An appraisal of cost management techniques used in the construction industry

Numerous methods of managing cost on projects throughout the project life cycle exist yet construction projects globally are marred with cost overruns, an indicator of poor cost management. A study was conducted to identify cost management tools and techniques used in the various stages of a project in the Zambian Construction Industry (ZCI). A positivist approach was used following in a cross-sectional manner using a self-administered questionnaire for data collection. The respondents were consultants and contractors carrying out the cost management function in their organizations/firms in the construction industry. A total of 118 questionnaires were distributed. The response rate was 79%, and the reliability test using Cronbach alpha of 0.779 was attained. A census was done for consultants and stratified random sampling for medium-large-scale contractors. Analysis was done using descriptive and inferential statistics. Of the various techniques used the most utilized were meetings and expert judgement during the planning phase, detailed estimating and expert judgement during the estimating phase while expert judgement and cost comparisons were used to some extent in the budgeting phase. Cash flow and forecasting were the most utilized in the control phase. Both contractors and consultants were more likely to use subjective cost management techniques.