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North American Academic Research , Volume 2, Issue 10; October 2019; 2(10) 43-61 ©TWASP, USA 43

North American Academic Research

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Research Factors Affecting Cost Overrun in Construction Projects in Zimbabwe

Tafadzwa Natasha Mavengwa

1*, Dinesh Sukamani (PhD)

2, Mkhokheli Nyoni

3

1School of Civil Engineering and Architecture,, Wuhan Institute of Technology

2School of Civil Engineering and Architecture, Department of Construction Management,

Wuhan University of Technology 3School of Civil Engineering and Architecture, Wuhan Institute of Technology

*Corresponding author

Accepted: 13 October, 2019; Online: 14 October, 2019

DOI : https://doi.org/10.5281/zenodo.3489806

I. Introduction

Cost overrun is a problem common in the construction sector over the years. Cost

performance of an organization plays a very important criterion in evaluating the success of

construction projects. Hence, it is important to establish the vital causes of cost overrun in-order

to understand the factors that can affect cost performance. The definition of the word cost

overrun is when the cost completion exceeds the original cost(Avotos, 1983).

Abstract: This study aims to investigate and identify the factors that cause cost overrun in

construction projects in Zimbabwe. To achieve the aim of this paper the following was done:

identifying different factors that lead to cost overrun, collecting and analyzing questionnaires

from the respondents and ranking the data according to its significance. The factors of cost

overrun were ranked which, listed out the top ten factors. The top ten factors of cost overrun

were: financial difficulties, currency changes, poor contract management, material price

fluctuation, laws and regulations, poor feasibility and project analysis, delay in decision

making, foreign labor permits, political interference and delay in approving design

documents. The research assists in providing a better understanding of the factors of cost

overrun in construction projects in Zimbabwe. The data was used to rank the factors

according to their importance and also find the difference between the public and private

sector using ANOVA test.

Keywords: Cost overrun, construction projects, Zimbabwe, cost performance, ANOVA, RII

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In Zimbabwe, both public and private sector construction projects are epitomized by cost

overrun. Zimbabwe’s construction projects have had tempestuous cost performance difficulties.

Construction sector of Zimbabwe is also characterized by incomplete projects and different

reasons. The construction sector contributes significantly to the growth of a country and it also

stimulates it’s social and economic development. The construction sector also contributes to the

gross domestic product (GDP), improvement and also provides the required infrastructure to

upgrade standards of living. The GDP of construction sector industry at current price in 2017

according to percentage distribution is 2. 3% and according to rates of percentage growth is 12.

5%. At a constant price, percentage contribution is 2. 4% and the rate of percentage growth is 3.

9%. The study indicated that the construction sector’s GDP of 2018 is anticipated to grow as

high as 15%. Sustainable, stable for the development and growth of construction industries is of

great importance, under-propelling recovery and economic growth. It has a multiplier influence

on the wide economy (Durdyev, Omarov, Ismail, & Lim, 2017). Due to the various obstacles

faced by the county of Zimbabwe in its construction sector, BMI research will only grow by an

average of 5 percent in the next five years, Fitch Group organization has reported. Richard

Marshal Research BMI Research the Head of the Infrastructure stated that the industry has been

pretentious by the decline of the economy over the years (Ndlovu-Gatsheni, 2008). Zimbabwe's

infrastructure department was a victim of Zimbabwe's restricted economic fiscal affair.

Zimbabwe's construction sector organizations lament how the government interrupts in favor of

foreign firms. Zimbabwe's construction sector prerequisite for improving production and

operation for about $350 million. In Zimbabwe, construction firms are trapped between stagnant

productions and shrinking profit margins, this connotation that construction sector is impotent to

generate required profits to invest critical processes and new technology.

II. Aim of the study

Therefore, the goal of this research is to recognize and rank critical factors that cause cost

overrun in construction industry in Zimbabwe. Fundamental research questions are what is the

cost overrun? What are the causes of overrun costs? How is the overrun measured? How are the

causes of cost overrun ranked?


III. Objective

1. Identify the causes of cost overrun in construction projects in Zimbabwe.

2. Identify strategic measures for successful construction projects in Zimbabwe.

3. Determine relative rank in terms of the significance of each cost overrun in Zimbabwe.

IV. Literature review

Some factors may seem unimportant for construction projects, while others prove to be very

important for construction projects as conditions are not always the same. Cost overruns have

been experienced by many construction companies over the years. In 1991 to 2008, an ANOVA

test was carried out to investigate the different types of construction cost and of schedule overrun

project size (Shrestha, Burns, & Shields, 2013). This concluded that various large-scale projects

have a significantly higher cost and schedule overrun than projects of smaller size and duration.

The construction sector looks more at cost performance than time performance. The study found

that costs were very close to the target while the duration of the project surpassed the target

(Olawale & Sun, 2010). This shows that the profitability and productivity objective of the

construction organization is highly dependent on cost performance. The aim of the researcher is

to identify the main factors causing cost overruns in construction projects such as fluctuations in

the material price, inaccurate estimates, high labor costs, complexity of the project, adverse

weather and changing regulations (Kaming, Olomolaiye, Holt, & Harris, 1997). Chang Indicated

two causes of an increase in the cost of construction design projects (change in range and extra

work)(Chang, 2002). Established that three outstanding cost overrun factors are poor site

management, poor supervision also financial difficulties and fluctuation of material

prices(Rahman, Memon, & Karim, 2013).

Previous author carried out a survey showing three factors affecting cost overrun which are

faulty design, site condition dissimilar, and arrangement change (Moura, Teixeira, & Pires,

2007). The groundwater project study conducted in Ghana identified five outstanding cost

overrun factors indicating an increase in material prices, poor contractor management, material

procurement, monthly agency payment difficulties and poor technical performance (Frimpong,

Oluwoye, & Crawford, 2003). A previous researcher conducted a study on infrastructure delays

and cost escalation in Nigeria of factor cost overruns are design changes, shortage of materials,

poor contract management, payment of finished works and bad weather (Omoregie & Radford,


2006). The study on road construction in Zambia identified causes of cost overruns that are bad

weather, changes in scope, delays in schedules, inflation, strike, and technical problems (Kaliba,

Muya, & Mumba, 2009). Investigated that overrun rates in road construction projects from 1994

to 2009 are 5.5 percent and 10.43 percent respectively (Akoa, 2011). In Botswana, the evaluation

of the cost performance of public projects research showed four categories that are the most

significant causes of cost overrun: variation, contractual claims, labor cost fluctuation, as well as

materials and measurements of temporary works (Chimwaso, 2000). Found that the cost factors

in Pakistan's construction industry are price fluctuations, poor site management and lowest

procurement procedures(Azhar, Farooqui, & Ahmed, 2008) . In Nepal, the researcher studied

factors affecting the performance of small hydro-power construction projects as quality control

of materials, insufficient supply of materials, overall management action(Chiluwal & Mishra,

2017).

An absolute review of literature identifies nine major cost overrun factors and about 63 of

their sub-factors as shown in table 1.

Table 1

Factors that cause overrun costs

NO Main

factors

N0 Related cost factors REFERENCES

1 Client C1 Financial difficulty (Famiyeh, Amoatey, Adaku, &

Agbenohevi, 2017; Polat, Okay, & Eray,

2014)

C2 Poor communication (Asiedu & Alfen, 2015; Famiyeh et al.,

2017)

C3 Delay in decision making (Al-Hazim, Salem, & Ahmad, 2017;

Famiyeh et al., 2017; Niazi & Painting,

2017; Polat et al., 2014)

C4 Changes of orders

delayed by the client

(Park & Papadopoulou, 2012)

C5 Delay in approving design

documents

(Niazi & Painting, 2017)

C6 Unrealistic contract

duration

(Famiyeh et al., 2017; Niazi & Painting,

2017)

C7 Work suspension by

client


2 Consultan

t

CO1 Project design complexity (Niazi & Painting, 2017)

CO2 Poor supervision (Famiyeh et al., 2017)

CO3 Slowness in giving

instruction

(Famiyeh et al., 2017)

CO4 Poor feasibility and (Famiyeh et al., 2017)


NO Main

factors


project analysis

CO5 Mistakes and

discrepancies in design

documents

(Al-Hazim et al., 2017; Niazi &

Painting, 2017)

CO6 Conflicts amongst

consultant and other

parties


CO7 Delay in reporting the

progress of works done


CO8 Inaccurate estimates (Famiyeh et al., 2017; Park &

Papadopoulou, 2012)

CO9 Poor contract

management

(Doloi, Sawhney, Iyer, & Rentala, 2012;

Park & Papadopoulou, 2012)

CO10 Delay in reviewing the

design documents


2017)

CO11 Lack of sufficient

experience of consultant


3 Material M1 Shortage of material (Asiedu & Alfen, 2015; Park &

Papadopoulou, 2012)


M2 Equipment productivity (Niazi & Painting, 2017)

M3 Material price fluctuations (Al-Hazim et al., 2017; Frimpong et al.,

2003; Kaliba et al., 2009)

M4 Equipment choice (Niazi & Painting, 2017)

M5 High transportation cost

of construction materials

(Wanjari & Dobariya, 2016)

M6 Equipment failure (Niazi & Painting, 2017)

M7 Delay in material delivery (Niazi & Painting, 2017)

M8 Construction equipment

shortage


M9 Poor material handling on

site


M10 Low quality of materials (Famiyeh et al., 2017)

M11 Poor procurement

programming of material


M12 Inappropriate or misuse of

materials


4 Labor L1 Low productivity of labor (Niazi & Painting, 2017)

L2 Overtime issues (Niazi & Painting, 2017)

L3 Shortage of technical staff (Niazi & Painting, 2017; Park &

Papadopoulou, 2012)

L4 High cost of labor (Niazi & Painting, 2017; Wanjari &

Dobariya, 2016)

L5 Weak motivation (Niazi & Painting, 2017)

L6 Labor nationality (Niazi & Painting, 2017)

L7 Conflict between labor (Niazi & Painting, 2017)

5 Contractor CON1 Poor financial (Famiyeh et al., 2017; Niazi & Painting,


NO Main

factors


management on site 2017)

CON2 Lack of sub-contractor

skills


2017)\

CON3 Project schedules delays (Famiyeh et al., 2017)

CON4 Mistakes during

construction by

contractors


CON5 Often changing sub-

contractors


CON6 Delay in site mobilization (Niazi & Painting, 2017; Polat et al.,

2014)

CON7 Poor coordination

between contractor and

subcontractor


6 Governm

ent

G1 Slow permits by

government agencies


G2 Bureaucracy in

government agencies


G3 Political interference (Famiyeh et al., 2017)

G4 Strikes legal disputes

between parties


7 External E1 Bad weather (Al-Hazim et al., 2017; Famiyeh et al.,

2017)

E2 Currency changes (Niazi & Painting, 2017; Park &

Papadopoulou, 2012)

E3 Natural disasters (Niazi & Painting, 2017)

E4 Building codes (Niazi & Painting, 2017)

E5 Corruption (Niazi & Painting, 2017; Park &

Papadopoulou, 2012)

E6 Laws and regulations

changes


2017)

E7 Foreign labor permits (Niazi & Painting, 2017)

E8 Restrictions at job site (Niazi & Painting, 2017)

E9 Material price changes (Frimpong et al., 2003)

E10 Effect of social and

cultural factors


8 Quality Q1 Reworks (Polat et al., 2014)

Q2 Penalties resulting from

low quality

(Polat et al., 2014)

Q3 Unclear technical

specifications

(Polat et al., 2014)

9 Contractu

al

CONT1 Project delays (Famiyeh et al., 2017)


NO Main

factors


CONT2

2 Environmental protection (Famiyeh et al., 2017)

V. Research methodology

A questionnaire survey and literature review identified the major factors that cause cost

overrun on Zimbabwe's construction projects. A questionnaire was designed with approximately

37 cost overrun questions chosen from table 1. The purpose of this questionnaire was to assume

the knowledge of factors causing cost overrun in Zimbabwe by experienced personnel. The

research also plays a major role in collecting past studies on cost overrun factors. For various

reasons associated with it, the questionnaire was used, for example, to communicate with people

in different regions than face to face interview. The questionnaire is made up of three main parts.

The purpose of the first part was to collect information about the demographic information of the

respondent, the second part contends with the work description of the respondent and the third

part was about the main questions about the causes of the cost overrun. Ordinal Likert scale

measurements for level of significance from 1 to 5, depending on the level of contribution used

where 1-is not significant; 2-slightly significant; 3-moderately significant; 4-very significant and

5-extremely significant. In order to rank the factors that caused cost overrun with regard to

Zimbabwe's construction projects, the factor rating was important.

Table 2

Summary of the survey findings

Parameter values

Number of distributed questionnaires 70

Number of invalid questionnaires 2

Number of received responses 50

Percentage of received responses (%) 71.4


VI. Relative importance index

The method RII shows the ranking of each factor according to their importance. This method

was employed to determine the main causes of cost overrun. RII method is evaluated using the

below equation:

AN

WRII

(1)

Where,

RII-the relative importance index

W- Weighting given to each factor by respondent and the scope from 1-5

A- Highest weight

N-total number of respondents

Table 3

Rank of factors of cost overrun

S.N Main factors Related cost factors Rank RII

1 Client Financial difficulty 1 0.89

Delay in decision making 2 0.839

Delay in approving design documents 3 0.769

Unrealistic contract duration 4 0.604

Poor communication 5 0.412

2 Consultant Poor contract management 1 0.878

Poor feasibility and project analysis 2 0.847

Poor supervision 3 0.71

Project design complex 4 0.671

Slowness in giving instruction 5 0.573

3 Material Material price fluctuations 1 0.875

Shortage of material 2 0.737

Construction equipment shortage 3 0.636

High transportation cost of construction

materials

4 0.588

Low quality of materials 5 0.553


S.N Main factors Related cost factors Rank RII

Equipment failure 6 0.467

Inappropriate or misuse of materials 7 0.396

4 Labor Labor nationality 1 0.714

Shortage of technical staff 2 0.4

Overtime issues 3 0.388

Low productivity of labor 4 0.373

Weak motivation 5 0.337

5 Contractor Mistakes during construction by

contractors

1 0.698

Poor coordination 2 0.42

Lack of sub-contractor skills 3 0.384

6 Government Political interference 1 0.776

Bureaucracy in government agencies 2 0.671

7 External Currency changes 1 0.886

Laws and regulations changes 2 0.855

Foreign labor permits 3 0.804

Corruption 4 0.765

Material price changes 5 0.722

8 Quality Unclear technical specifications 1 0.729

Reworks 2 0.541

Penalties resulting from low quality 3 0.467

9 Contractual Project delays 1 0.62

Environmental protection 2 0.404

VII. Data evaluation

Table 3 shows 9 main factors, per each main factor, are sub-factors which are ranged

according to their importance. Based on the findings the results are presented in Table 4 which

shows the top 10 causes of cost overrun in construction projects in Zimbabwe. According to the

ranking results, the 1st ranked top factor are financial difficultly by the client with an RII value


of 0. 89. This factor in table 3 the RII score is ranked the 1st. Financial difficulties is the main

problem that causes cost overrun in the Zimbabwe construction project sector. Due to Zimbabwe

facing economic instability, the financial difficulties can be imputed by the contemporaneous

liquidity crisis of the economy. In accordance with the reviews, the main source of financial

difficulties has not been identified (Al-Khalil and Al-Ghafly 1999: Frimpong and Oluwoye

2003). The 2nd ranked factor is currency changes with an RII value of 0. 886. It is under the

external factor, which in table 3 shows that it has a high contribution to cost overrun projects. In

Zimbabwe, various methods have been introduced to solve problems. Zimbabwe introduced a

new currency which outwardly pegged to the US dollar for bond notes and coins. Currency

changes and inflation rate they have a highly important impact on the cash flow of a project;

thus, it leads to affecting cost overrun projects. Poor contract management factor which is ranked

3rd with an RII of 0. 878. This factor is under consultant and in table 3 it is rated as the most

significant impact on the cost overrun construction projects in Zimbabwe. The act of not

monitoring the contract after it has been signed leads to cost overrun problems. The 4th ranked

factor is material price fluctuation its RII value is 0. 875. From table 3 it has proved to have an

important impact on cost overrun construction projects on Zimbabwe. This factor has a high

impact on large projects than smaller projects. On a large construction project, it will be difficult

to deal with the effects of inflation. Market price fluctuation is mainly caused by a shift in

demand, a shift in supply and government regulation. In Zimbabwe, there is a low supply of

material which leads to price fluctuation. This factor is under material related factors. Laws and

regulations, this factor is ranked as the 5th with an RII of 0. 855. It is categorized in external

related factors. In table 3 it is ranked as the 2nd significant factor under external factors. The 6th

important factor ranked is poor feasibility and project analysis, with an RII value of 0. 847. In

table 3 it is ranked as the 2nd significant factor. This factor in (Kometa et al 1994)’s study

indicated that it has an impact on construction firms. It is categorized under the consultant. The

last four factors are a delay in decision making, foreign labor permits, political interference and

delay in approving design documents. Delay in decision making in table 3 is rated as the 2nd

important factor which is categorized under client. Its RII value is 0. 839. The study on Ghana’s

construction sector indicated this has an impact. (Frimpongs et al 2003). The factor foreign labor

permits in table 3 in ranked the 3rd under external related factor, with an RII of 0. 804. Political

interference is 2nd from the last factor with an RII of 0. 776. In table 3 it is the 1st under


government-related factors. The delay in approving design documents results in cost overrun.

The finding is further support by （Al-Hammadi and Nawab 2016).

Table 4

Top ten ranked factors of cost overrun

RANK MAIN FACTOR SUB FACTOR RII

1 Client Financial difficulty 0.89

2 External Currency changes 0.886

3 Consultant Poor contract management 0.878

4 Material Material price fluctuation 0.875

5 External Laws and regulations 0.855

6 Consultant Poor feasibility and project analysis 0.847

7 Client Delay in decision making 0.839

8 External Foreign labor permits 0.804

9 Government Political interference 0.776

10 Client Delay in approving design documents 0.769

Table 4 shows the client and external factors having 3 sub factors in the top 10 factors of cost

overrun. The client factors are financial difficulty, delay in decision making and delay in

approving design documents. These client factors may cause the project to be delayed. The

external factors are currency changes, laws and regulations and foreign labor permits.

VIII. Analysis of variances

The ANOVA (analysis of variances) test was used to determine and compare if their

dissimilarities are statistically important. Independent variables of the two groups were used to

compare. The two groups are the public and private sectors. When comparing two samples we

use t-test (independent sample) which gives the same results as ANOVA test. The ANOVA test

assumes that the variety of all the errors equal to each other. The conclusion is drawn using the F

value.

Table 5

ANOVA test

Sum of

Squares df

Mean

Square F Sig.


Sum of

Squares df

Mean

Square F Sig.

C1 Between Groups .073 1 .073 .130 .720

Within Groups 26.132 47 .556

Total 26.204 48

C2 Between Groups 1.960 1 1.960 1.487 .229

Within Groups 61.958 47 1.318

Total 63.918 48

C3 Between Groups .016 1 .016 .023 .880


Total 32.000 48

C4 Between Groups 1.490 1 1.490 1.420 .239


Total 50.816 48

C5 Between Groups .097 1 .097 .039 .844


Total 116.490 48

CO1 Between Groups .296 1 .296 .259 .613


Total 54.000 48

CO2 Between Groups 4.718 1 4.718 2.567 .116


Total 91.102 48

CO3 Between Groups 2.552 1 2.552 2.917 .094


Total 43.673 48




Sum of

Squares df

Mean

Square F Sig.

Total 10.776 48



Total 12.245 48

M1 Between Groups 2.383 1 2.383 3.980 .052


Total 30.531 48

M2 Between Groups .147 1 .147 .312 .579


Total 22.245 48

M3 Between Groups .013 1 .013 .011 .915


Total 52.980 48

M4 Between Groups .012 1 .012 .015 .902


Total 35.633 48

M5 Between Groups .037 1 .037 .047 .830


Total 37.061 48

M6 Between Groups .191 1 .191 .119 .731


Total 75.347 48

M7 Between Groups 1.375 1 1.375 1.387 .245


Total 48.000 48

L1 Between Groups 1.306 1 1.306 1.642 .206


Sum of

Squares df

Mean

Square F Sig.


Total 38.694 48

L2 Between Groups .516 1 .516 .619 .435


Total 39.673 48

L3 Between Groups .490 1 .490 .475 .494


Total 48.980 48

L4 Between Groups .028 1 .028 .073 .788


Total 18.000 48

L5 Between Groups 2.688 1 2.688 1.429 .238


Total 91.102 48

Con1 Between Groups .180 1 .180 .269 .606


Total 31.673 48

Con2 Between Groups .373 1 .373 .237 .629


Total 74.204 48

Con3 Between Groups 1.334 1 1.334 1.060 .309


Total 60.490 48

G1 Between Groups .112 1 .112 .068 .796


Total 78.000 48


Sum of

Squares df

Mean

Square F Sig.

G2 Between Groups 1.960 1 1.960 1.441 .236


Total 65.918 48

E1 Between Groups .030 1 .030 .021 .885


Total 67.102 48

E2 Between Groups .008 1 .008 .023 .879


Total 16.245 48

E3 Between Groups 1.134 1 1.134 2.176 .147


Total 25.633 48

E4 Between Groups 1.084 1 1.084 1.007 .321


Total 51.673 48

E5 Between Groups .928 1 .928 1.116 .296


Total 40.000 48

Cont1 Between Groups 1.225 1 1.225 1.016 .319


Total 57.918 48

Cont2 Between Groups .001 1 .001 .002 .965


Total 31.959 48

Q1 Between Groups .387 1 .387 .576 .451



Sum of

Squares df

Mean

Square F Sig.

Total 31.959 48

Q2 Between Groups 1.447 1 1.447 .954 .334


Total 72.694 48

Q3 Between Groups .682 1 .682 .473 .495


Total 68.408 48

IX. Further research

The ANOVA test was analyzed using two samples, namely public and private sector. The

data collected amounted to 50 responses 29 under private sector and 21 under public sector. Null

hypothesis is that there are no significant differences between the public and private sector in the

opinion of factors of cost overrun in construction projects in Zimbabwe. The cost overrun of two

groups shown above in table 5 was statistically important at a significant level of 0. 05. the

opinion of the construction professionals concludes that both private and public sector are

affected by the same factors of cost overrun.

X. Conclusion

This study investigated the cause of cost overrun in construction projects in Zimbabwe. In

the literature review, about 10 main factors and about 63 sub-factors were identified. From the

judgment of the respondents in Zimbabwe, showed that the top ten factors of cost overrun are

financial difficulties, currency changes, poor contract management, material prices fluctuation,

laws and regulations, poor feasibility and project analysis, delay in decision making, foreign

labor permits, political interference and delay in approving design documents. These factors

were approved by using the RII (relative importance index) method to rank the factors according

to their importance. The ANOVA test method was also used to analyze the data between the two

groups (public and private sector). It showed that between public and private sector they are

equal due to the level of significance being above 0. 05. The findings of this study will help to


improve and also understand the deep roots of the cause of overrun in construction projects in

Zimbabwe. This study will also help prevent project failure.

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Tafadzwa Natasha Mavengwa, 22 years old, Studying Civil engineering

undergraduate at Wuhan institute of technology China. She is a Zimbabwean

© 2019 by the authors. ASU ,YN ,PSAWT. Author/authors are

fully responsible for the text, figure, data in above pages.

This article is an open access article distributed under the

terms and conditions of the Creative Commons Attribution

(CC BY) license (http://creativecommons.org/licenses/by/4.0/)

http://creativecommons.org/licenses/by/4.0/

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