Assessment Of The Factor Affecting The Cost Performance Of The Construction Projects In Nigeria

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Assessment Of The Factor Affecting The Cost Performance Of The Construction Projects In Nigeria


This study investigates the factors affecting cost performance of construction projects in Lagos State located in the south-western part of Nigeria. It draws on relevant previous research in the theory of work on cost performance. Thirty-three contractors companies with different working grades in the state of Lagos were participated in the study. Data were collected from the contractors using a questionnaire survey. The results indicated that the success factors affecting the cost performances of projects obtained by the analyses are identified as project manager competence in works affecting cost performance wholly and commitment responsibilities of all participants and various teams to the project as the top priorities while presence of poor project specific attributes and not existence of cooperate and Ignorance and lack of knowledge in operating, techniques and decision by project manager are identified as the most important failure factors. Further, the analysis indicates that the common factors which affected the cost performance in construction projects are mostly caused of uncertainty as one of the most important factors affecting the performance of the projects followed by the economy condition change.

Chapter One


1.1 Background of the study

Performance indicators are measurable indicators that demonstrate the level of achievement in a project. They provide information to the decision-makers to measure performance and compare them with the intended outputs, outcomes, goals, and objectives, and are chosen to reflect the critical success factors of a project. Cost is one of the most important indicators to consider when measuring contractor performance. Cost is defined as the degree to which the general conditions promote the completion of a project within the estimated budget (Bubashait & Almohawis, 1994). Project total cost is not only confined to tender sum but also include cost of variations, and claims.

Project total cost is the total cost incurred in a project from inception to completion. Cost performance can be measure by comparing contract sum with total project cost to establish if there is cost savings or cost overrun. Cost can be measured in terms of unit cost, percentage of net variation over the final cost (Chan & Chan, 2004). Project performance is generally seen as combination of three factors consists of cost, time and quality. Measuring performance of construction project successful or failure depends on whether it achieves what is required or expected. Cost performance is very importance in project to measure the success of projects begins. The successful or failures of projects in construction industry depend on owners perception towards the actual construction cost and estimated target. If cost project less than the actual planned cost, the project adjudged to be successful. Cost performance is the most importance indicator of project success used by all parties. It presents not only the firms profitability but also the productivity organizations at any point during the construction processes. In fact, there are many criteria and investigation aspects that can be used to measure the successful and failure of any construction project. The past researchers had different perspectives to measure the success and failure projects.

Many causes and factors were identified by researchers measure the project according to work performance and some criteria aspects in construction work and to ensure that project more success, each project participant is supposed to identify and develop effective management practices that contribute to higher performance in their relevant involvement in the construction process.

Generally, the roles will be giving to all parties that will involve in construction such as consultants, contractors, subcontractor, and construction managers and so on. They will be responsible to ensure the work performance and others performance regulated with discipline and criteria rules, they have to avoid the failure of projects. Previous studies had identified some causes and factors called ”attributes” for measuring the failure and success projects. All causes or factors much to affecting the performance in project consist of time, cost and quality of works. This research only presents the factors that affecting cost performance in construction projects in Nigeria.

1.2 Statement of the problem

In construction industry, the results show that in cost performance mostly depend on the management of construction resources, budget management, construction method and communication. Researchers have identify some critical attributes that affecting the cost performance when all criteria and management work for project unsuccessful followed by firms. The most important to all parties to follow the right ways or finding strategy or any method to avoid the failure and carry on the successful of projects.

The critical attribute of failure or success project affecting the cost performance and must to be solved to ensure that success of the project. If these critical attribute not to solved or handled, it with no doubt makes a project failure and properly maybe give much loss to firms. All parties that participated in projects should be taken an action to handle critical attributes and avoid failure of project that will be affecting many thing especially cost performance.

The attributes that have identify by researcher mostly give to successful in project and need to improvement to develop more effective management in construction project and efficiency in project implementation. This study attempts to investigate all failure and success attributes for the construction project in Nigeria.

1.3 Objectives of the study

The goal of this study is to assess the various factors affecting the cost performance of the construction project. Specifically, the study seeks to:

  1. Elucidate on the success factors that affects the cost performance of the construction project.
  2. Highlight the failure factors affecting the cost performance of the construction project.
  3. Recommend the modalities that ensure effective performance of construction project.

1.4 Research Questions

  1. The following questions were considered in this study:
  2. What are the factors responsible for the successful outcome of the construction project?
  3. What are the failure factors hindering effective performance of construction project?
  4. What are the strategies for maintaining the success and failure factors for reach successful project?

1.5 Scope of the study

This study is focused on the external and internal factors that hinders or propels the success of construction projects. The study will serve as an awareness study to numerous research audience on why the country has a lot of abandoned projects both from the federal government, state government and even at the local

Assessment Of The Factor Affecting The Cost Performance Of The Construction Projects In Nigeria

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