwi and
Hampson (2003: 4) where site conditions was identified as the major cause of external factors
related causes of schedule overruns. Furthermore, the results were not similar to the results
of the study by Wei (2010: 44) where effects of subsurface and ground conditions was
identified as the major cause of external factors related causes of schedule overruns.
99
8.3.1.8 Health and Safety-related causes of construction projects schedule overruns

The study further revealed that the health and safety related causes of schedule overruns. It
was revealed that the causes included: workers risky behaviour (SD=0.969; x=3.73; R=1),
working in unsafe areas (SD=1.024; x=3.72; R=2), accidents during construction (SD=1.024;
x=3.69; R=3), work stoppages due to not observing H&S regulations (SD=0.922; x=3.64;
R=4), insufficient safety officers on site (SD=1.065; x=3.57; R=5), non-use of safety
equipment at all times (SD=1.015; x=3.54; R=6), use of inappropriate equipment (SD=1.013;
x=3.53; R=7), death of skilled workers during construction (SD=1.093; x=3.51; R=8), poorly
updated health and safety files (SD=0.998; x=3.46; R=9) and death of unskilled workers
during construction (SD=1.117; x=3.10; R=10). Very few or no studies have been conducted
on health and safety related causes of construction projects schedule overruns, hence the
current study adopted the category to add to the body of knowledge.
8.4
RESEARCH QUESTION 3
What are the effects of cost overruns on construction projects in South Africa?
8.4.1 Findings
for the listed effects of construction projects cost overruns in Gauteng, it was revealed that
the effects of cost overruns include: construction projects delays (SD=0.856; x=4.26; R=1),
increased project cost due to extension of time (SD=0.871; x=4.13; R=2), liability of
companies or firms to bad debt (SD=0.930; x=4.03; R=3), project abandonment (SD=0.975;
x=3.91; R=4), company or firms insolvency (SD=0.965; x=3.89; R=5), under-utilisation of
plant and equipment purchased for the project (SD=0.955; x=3.82; R=6), tying down clients
capital (SD=0.954; x=3.78; R=7) and under-utilisation of manpower resources (SD=0.972;
x=3.78; R=7). These findings were in agreement with the studies by Nega (2008: 103) where
delays during construction were identified as the major effect of cost overruns. However, the
findings were not in agreement with the study by Eshofonie (2008:20) where company or
firm liability to insolvency was identified as the major effect of construction projects cost
overruns.
100
8.5
RESEARCH QUESTION 4
What are the effects of Schedule overruns on construction projects in South Africa?
8.5.1 Findings
Furthermore, the respondents were asked to rank the effects of construction projects schedule
overruns in Gauteng, the results obtained included the follows: extension of time (SD=0.829;
x=4.33; R=1), cost overruns (SD=0.846; x=4.33; R=1), loss of profit (SD=0.939; x=4.16;
R=2), disputes (SD=0.831; x=4.11; R=3), poor quality of work due to hurrying the project
(SD=0.837; x=4.10; R=4), creates stress to the client (SD=0.931; x=4.01; R=5), acceleration
losses (SD=0.826; x=3.98; R=6), bad reputation with contraction team (SD=0.944; x=3.96;
R=7), claims (SD=0.974; x=3.96; R=8) and delay in getting profit by the client (SD=0.884;
x=3.92; R=9) were the top ten effect of construction projects effects in Gauteng. The findings
were similar to the results in the study by Sunjka and Jacob (2013: 7), Aibinu and Jagboro
(2002: 595), Motaleb and Kishk (2010:1155) and Pourrostam and Ismail (2011:454) were
time overrun and cost overruns was identified as the major effects of construction projects
schedule overruns.
8.6
RESEARCH QUESTION 5
What measures can be taken to minimize cost and schedule overruns on construction projects
in South Africa?
8.6.1 Findings
for the listed measures of minimising construction projects cost overruns in Gauteng, results
showed that the most effective measures include the following: adequate planning
(SD=0.691; x=4.48; R=1), proper pre-contract planning (SD=0.765; x=4.36; R=2), proper
project implementation and management (SD=0.714; x=4.31; R=3), good workmanship
(SD=0.762; x=4.31; R=3), appointment of experienced contractors (SD=0.867; x=4.31; R=3),
ordering the right materials (SD=0.751; x=4.30; R=4), completed designs at the time of
tender (SD=0.800; x=4.30; R=4), timely supply of material (SD=0.789; x=4.27; R=5), use of
appropriate construction methods (SD=0.757; 4.26; R=6) and employment of experienced
site workers (SD=0.713; x=4.22; R=7). These findings were in agreement with the results in
the study by Menon et al (2012:50) where effective project planning was highlighted as the
most effective measure of minimising construction projects cost overruns. However the
101
findings were not in agreement with the study by Arcila (2012: 34) and Azis et al
(2013:2625) where adequate funding and proper costing and financing respectively were
identified as the major measure of minimising construction projects cost overruns.
Furthermore, the respondents were asked to ranks the measures that can be undertaken to
minimise construction projects schedule overruns. The survey revealed the following factors
as the top ten measure of minimising construction projects schedule overruns in Gauteng:
proper project planning and scheduling (SD=0.686; x=4.57; R=1), effective strategic
planning (SD=0.678; x=4.53; R=2), site management and supervision (SD=0.738; x=4.48;
R=3), frequent coordination between the construction team (SD=0.677; x=4.44; R=4),
availability of clear information and communication channels (SD=0.734; x=4.42; R=5),
complete and proper design at the right time (SD=0.732; x=4.39; R=6), frequent progress
meeting (SD=0.794; x=4.39; R=7), adherence to construction specifications (SD=0.727;
x=4.37; R=8), building according to the construction drawings (SD=0.800; 4.37; R=9) and
collaboration working by the entire construction team (SD=0.799; x=4.36; R=10). These
findings were similar to the findings of Jonathan (20013:7) and Memon et al (2012:50) where
effective project planning was identified as the most effective way of minimising
construction projects schedule overruns. However, the study by Wei (2010:57) identified site
management and supervision as the most effective measure of minimising construction
projects schedule overruns.
8.7
CONCLUSIONS
The aim of the current research study was to explore the causes, effects and methods of
minimising construction project cost and schedule overruns in Gauteng, South Africa. In this
chapter the conclusions and recommendations of the research study are presented and
discussed in relation to the objectives of the study. In order to accomplish this purpose, the
specific objectives of the study were:
To determine the factors that causes cost overruns on construction projects in

Gauteng, South Africa.
To determine the factors that causes schedule overruns on construction projects in

Gauteng, South Africa.
102
To determine the effects of cost overruns on construction projects in Gauteng, South

Africa.
To determine the effects of schedule overruns on construction projects in Gauteng,

South Africa.
To establish measures that can be taken to minimize cost and schedule overruns on
construction projects in Gauteng, South Africa.
Below the researcher demonstrates how the current study objectives were answered.
8.7.1 RESEARCH OBJECTIVE 1

The first research objective was to determine the factors that cause cost overruns on
Literature revealed that the major causes of construction cost overruns include: fluctuation in
prices of raw materials, unstable cost of manufactured materials, high cost of machineries,
lowest bidding procurement method, poor project management and poor cost control, design
changes, risk and uncertainty associated with projects, inaccurate evaluation of projects time
or duration, non-performance of subcontractors and nominated suppliers, complexity of
works, additional work, inappropriate government policies and priorities and improper
planning were among the identified causes of cost overruns.
Findings from the questionnaire survey results obtained from the respondents showed that
inadequate planning, change is project design, poor project management, inadequate financial
provision,
inaccurate
estimates,
variation
orders,
contractors
inexperience
poor
workmanship, overdesign and shortage of skilled site workers were the top ten causes of
construction projects cost overruns in Gauteng revealed from the questionnaire survey. Hence
the research objective was achieved from both literature review and from a well-structured
questionnaire.
103

The second objective of the current study was to determine the factors that cause schedule
overruns on construction projects in Gauteng, South Africa.
Literature revealed that there are different causes of construction project schedule overruns
and they include the following; causes that are client related, causes that are contractor
related, causes that are consultant related, causes that are material related, causes that are
equipment related, causes that are labour related and external factors related causes.
Literature further showed the following as the causes in each of the above categories; delay in
progress payments, difficulties in financing project by contractors, delay in approving major
changes in the scope of work, shortage of construction materials in market, equipment
breakdowns, shortage of labour and effects of subsurface and ground conditions as some of
the causes of construction project schedule overruns.
From the survey results obtained from the respondents, slowness in decision making process,
reworks due to errors during construction, delay in approving major changes in the scope of
work, delay in material delivery, shortage of skilled equipment operators, low productivity
level of workers, delay in obtaining permits from municipalities and workers risky behaviour
on sites were the major causes of construction projects schedule overruns in Gauteng, South
Africa. Therefore, it can be inferred that the research objective was met based on the findings
form the structured questionnaire survey.

The third objective of the study was to analyse the effects of cost overruns on construction
projects in Gauteng, South Africa.
Literature on the effects of construction cost overruns revealed that additional cost, budget
short fall, adversarial relationship between participants of the project, loss of reputation to the
consultant and project abandonment were among the effects of construction projects cost
overruns.
Findings from the questionnaire survey revealed that construction projects delays, increased
project cost due to extension of time, liability of companies or firms to bad debt, project
abandonment, company or firms insolvency, under-utilisation of plant and equipment
purchased for the project, tying down clients capital and under-utilisation of manpower
104
resources were the effects of construction projects cost overruns in Gauteng, South Africa.
Hence the objective of the study was achieved from both literature review and from a wellstructured questionnaire.

The fourth research objective was to ascertain the effects of schedule overruns on
Literature revealed that there are various effects of construction projects schedule overruns.
The following were identified as some of the effects of construction project delays according
to literature; time overrun (extension of time), cost overrun, disputes, arbitration, litigation,
total abandonment and claims.
From the questionnaire survey obtained from the respondents, it was revealed that extension
of time, cost overruns, loss of profit, disputes, poor quality of work due to hurrying the
project, creates stress to the client, acceleration losses, bad reputation with contraction team,
claims and delay in getting profit by the client were the top ten identified effects of
construction projects cost overruns in Gauteng, South Africa. Therefore, the research
objective was achieved in the current study.

The last objective of the current study was to establish measures that can be taken to
minimize cost and schedule overruns on construction projects in Gauteng, South Africa.
Literature reviewed revealed the following among others as the major measures that can be
taken to minimise construction projects cost overruns: adequacy of funding, adequacy of
plans and specifications, budget updates, constructability, economic risks, owner's
involvement and frequent feedback, owner's commitment to established schedules and
budget, project manager commitment and involvement, project manager competency and
experience, realistic obligations and clear objectives and risk identification and management.
Furthermore, literature identified the following as some of the measure that can be taken to
minimise construction projects schedule overruns; site management and supervision,
effective strategic planning, clear information and communication channels, collaborative
105
working in construction, proper project planning and scheduling, frequent coordination

between the parties involved, complete and proper design at the right time, use appropriate
construction methods, accurate initial cost estimates and proper material procurement.
From the survey results obtained from respondents it was observed that adequate planning,
proper pre-contract planning, proper project implementation and management, good
workmanship, appointment of experienced contractors, ordering the right materials,
completed designs at the time of tender, timely supply of material, use of appropriate
construction methods and employment of experienced site workers.
Furthermore, the questionnaire survey revealed the following as the top ten measures that can
be undertaken to minimise construction projects schedule overruns in Gauteng, South Africa:
proper project planning and scheduling, effective strategic planning, site management and
supervision, frequent coordination between the construction team, availability of clear
information and communication channels, complete and proper design at the right time,
frequent progress meeting, adherence to construction specifications, building according to the
construction drawings and collaboration working by the entire construction team. Therefore it
can be concluded that the research objective was achieved from both literature review and
from a well-structured questionnaire.
8.8
GENERAL RESEARCH CONCLUSION
Literature review revealed that there are a number of factors that causes construction projects
cost overruns. The causes identified from the literature were similar to those identified in the
current study. Further, the literature review showed that the causes of construction projects
schedule overruns are found at different levels ranging from those caused by the client or
owner to those that are caused by other external factors. The literature showed that each
category of the causes of schedule overruns had different factors that can lead to schedule
overruns on construction projects. This study examined causes of construction project
schedule overruns from the seven identified categories as compiled from an extensive
literature review. Findings from the study supported work done by previous researchers and
scholars that not a singular factor is responsible for causing schedule overruns on
construction projects.
106
Furthermore findings revealed that there are corresponding negative effects of both cost and
schedule overruns on construction projects in Gauteng, South Africa. However, the study
identified measures that can be taken by construction professional to avoid and eventually
reduce construction projects cost and schedule overruns. The empirical study indicate
findings of the causes, effects and methods of minimising construction projects cost and
schedule overruns in Gauteng, South Africa. Therefore, the results revealed in this study
contributes to the body of knowledge and gives valuable suggestions on running construction
projects in way that minimises cost and schedule overruns.
8.9
RECOMMENDATIONS
Construction project cost and schedule overruns usually occur during the construction phase
and they are mostly caused by inadequate planning, change is project design, poor project
management, inadequate financial provision, inaccurate estimates slowness in decision
making process, reworks due to errors during construction, delay in approving major changes
in the scope of work, delay in material delivery, shortage of skilled equipment operators, low
productivity level of workers, delay in obtaining permits from municipalities and workers
risky behaviour on sites among other causes. Therefore,
It is recommended that all members of construction teams should be trained and

educated on the factors that cause project cost and schedule overruns in order to
minimise these overruns.
It is also recommended that frequent site co-ordination meetings should be held in

order to flag possible cost and schedule overruns.
It is further recommended that clients should appoint experienced contractors and

consultants in order to minimise cost and schedule overruns.
Members of construction teams practice the identified measures of reducing

construction project cost and schedule overruns such as; adequate planning, proper
pre-contract planning, proper project implementation and management, good
workmanship, appointment of experienced contractors, site management and
supervision, effective strategic planning, clear information and communication
107
channels, use proper and modern construction equipment, and proper project planning
and scheduling among other identified measures.
8.10
AREAS FOR FURTHER STUDIES
The study further recommends the following as areas of possible research:
Further study should be conducted to evaluate the extent to which cost and schedule
overruns can be mitigated if only experienced and financially sound contractors are
always appointed.
Research should be conducted to evaluate how good project management can

minimise cost and schedule overruns in South Africa.
The current study revealed that late ordering and late delivery of materials are major
causes of schedule overruns. A study should therefore be conducted on the
effectiveness of the procurement systems in South Africa.
Further research should be conducted to evaluate the extent to which cost and
schedule overruns would be reduced when effective health and safety measures are
implemented on construction sites.
108
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10.5897/SRE12.138: ISSN 1992-2248 2012 Academic Journals.
Zhu, K. and Lin, L. (2004). A stage by stage factor control frame work for cost
estimation of construction projects, Owners Driving Innovation. International
Conference. http:/ flybjerg. Plan.aau.dk / JAPAASPUBLISH.
119
APPENDIX 1: Cover Letter
University of Johannesburg
Department of Construction Management and Quantity Surveying
Doornfontein, 2028
2014.
TO WHOM IT MAY CONCERN

Dear Sir/Madam;
LETTER OF INVITATION FOR RESEARCH SURVEY
We would like to invite you to participate in this research project. Attached to this letter is a short questionnaire
requesting you to complete it. This project is an M-Tech study being conducted at the Faculty of Engineering
and the built Environment, Department of Construction Management and Quantity Surveying, University of
Johannesburg, Doornfontein campus, South Africa. The research topic is: COST AND SCHEDULE
OVERRUNS ON CONSTRUCTION PROJECTS IN SOUTH AFRICA. The study is a pre-requisite of the
department for the completion of a Masters Technologiae degree course in Construction Management.
As part of this research we need to test the validity of the measures in improving construction projects delivery
time. We would like you to assist us identify the causes, effects and methods of minimizing construction project
cost and schedule overruns in South Africa.
Please do not enter your name or contact details on the questionnaire. It remains anonymous.
Information provided by you remains confidential and will be kept at the department.
Answering this questionnaire will take approximately 25 minutes.
Should you wish to know the findings of the research, you are welcome to contact Mukuka M.J. telephonically
at: +27781239353/+27723066439 or at:sirjoze2002@gmail.com or Dr Aigbavboa C.O. at: +2711-559-6398 0r
at:aigclinton@gmail.com. The faculty will gladly send you a summary of the results. Please answer the
questions TRUTHFULLY AND SINCERELY so as to help us improve the management of contracts in South
Africa.
Thanking you in advance
MUKUKA M.J.
120
APPENDIX 2: Questionnaire
QUESTIONNAIRE ON COST AND SCHEDULE OVERRUNS ON CONSTRUCTION PROJECTS IN
SOUTH AFRICA
INSTRUCTIONS:
PLEASE ANSWER THE FOLLOWING QUESTIONS BY CROSSING (X) ON THE RELEVANT
BLOCK OR WRITTING DOWN YOUR ANSWER IN THE SPACE PROVIDED.
EXAMPLE of how to complete this questionnaire:
Your gender? If you are female:
Male
Female
1
2
SECTION A - BACKGROUND INFORMATION
This section of the questionnaire refers to background or biographical information. Although we are aware of
the sensitivity of the questions in this section, the information will allow us to compare groups of respondents.
Once again, we assure you that your response will remain anonymous. Your cooperation is appreciated.
1.
Gender
Male
Female
2.
1
2
What is your age group

20 years 25 years
26 years 30 years
31 years 35 years
36 years 40 years
41 years 45 years
46 years 50 years
51 years 55 years
55 years & Above
3.
Ethnicity
Black
White
Coloured
Indian or Asian
4.
1
2
3
4
5
6
7
8
1
2
3
4
What is your professional qualification?

Architect
Quantity- Surveyor
Civil Engineer
Project Manager
Construction Manager
Construction Project Manager
Others: please specify
1
2
3
4
5
6
7
121
5.
How many years of experience do you have in the construction industry?

1 - 5 years
1
6 10 years
2
11 15 years
3
16 20 years
5
20 years & above
6
6.
State your highest educational qualification?

No qualification
Grade 9 certificate
Matric Certificate ( grade 12 )
Diploma
Bachelors Degree
Masters Degree
Doctorate
7.
1
2
3
4
5
6
7
For which of the following do you currently work for?

Client
Consultant
Contractor
Government
Others, specify
8.
State the number of construction project you are currently involved in.
None
1 2 projects
3 4 projects
5 6 projects
7 8 projects
9.
1
2
3
4
5
1
2
3
4
5
6
How many of these projects are beyond the original contract sum?
None
1 2 projects
3 4 projects
5 6 projects
7 8 projects
1
2
3
4
5
6
10. State the amount of cost overruns that your project is experiencing
None
R0 R50 000
R50 001 R100 000
R100 001 R200 000
R200 001 R300 000
R300 001 R500 000
Over R500 000
1
2
3
4
5
6
7
122
11. How many of these projects are behind schedule?

None
1 2 projects
3 4 projects
5 6 projects
7 8 projects
12. State the period of schedule overrun if any?
0 6 Months
7 12 Months
13 18 Months
19 24 Months
25 30 Months
31 36 Months
More than 3 years
1
2
3
4
5
6
1
2
3
4
5
6
7
13. What type of construction projects frequently encounter cost overruns? ( you can select more than one option)
Schools
Hospitals
Housing estates
Road construction
Government offices
Stadia
Shopping complexes
Others, specify:
1
2
3
4
5
6
7
8
9
10
14. What type of construction projects frequently experience schedule overruns? ( you can select more than one
option)
Schools
Hospitals
Housing estates
Road construction
Government offices
Stadia
Shopping complexes
Others, specify:
1
2
3
4
5
6
7
8
9
10
123
SECTION B: CAUSES OF CONSTRUCTION PROJECTS COST OVERRUNS

This section of the questionnaire explores the causes of cost overruns on construction projects in South Africa.
To what extent do you agree with each of the following statements? Please indicate your answers using the
following 5-point scale where:
1 = Strongly disagree (SD)
2 = Disagree (D)
3 = Neutral (N)
4 = Agree (A)
5 = Strongly agree (SA)
15. What are the major causes of cost overruns on construction projects in South Africa?
CAUSES OF COST OVERRUNS
SD
1
Contractors inexperience
1
CCO1
2
Inadequate planning
1
CCO2
3
Inflation
1
CCO3
4
Variation order
1
CCO4
5
Change in project design
1
CCO5
6
Project complexity
1
CCO6
7
Shortening of contract period
1
CCO7
8
Insufficient time for estimation
1
CCO8
9
Unstable economy
1
CCO9
10
Shortage of skilled site workers
1
CCO10
11
Shortage of unskilled site workers
1
CCO11
12
Poor project management assistance
1
CCO12
(Professionals/Consultants)
13
Inaccurate estimate
1
CCO13
14
Overdesign
1
CCO14
15
Project site location
1
CCO15
16
Material price fluctuations
1
CCO16
17
Site conflicts among construction parties
1
CCO17
18
Poor workmanship
1
CCO18
19
Inadequate financial provision
1
CCO19
20
Unsteady material supply
1
CCO20
21
Inclement weather condition
1
CCO21
22
Breach of local regulation
1
CCO22
23
Lack of executive capacity by employer
1
CCO23
124
D
2
2
2
2
2
2
2
2
2
2
2
2
N
3
3
3
3
3
3
3
3
3
3
3
3
A
4
4
4
4
4
4
4
4
4
4
4
4
SA
5
5
5
5
5
5
5
5
5
5
5
5
2
2
2
2
2
2
2
2
2
2
2
3
3
3
3
3
3
3
3
3
3
3
4
4
4
4
4
4
4
4
4
4
4
5
5
5
5
5
5
5
5
5
5
5
SECTION C: CAUSE OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS

This section of the questionnaire explores the causes of schedule overruns in construction project delivery time
in South Africa.
To what extent do you agree with each of the following statements? Please indicate your answers using the
1.
= Strongly disagree (SD)
2.
= Disagree (D)
3.
= Neutral (N)
4.
= Agree (A)
5.
= Strongly agree (SA)
16. What are the major causes of schedule overruns on construction projects in South Africa?
CATEGORY
OwnerRelated
DOR1
DOR2
2
3
DOR3
DOR4
DOR5
DOR6
DOR7
DOR8
DOR9
DOR10
4
5
6
7
8
9
10
categories
Contractorrelated
DCR1
DCR2
DCR3
DCR4
DCR5
DCR6
DCR7
DCR8
DCR9
DCR10
DCR11
DCR12
DCR13
DCR14
1
2
3
4
5
6
7
8
9
10
11
12
13
14
CAUSES OF SCHEDULE OVERRUN

Delay in progress payments
SD
1
D
2
N
3
A
4
SA
5
Delay in handing over the site

Change of design by owner during
construction
Late revising and approving of design
documents
Delay in approving shop drawing
Delay in approving sample materials
Poor communication by the client to the
construction team
Poor project coordination
Slowness in decision making process
Suspension of work by owner
1
1
2
2
3
3
4
4
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5

Delays in site mobilization
Difficulties in financing project
Conflicts in sub-contractors schedule in
execution of project
Rework due to errors during construction
Conflicts between contractor and other
parties (Construction team members)
Poor communication
Poor coordination
Ineffective planning and scheduling of
project
Improper
construction
methods
implementation
Delays in sub-contractors work
Frequent change of sub-contractors
Poor qualification of the contractor's
technical staff
Improper method statements
Contractors experience
SD
1
1
1
D
2
2
2
N
3
3
3
A
4
4
4
SA
5
5
5
1
1
2
2
3
3
4
4
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
1
1
2
2
3
3
4
4
5
5
125
Consultantrelated
DCOR1
DCOR2
DCOR3
DCOR4
DCOR5
DCOR6
DCOR7
DCOR8
DCOR9
DMR1
Materialrelated
DMR2
DMR3
DMR4
DMR5
DMR6
DMR7
DMR8
DMR9
DMR10
DMR11
Equipmentrelated
DER1
DER2
DER3
DER4
DER5
Labourrelated
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
10
11
1
2
3
4
5
DER6
DER7
6
7
DLR1
1
2
DLR2
DLR3
DLR4
DLR5
DLR6
DLR7
3
4
5
6
7

Delay in approving major changes in the
scope of work
Poor communication
Poor coordination
Inadequate experience of consultant
Mistakes and inconsistences in design
documents
Delays in producing design documents
Unclear and inadequate details in drawings
Insufficient data collection and survey
before design
Lack of advanced engineering design
software
SD
1
D
2
N
3
A
4
SA
5
1
1
1
1
2
2
2
2
3
3
3
3
4
4
4
4
5
5
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5

Availability of specified construction
materials in market
Changes in material types during
construction
Delay in material delivery
Damage of sorted material while needed
urgently
Fluctuation in material prices
Lateness in materials ordering
Ordering of wrong materials
Delivery of wrong materials
Delivery of sub-standard materials
Inappropriate storage of materials leading to
damages
Availability of improved materials in the
market
SD
1
D
2
N
3
A
4
SA
5
1
1
2
2
3
3
4
4
5
5
1
1
1
1
1
1
2
2
2
2
2
2
3
3
3
3
3
3
4
4
4
4
4
4
5
5
5
5
5
5

Equipment breakdowns
Shortage of equipment
Shortages of skilled operators
Low productivity and efficiency of
equipment
Lack of high-technology mechanical
equipment
Use of obsolete equipment
Use of wrong equipment?
SD
1
1
1
1
D
2
2
2
2
N
3
3
3
3
A
4
4
4
4
SA
5
5
5
5
1
1
2
2
3
3
4
4
5
5

Shortage of labour
Late approval or issuing of work permits for
immigrant workers
Low productivity level of workers
Conflicts among workers
Work attitude of workers
Inexperience of workers
Insecurity by not passing on related work
experience
SD
1
1
D
2
2
N
3
3
A
4
4
SA
5
5
1
1
1
1
1
2
2
2
2
2
3
3
3
3
3
4
4
4
4
4
5
5
5
5
5
126
External
factors
DEF1
DEF2
DEF3
DEF4
DEF5
DEF6
DEF7
Health and
safetyrelated
1
2
3
4
5
6
7
DEF8
DEF9
DEF10
8
9
10
HSR1
HSR2
1
2
3
HSR3
HSR4
HRS5
HSR6
HSR7
HSR8
HRS9
HSR10
4
5
6
7
8
9
10

Effects of subsurface and ground conditions
Delay
in
obtaining
permits
from
municipality
Weather effect on construction activities
Traffic control and restriction at job site
Changes in government regulations and laws
Delay in providing services from utilities
Delay in performing final inspection and
certification
Political interference
Natural disasters
Change in economic factors
SD
1
1
D
2
2
N
3
3
A
4
4
SA
5
5
1
1
1
1
1
2
2
2
2
2
3
3
3
3
3
4
4
4
4
4
5
5
5
5
5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5

Accidents during construction
Death of skilled workers during construction
Death of unskilled workers during
construction
Work stoppages due to not observing H&S
regulations
Poorly updated health and safety files
Use of inappropriate equipment
Non-use of safety equipment at all times
Working in unsafe areas
Insufficient safety officers on site
Workers risky behaviour
SD
1
1
1
D
2
2
2
N
3
3
3
A
4
4
4
SA
5
5
5
1
1
1
1
1
1
2
2
2
2
2
2
3
3
3
3
3
3
4
4
4
4
4
4
5
5
5
5
5
5
SECTION D: EFFECTS OF COST OVERRUNS

This section of the questionnaire assesses the effects of construction project cost overruns.
To what extent are the following likely to be the effects of cost overruns? Please indicate your answers using the
1.
= Extremely unlikely (EU)
2.
= Unlikely (U)
3.
= Neutral (N)
4.
= likely (L)
5.
= Extremely likely (EL)
17. What are the effects of construction projects cost overruns?
ECO1
ECO2
ECO3
ECO4
ECO5
ECO6
ECO7
1
2
3
4
5
6
7
ECO8
EFFECTS OF COST OVERRUNS

Tying down clients capital
Company/firms insolvency
Liability of companies or firms to bad debt.
Under-utilization of manpower resources
Increased project cost due to extension of time
Projects abandonment
Under-utilization of plant and equipment purchased for the
projects.
Construction project delay
127
EU
1
1
1
1
1
1
1
U
2
2
2
2
2
2
2
N
3
3
3
3
3
3
3
L
4
4
4
4
4
4
4
EL
5
5
5
5
5
5
5
SECTION E: EFFECTS OF SCHEDULE OVERRUNS

This section of the questionnaire assesses the effects of construction project schedule overruns in South Africa.
To what extent are the following likely to effects of schedule overruns? Please indicate your answers using the
1.
= Extremely unlikely (EU)
2.
= Unlikely (U)
3.
= Neutral (N)
4.
= likely (L)
5.
= Extremely likely (EL)
18. What are the effects of construction project schedule overrun in South Africa?
EFFECTS OF SCHEDULE OVERRUN
EU
EL
ED1
Extension of Time
ED2
Cost overrun
ED3
Disputes
ED4
Arbitration
ED5
Total project abandonment
ED6
Litigation
ED7
Claims
ED8
Bad reputation with client
ED9
Bad reputation with construction team
ED10
10
Termination of contracts
ED11
11
Loss of profit
ED12
12
Loss of skilled employees
ED13
13
Loss of un-skilled employees
ED14
14
Negative social impact
ED15
15
Idling resources
ED16
16
Delaying the client to repay back bank loans
ED17
17
Poor quality of work due to hurrying the projects
ED18
18
Delaying in getting profit by clients
ED19
19
Bankruptcy of the client
ED20
20
Creates stress on contractors
ED21
21
Creates stress to the client
ED22
22
Acceleration losses
128
SECTION F: MEASURES OF MINIMIZING CONSTRUCTION PROJECT COST OVERRUNS

This section of the questionnaire explores methods to minimizing construction project cost overruns in South
Africa.
To what extent are the following likely to minimise cost overruns on construction projects? Please indicate your
answers using the following 5-point scale where:
1. = Extremely unlikely (EU)
2. = Unlikely (U)
3. = Neutral (N)
4. = likely (L)
5. = Extremely likely (EL)
19. What measures can be taken to minimize construction projects cost overruns?
MEASURES OF MINIMIZING CONSTRUCTION
PROJECT COST OVERRUNS
EU
EL
MMCO1
Appointment of experienced contractor
MMCO2
Adequate planning
MMCO3
Decrease number of variation orders
MMCO4
Completed designs at the time of tender
MMCO5
Allocation of adequate project duration
MMCO6
Proper pre-contract planning
MMCO7
Use of up-to-date technology
MMCO8
Appointment of highly experienced technical consultants
MMCO9
Appointment of highly experienced committed design team
MMCO10
10
Proper project implementation and management
MMCO11
11
Reliable pre-contract estimates
MMCO12
12
Comprehensive client brief development
MMCO13
13
Adequate Designs
MMCO14
14
Allowing for material price escalations in the original

tender document
MMCO15
15
Adequate pre-contract project coordination
MMCO16
16
Good workmanship
MMCO17
17
Employment of experienced site workers
MMCO18
18
Timely supply of material
MMCO19
19
Ordering the right materials
MMCO19
20
Proper implementation of local regulation
MMCO20
21
Use of appropriate construction methods
129
SECTION G: MEASURES TO MINIMIZE CONSTRUCTION SCHEDULE OVERRUNS

This section of the questionnaire explores methods to minimizing construction schedule overruns in South
Africa.
To what extent do you think the following are likely to minimise schedule overruns on construction projects?
Please indicate your answers using the following 5-point scale where:
1. = Extremely unlikely (EU)
2. = Unlikely (U)
3. = Neutral (N)
4. = likely (L)
5. = Extremely likely (EL)
20. What measures can be taken to deliver construction projects on time in South Africa?
WAYS OF MINIMIZING CONSTRUCTION

SCHEDULE OVERRUN
EU
EL
MMD1
Site management and supervision
MMD2
Effective strategic planning
MMD3
Availability of clear information and communication

channels
MMD4
Collaborative working by the entire construction team
MMD5
Proper project planning and scheduling
MMD6
Frequent coordination between the construction team
MMD7
Complete and proper design at the right time
MMD8
Appropriate construction methods
MMD9
Accurate initial cost estimates
MMD10
10
Proper material procurement
MMD11
11
Building according to the construction drawings
MMD12
12
Frequent progress meeting
MMD13
13
Fast-tracking construction
MMD14
14
Use proper and modern construction equipment
MMD15
15
Use up-to-date technology utilization
MMD16
16
Adherence to construction specifications
Thank you for your co-operation in completing this questionnaire and for also helping the construction
industry with the knowledge of construction projects cost and schedule overruns.
130

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COST AND SCHEDULE OVERRUNS ON CONSTRUCTION

MUKUKA JOSEPH MULENGA

Submitted in fulfilment of the requirements for the degree

FACULTY OF ENGINEERING AND THE BUILT ENVIRONMENT

SUPERVISOR: DR. C.O. AIGBAVBOA

CO-SUPERVISOR: PROF. W.D. THWALA

COST AND SCHEDULE OVERRUNS ON CONSTRUCTION

MUKUKA JOSEPH MULENGA

SUPERVISOR: DR. C.O. AIGBAVBOA

CO-SUPERVISOR: PROF. W.D. THWALA

JOHANNESBURG, DECEMBER 2014

Construction projects cost overruns .................................................................................... 1

Construction projects schedule overruns ............................................................................ 2

AIM OF THE STUDY................................................................................................................ 3

PROBLEM STATEMENT ......................................................................................................... 3

OBJECTIVES OF THE STUDY ................................................................................................ 4

MOTIVATION FOR THE STUDY .......................................................................................... 4

PURPOSE OF THE STUDY ...................................................................................................... 4

RESEARCH METHODOLOGY AND DESIGN ...................................................................... 4

RESEARCH METHODOLOGY ............................................................................................ 4

RESEARCH APPROACH AND DESIGN ............................................................................ 5

RESEARCH AREA AND TARGETED RESPONDENTS ................................................... 5

SAMPLING AND DATA COLLECTION ............................................................................ 5

ETHICAL CONSIDERATION .............................................................................................. 5

OVERVIEW OF CHAPTERS .................................................................................................... 6

CHAPTER SUMMARY ............................................................................................................. 7

CHAPTER TWO .................................................................................................................................. 8

OVERVIEW OF THE CAUSES, EFFECTS AND MEASURES OF MINIMISING

CHAPTER INTRODUCTION ................................................................................................... 8

CONSTRUCTION PROJECT COST OVERRUNS .................................................................. 8

CAUSES OF CONSTRUCTION PROJECTS COST OVERRUNS .......................................... 8

EFFECTS OF PROJECT COST OVERRUNS ........................................................................ 10

MEASURE OF MINIMISING PROJECT COST OVERRUNS .............................................. 12

CONSTRUCTION PROJECT SCHEDULE OVERRUNS...................................................... 13

CAUSES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS ............................... 14

Owner-related causes of construction project schedule overruns ..................................... 14

Contractor-related causes of schedule overruns ................................................................ 15

Consultant-related causes of schedule overruns ............................................................... 16

Material-related causes of schedule overruns ................................................................... 17

Equipment-related causes of schedule overruns ............................................................... 17

Labour-related causes of schedule overruns ..................................................................... 18

Causes of schedule overruns by external factors .............................................................. 18

TYPES OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS .................................. 19

Critical Versus Non-Critical schedule overruns ............................................................... 19

Excusable versus non-excusable schedule overruns ......................................................... 20

Compensable versus non-compensable schedule overruns............................................... 20

Concurrent schedule overruns ........................................................................................... 21

EFFECTS OF SCHEDULE OVERRUNS ............................................................................... 22

METHODS OF MINIMISING CONSTRUCTION SCHEDULE OVERRUNS ..................... 24

LESSONS LEARNT ................................................................................................................ 26

CHAPTER SUMMARY ........................................................................................................... 27

CHAPTER THREE ............................................................................................................................ 28

CHAPTER INTRODUCTION ................................................................................................. 28

THE MALAYSIAN CONSTRUCTION INDUSTRY ............................................................. 28

COST AND SCHEDULE OVERRUNS IN MALAYSIA ....................................................... 29

CAUSES OF PROJECT COST OVERRUNS IN MALAYSIA .............................................. 30

MEASURE OF MINIMISING PROJECTS COST OVERRUNS IN MALAYSIA ................ 31

CONSTRUCTION PROJECT SCHEDULE OVERRUNS IN MALAYSIA .......................... 32

CAUSES OF CONSTRUCTION PROJECTS SCHEDULE OVERRUNS ............................. 32

EFFECTS OF CONSTRUCTION PROJECT SCHEDULE OVERRUNS .............................. 33

METHODS OF MINIMISING CONSTRUCTION SCHEDULE OVERRUNS ..................... 34

LESSONS LEARNT ................................................................................................................ 35