Risks of inadequacies of inputs of preconstruction activities to design phase on cost and time overruns in construction projects

Abstract

Cost and Time overruns are common occurrences in construction projects completed in Sri Lanka. This research study was carried out to find the possible reasons for these overruns. The objectives of the study were to review, identify and analyze risks created by the inadequacies, correlations, coherence and accuracy of the input data of pre-construction activities to the design phase of construction projects and to develop and validate an industry best practice framework/model/guideline to minimize/eliminate cost and time overruns of construction projects due to risks of inadequacies, correlations, coherence and accuracy of the inputs of pre-construction activities to the design phase of the projects. Initially, contributory factors for Cost and Time overruns of construction projects were identified. ‘Design effects’ was found to be the critical contributory factor. A study on ‘Design effects’ identified the pre-construction activities that are input to the design phase of construction projects. These pre-construction activities were used to examine ‘Relevance of the activity’ and ‘Adequacy of the input of the activity’ to the design phase in a construction project. Accordingly, a model, “z = 100 - 2.6916e0.024x” where ‘Inadequacy of the input to the design phase (z)’ and ‘Relevance of a pre-construction activity (x)’ was derived for the input of a pre-construction activity to design phase of a construction project. Pre-construction activities were expanded and analysed to assess the risks created by inadequate inputs from the pre-construction activities to the design phase of construction projects as follows. Scientifically developed questionnaires based on the mixed type of research method and where internal consistency was rated as ‘excellent’ were used for data collection. The probabilistic random sampling method confirmed that the sample of respondents selected for the study was adequate. One questionnaire was used to collect data from 32 projects to examine ‘Relevance’ and ‘Adequacy’ of input from pre-construction activities to the design phase of construction projects. The other questionnaire was used to collect data from 100 projects to examine the possibility of eliminating/minimising the Risk of Cost overruns and Risk of Time overruns by retaining services of a third-party independent designer to verify the adequacies of input from preconstruction activities to the design phase of construction projects. All respondents to the questionnaires were substantive experts actively involved in construction projects. A structure to collect data was developed to identify and analyze risks from the input of respective pre-construction activities to the design phase of construction projects. The developed framework analysed risks using Risk Matrix, Relative Importance Index (RII), Severity Index (SI), Descriptive Statistics, Sampling Adequacy, Reliability, Validity, Correlation and Accuracy of data, Biases, Coherence of responses and Calibration of respondents. Guideline for industry best practice was derived by using scientific techniques of data analysis for risks created by the inadequacies of input from respective pre-construction activities to the design phase of construction projects. Results from the analysis satisfied the limits set by each scientific technique used for the analysis. The analysis highlighted the ranks of preconstruction activities which with inadequate input to the design phase of construction projects increased the Risk of exceeding Cost, Risk of exceeding Time and minimising the Risk of exceeding Cost and Time. Risk interpretation revealed that top ranks of preconstruction activities were ‘Likely’ to induce Risk of exceeding Cost and Risk of exceeding Time of construction projects. Guideline for industry best practice was validated through statistical methods and Case studies from the construction industry. The main conclusions of the study were that: i) Inadequacies of input from preconstruction activities to the design phase contributed towards Cost overruns and Time overruns in construction projects; ii) Risks created by the inadequacies, correlations, coherence and accuracy of the input data of pre-construction activities to the design phase of construction projects contributed towards Cost overruns and Time overruns in construction projects and iii) Verification of the input from preconstruction activities to the design phase of construction projects by a third party independent designer would minimise the Risk of exceeding Cost and the Risk of exceeding Time of Construction projects. In addition to the 3 main conclusions described above, there were 19 conclusions and 3 recommendations.