Annamalaisami, C D and Kuppuswamy, A (2022) Reckoning construction cost overruns in building projects through methodological consequences. International Journal of Construction Management, 22(6), pp. 1079-1089. ISSN 1562-3599
Abstract
The construction cost is considered as the most important parameter to analyze the project success. It is essential to measure the variance from the budgeted cost to understand the cost impact on project performance and profitability. Though sufficient knowledge on cost overrun has been largely shared in the extant literature, it is not adequately explained why the cost overrun keeps occurring. Hence it is necessary to investigate the relationships among cost overrun factors to improve current construction cost and controlling practices. A conceptual framework is proposed based on causal mapping, systemic and scenario understandings. The traditional forecasting methods such as trend analysis, regression models are dependent on the history while predicting the future, whereas the scenario planning and cause mapping approach suggest the alternative for the future up comings and make ready for anticipating changes. With overwhelming statistical and cognitive significance, it is evident that the cost overrun risk indicators caution the project managers in the execution of building projects. From the findings of this study, decision-makers can act on early warnings of cost variances and commendably mitigate cost overruns. The findings are expected to bridge the gap in the current construction cost management practices.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | cognitive map; construction cost overrun; cost overrun causes; project performance |
| Index terms: | cost variance, profitability, project performance, scenario planning, cost overrun, construction cost, project success, project manager, causal mapping, forecasting, variance, regression model, history, conceptual framework, mapping, management practice, early warning, overrun |
| Subjects: | profession, prediction and forecasting, economic analysis, financial and cost management, architectural and construction history, financial risk, project management theory and practice, theoretical framing, management, spatial and geospatial analysis, systems engineering, statistical analysis, financial analysis, project controls, measurement and scaling |
| Topics: | Time Control, Research Practice, Project Management, Engineering Principles, Business Strategy, Cost Management, Roles and Professions |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here