Chan, A P C; Lai, M K; Tam, C M and Akintoye, A (2001) Analysis of construction cost variation factors. Journal of Financial Management of Property and Construction, 6(1), pp. 51-60. ISSN 1366-4387
Abstract
Cost variation of construction constitutes a major problem in construction project procurement. It is not uncommon particularly in complex projects for cost of construction to exceed its budget by a wide margin. This paper presents a regression analysis for mitigating contract variations in building projects, the objective being to identify the most influential factors for mitigating contract cost variations. Through a stepwise multiple regression analysis involving respondents from the Hong Kong construction industry, it is found that reduction of cost variations can be achieved through a clearer and more thorough detailing of design, better communication and co-operation between team members, simple and traditional procurement arrangement, and the appointment of an independent cost manager for cost control.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | contract cost variations, regression analysis, influential factors |
| Index terms: | Hong Kong, construction cost, traditional procurement, cost manager, complex project, construction industry, regression analysis, cost control, construction project, variation, influential factor, multiple regression analysis |
| Subjects: | risk assessment, financial and cost management, contractual condition, professional development, industry analysis, statistical analysis, contractual arrangements, strategic project management, production management, Geography |
| Topics: | Cost Management, Information Management, Research Practice, Contract Administration, Risk Management, Procurement, Project Management, Geographical Context |
| 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