In the dynamic world of construction, cost overruns are an all-too-familiar challenge, often leading to significant financial strain and project delays. A recent study published in the journal ‘Rekayasa Sipil’ (Civil Engineering) sheds new light on the factors contributing to these overruns, particularly in toll road projects. Led by Sara Magdalena, a researcher from the Civil Engineering Department at Mercu Buana University in Indonesia, the study employs the Relative Importance Index (RII) to rank the most critical issues causing cost escalations.
The research, which involved quantitative data collection and analysis using SPSS, identified several key factors that significantly impact cost overruns. Topping the list is frequent delays in work, with an RII score of 0.8. “Frequent delays can cascade into a domino effect, affecting subsequent phases of the project and leading to substantial cost increases,” Magdalena explains. “This underscores the need for meticulous planning and timely execution to mitigate such delays.”
Incomplete or inappropriate information and data provided during the project’s initial stages also rank high, with an RII score of 0.7. This highlights the critical importance of accurate and comprehensive information at the outset. “When the information is lacking or incorrect, it sets the project on a shaky foundation, making it prone to cost overruns,” Magdalena notes.
Other significant factors include the slow arrival of materials during implementation, improper project scheduling, and a high frequency of equipment repair. These issues collectively contribute to the 30% cost overrun often seen in construction projects, according to the study.
The study’s findings offer practical control measures to address these issues. Magdalena suggests maintaining detailed records of events and factors contributing to delays, and communicating these to stakeholders along with potential consequences. “By being proactive and transparent, contractors can better manage expectations and mitigate risks,” she advises.
The implications of this research extend beyond toll road projects, offering valuable insights for the broader construction industry, including the energy sector. As infrastructure projects become more complex and costly, understanding and addressing the root causes of cost overruns is crucial. This study provides a roadmap for contractors to enhance project efficiency and financial management, ultimately benefiting both the industry and end-users.
The findings published in ‘Rekayasa Sipil’ (Civil Engineering) are expected to influence future developments in construction cost management. By identifying and addressing key factors contributing to cost overruns, the industry can move towards more predictable and financially stable project outcomes. This research not only highlights the importance of proactive management but also underscores the need for continuous improvement in project planning and execution. As Magdalena’s work gains traction, it could reshape how the construction industry approaches cost management, leading to more efficient and cost-effective projects across various sectors, including the energy industry.