Ramachandra, T; Rotimi, J O and Gunaratne, S (2014) Reasons for contractors' delay claims failures in Sri Lanka. In: Raiden, A and Aboagye-Nimo, E (eds.) Proceedings of 30th Annual ARCOM Conference, 1-3 September 2014, Portsmouth, UK.
Abstract
Project delays often occur due to the dynamic and complex nature of the construction industry and would lead to claims and disputes between contracting parties. Once a project exceeds the period contractually required to complete a project, there is bound to be an effect on expenditure or income of the contractor as well as the project owner. This study therefore determines the reasons for unsuccessful contractorsÕ delay claims in Sri Lanka. The study administered a questionnaire survey to construction practitioners, contractors and consultants. A total of 55 respondents from both contracting companies (n = 40, with C1-C3 grading) and consultants (n = 15) were selected using stratified random and snowballing sampling methods respectively. The data obtained were analysed using descriptive statistics and Relative Importance Index (RII). The study found that time overrun occurs in 90% of projects in Sri Lanka and was indicative of the delays to settlement of contractorsÕ claims. On average 60% of contractors submitted delay claims with only 40% success rate. The top most frequent reasons for unsuccessful claims include: inadequate documentation to substantiate claims, delayed submission of claim details, failure to establish link between cause and effect of claims and failure to use appropriate delay analysis method. Sri Lankan contractors explained that failure to use appropriate delay analysis method and contractors failing to mitigate the effects of the delays are also contributory factors to failures. In order to mitigate these issues, the study recommends that contractors adopt innovative strategies such as providing a contingency for the amount of claim failures under preliminaries or mark up at bidding stage and includes a measure of over valuation as a negotiating margin when preparing the claim first time. Also contractors would need to maintain up to date records of site transactions, while training of their staff to increase their knowledge of contract procedures are a necessity in Sri Lanka.
| Item Type: | Conference Paper (Paper) |
|---|---|
| Uncontrolled Keywords: | delay claims; reasons for failures; Sri Lanka |
| Index terms: | time overrun, mark-up, contracting party, survey, documentation, construction practitioner, owner, relative importance index, strategy, contributory factor, dispute, Sri Lanka, negotiating, delay analysis, questionnaire, sampling, preliminaries, income, project delay, bidding, construction industry, statistics |
| Subjects: | mathematical modelling, data collection methods, risk assessment, dispute resolution, practitioner, financial and cost management, economic analysis, bidding, management, professional development, Geography, sociology, project controls, conflict resolution, price determination, industry analysis |
| Topics: | Time Control, Legal Issues, Roles and Professions, Stakeholder Management, Risk Management, Procurement, Cost Management, Business Strategy, Geographical Context, Research Practice, Information Management |
| Descriptive scope: | 5 PCTEA |
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