The Effect Of Contract Planning On Construction Project Performance

Project and Seminar Material for Quantity Surveying QS

The Effect Of Contract Planning On Construction Project Performance


Abstract


This study examines contract planning on construction projects from clients’ perspective and its effects on performance. The objectives are to determine the contract planning practices applied in the Nigerian construction industry, assess the awareness and usage of contract planning tools and techniques applied by clients on construction projects, evaluate factors affecting contract planning practices on construction projects and determine its effects on performance of construction projects.

A cross-sectional design was employed where both qualitative and quantitative methods were used in the study. The targeted sample size was 132 respondents out of a total population of 241 road construction stakeholders. The findings indicated that there was a significant positive relationship between monitoring intensity, risk management, evaluation and performance of road construction projects in the study context.

The performance of the road construction projects in Imo State was more related to the availability and use of resources which include funding, human resources and the basic raw materials used in the construction process which results into delays, cost overruns and poor quality service. Based on these study findings it is therefore recommended that Imo State should commit more resources to evaluation and risk management to realize higher level of service delivery in the road construction sector.


Table Of Contents


Preliminary Page(s)

  • Title page
  • Certification page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of content

Chapter One

Introduction

  • 1.1 Background of the Study
  • 1.2 Problem Statement
  • 1.3 Research Questions
  • 1.4 Aim and Objectives of the Study
  • 1.5 Significance of the study
  • 1.6 Scope of the study
  • 1.7 Justification of the study
  • 1.8 Operational definitions
  • 1.9 Organization of Study

Chapter Two

Literature Review

  • 2.1 Introduction
  • 2.2 Theoretical review
  • 2.3 Conceptual Review
  • 2.3.1 Monitoring intensity and project performance
  • 2.3.2 Risk Management and Project Performance
  • 2.4 Review of the empirical studies and synthesis of Literature Review

Chapter Three

Methodology

  • 3.1 Introduction
  • 3.2 Research Design
  • 3.3 Study Population
  • 3.5 Sources of Data
  • 3.6 Data Collection Instruments
  • 3.7 Data Analysis
  • 3.7.1 Quantitative Data Analysis
  • 3.7.2 Qualitative data

Chapter Four

Presentation Of The Study Findings

  • 4.1 Introduction
  • 4.2 The response rate
  • 4.3 Background Information Of The Respondents
  • 4.4 Monitoring Intensity And Performance
  • 4:5 Risk Management And Performance
  • 4.6 Evaluation And Performance

Chapter Five

Discussion Of The Findings, Conclusions And Recommendations

  • 5.1 Introduction
  • 5.2 Discussion of the findings
  • 5.3 Conclusions
  • 5.4 Recommendations
  • References

Chapter One


Introduction

1.1 Background of the Study

Ashworth, Hogg, and Higgs (2013) described the construction industry as one of the most important sectors of the economy, which integrates a wide variety of skilled and unskilled professionals. These professionals engage in the provision of goods and services ranging from construction, alteration, refurbishment to repairs of building and civil engineering structures. All these professionals work together under various types of contractual agreements to actualize the client’s brief and deliver the project. Each construction project is unique and has its main objectives are outlined by the client based on project circumstances. Amongst the most common objectives of any successful project are deliveries at the right time, within authorized cost and meeting the envisaged quality standards (Love 1998). Construction projects, like all others, are not risks free and thereby can result to financial loss. Construction risks are events that generally influence any or all of the project objectives. Risk events could either be positive in terms of opportunities or negative in terms of threats to either or the entire project objectives (Hillson 2002).

Significant proportions of factors impeding project performance in the construction industry are traceable to actions and inaction of principal stakeholders in the sectors. One aspect where stakeholders have failed in its responsibilities relates to contract planning. Contract planning According to Simmons (2007), refers to the process of systematically and efficiently managing contract creation, execution and analysis for maximizing operational and financial performance and minimizing risk. Contract planning processes are the activities/steps taken during contract planning, this is divided into two (2) phases PMT (2006) which are the pre-contract planning and post-contract planning on clients perspective and contractors perspective, but in the cause of this project we will be looking at the clients perspective, The research literatures in construction project management is replete with concerns about poor or ineffective contract planning (Idoro, 2009; Idoro, 2012; & Dalibi, 2016). Most countries in the Middle-East and some part of Africa do not utilize project planning and management techniques in the delivery of construction projects (Sayegh, 2008; Laryea & Hughes, 2009). Ashworth (2007) reported that the use of formal contract planning and management techniques in the UK construction industry is low. The result culminates in project failures, incessant claims for variations, huge financial losses and sometimes results in bankruptcy of Clients and Contractors Ashworth (2007).

Several academic and professional literatures have developed in the field of effective contract planning and management within construction contexts. The degree of application of contract planning and management techniques by contractors especially, was found to differ in various construction industries across the globe (2008). Against this literature gap therefore, this study is conducted to evaluate the effect of construction contract planning on project performance in Imo State.


1.2 Problem Statement

Contract planning in construction projects is bedeviled with chronic inefficiencies that influence the performance of project delivery. These protracted outcomes are a result of two possible concern, low awareness and usage, and exogenous and endogenous factors influencing contract planning. Ashworth (2007) reported that the use of formal contract planning and management techniques in the UK construction industry is low. The result culminates in project failures, incessant claims for variations, huge financial losses and sometimes results in bankruptcy of Contractors Ashworth (2007). This situation is more prevalent in redevelopment projects due to the inevitable problems of unexpected additional work, excessive requirements and scope management issues, project funding not aligned with project plans, delay, structural failure, cost overrun, etc. (Naaranoja & Uden, 2007).

These problems or uncertainties, among others, increase the project risk and make their management crucial if success is desired. Several projects in the housing and road sub-sectors across Nigeria have witnessed huge investment of public and private funds without commensurate result expended. This huge expenditure and apparent failure in the primary objectives of the project led to complaints, probe panels and subsequent abandonment of the project. According to Obi (2014), the rate at which project delays, failures, cost overruns and abandonment are experienced on many projects handled by indigenous building contractors and clients in Imo State Nigeria is quite alarming.

A successful project is a project that has been completed on schedule, within budget, scope and satisfied the required quality (Allan 1991, 2004; Hatush & Skitmore 1997; Doloi 2007). Projects that do not deliver the required value they promise and of course do not realize their original objectives are all failed projects, in other words for a project to fail one or all of these component time, cost and quality have failed (Frank 2011).


1.3 Research Questions

  1. What are the contract planning practices applied in the construction industry?
  2. What is the level of awareness and usage of contract planning practices in the construction industry?
  3. What are the factors affecting contract planning practices on construction projects?
  4. What are the effects of contract planning practices to construction projects performance?

1.4 Aim and Objectives of the Study

The aim of the study is to investigate the effects of contract planning on construction project performance, and the objectives are:

  1. To determine contract planning practices applied in the construction industry.
  2. To assess awareness and usage of contract planning practices in the construction industry.
  3. To examine the factors affecting contract planning practices
  4. To evaluate the effect of contract planning practices to construction project performance.

1.5 Significance of the study

The study sought to examine contract planning and project performance of the road construction projects in Nigeria, specifically in Imo State. This study gave insights to understanding the importance of contract planning in the construction industry. It may also have some contribution to the formulation of appropriate policies relating to the performance of road construction projects.

These policies will help the concerned bodies dealing in road construction such as Nigeria National Roads Authority, Ministry of Works and Transport, Local Government road construction committees at the district, and private organizations such as CAIIP to focus on the root causes of incomplete road projects than giving attention to the observed problems.

In addition to this, the policies may facilitate further studies on the problem since there is little relevant and comprehensive data on the study in Nigeria. The information obtained during the study will ultimately build on the existing body of knowledge to pave way for further research in the field of contract planning and performance in academia.


1.6 Scope of the study

The study was carried out on the effect of contract planning on construction project performance. This study was carried out on road constructions in Imo state.


1.7 Justification of the study

While a lot of attention has been directed toward implementation procedures in acquisition of goods and services in public organizations, little has been done to establish the best practices in compliance to contract regulations in Nigeria. This study generated information relating to contract planning and performance of road projects, specifically in Imo State. It was intended that the findings of this research will be useful source of information to Imo State in strengthening the acquisition, implementation and integration of contract monitoring practices in administration. The study may also influence government policies with regard to contracts and also form a basis on which academic researchers can do further studies in monitoring and evaluation.


1.8 Operational definitions

Contract planning:

In the Wikipedia Encyclopedia of 28 September 2015, contract planning is the management of either common commercial or complex contracts made with customers, vendors, partners or employees. It is a process of systematically and efficiently managing contract creation, execution and analysis for the purpose of maximizing financial and operational performance and minimizing risk. It was found that 42% of enterprises the top driver for improvements in the management of contracts is the pressure to better assess and mitigate risks and nearly 65%of enterprises report that contract life cycle management has improved exposure to financial and legal risks.

Monitoring intensity:

This is measurable concentration of regular observation and recording of activities taking place in a project.

Risk management:

Hubbard (2009) defined risk management as the identification, assessment, and prioritization of risk followed by coordinated and economic application of resources to minimize, monitor, and control the probability and/ or impact of unfortunate events. This definition was adopted for the study.

Evaluation:

According to Farlex Partner, 2012, evaluation is a systematic, objective assessment of relevance, effectiveness and impact of activities in the light of specified objectives. Indeed, it is an assessment, judgment of the worthiness or value of a project, policy, intervention, state of affairs, self.

Project Performance:

This is an ongoing review of the efficiency and importance of a given project. It is used as a means of understanding and improving company, department and personnel performance.

Stakeholders:

Those persons and entities that have an interest in the strategy of an entity. Stakeholders normally include shareholders, customers, staff and the local community.

Strategy:

This is the determination of the basic goals and objectives of a firm and the adoption of courses of action including the allocation of resources necessary for carrying out these goals. Structure: the means by which the organization seeks to achieve its strategic objective and implement strategies and strategic change.


1.9 Organization of Study

The study is divided into five chapters.

Chapter one deals with the study’s introduction and gives a background to the study. Chapter two reviews related and relevant literature.

The chapter three gives the research methodology while the chapter four gives the study’s analysis and interpretation of data.

The study concludes with chapter five which deals on the summary, conclusion and recommendation.


Chapter Five


Discussion Of The Findings, Conclusions And Recommendations

5.1 Introduction

This chapter presents the findings, conclusions, and recommendations of the study. The discussion follows study objectives which were: to examine the role of monitoring intensity in enhancing performance of the road construction projects in Imo State; to analyze the relationship between risk management and performance of the road construction projects in Imo State; to assess the role of evaluation in enhancing performance of the road construction projects in Imo State.


5.2 Discussion of the findings

5.2.1 Monitoring Intensity and performance

Monitoring intensity has been one of the most commonly known measures to enhance performance, more especially in an environment that involves a master (the government) and the agent (the contractor). The master normally has objectives and must ensure the agent’s work finally meets his expectations. However, the agent too has objectives which he can achieve by exploiting the weaknesses of the master and among the weaknesses is failure to monitor the projects which give chance to the contractors to do substandard work or fail to complete projects within the budgeted time frame, resulting into cost overruns as was the case for the unsuccessful road construction projects in Imo State. This concurs with Ngosong (2015) who indicated that lack of quality in the construction is manifested in poor or non-sustainable workmanship and unsafe structures; and in delays, cost overruns and disputes in construction contracts.

According to the district engineer, monitoring helps to ensure compliance to the guideline and set standards for road construction, ensure value for money through economy, efficiency, and effectiveness. He further indicated that monitoring intensity is the objective of the project. However, despite all those benefits out of monitoring intensity, he cited the non availability of funds to facilitate regular monitoring of all projects in the district on the part of the contractors and the district local government.

In the interview with the Engineer Nansana Town Council, it was indicated that monitoring intensity helps to establish the status of the project, it provides checks and balances of whether the intended objectives were achieved, and relevance of the projects to the surrounding communities.

Findings indicated that though the generally successful projects complied with the service quality level which had been specified in the bidding document, the unsuccessful road construction projects were found not to comply with the service quality level as per the bidding document. This concurs partly with the findings by the World Bank report, 2004 which indicated that in order to be entitled to the monthly payment for maintenance services, the contractors must ensure that the roads under contract comply with the service quality levels which have been specified in the bidding document. It is possible that during some months they will have to carry out a rather large amount of physical works in order to comply with the required service levels and very little work during other months. Yet their monthly payment remains the same as long as the required service levels are complied with. Findings indicated that for the unsuccessful road construction projects, though no visible work was done, payments had already been made to such projects which caused the district to lose a lot of funds to such projects.

Findings indicated that the district had a proper maintenance plan in place indicating the type of roads to be constructed, their related costs and the nature of funding. These plans were drawn by the district engineer in consultation with the district construction committee. According to the district engineer planning helps the district to solicit for funds from the central government and monitoring the progress in the district by relating what was planned with the actual achievement over a given period of time.

Findings indicated that monitoring intensity helped to ensure that funds were utilized for the fulfillment of project objectives. However, the projects experienced delays in the disbursement of funds. This was further confirmed by the district engineer who indicated that the funds were not always available which make contractors to charge high rates for road construction because they delayed being paid by their client.

Further, findings indicated that the contractors complied with the service quality levels as specified in the bidding documents. However, the standards set for the contractors from their clients were found to be low for example the road size, the amount of materials such as gravel to be used were low since high specification level would mean high related costs to the clients which funds would not be solicited to facilitate road construction of high standards. In this case the specifications are low which were always met by contractors but it affected negatively the quality of the roads in terms of size and longevity. The quality of the road had to depend on the expected level of funding.

In the generally successful projects, funds were utilized for the fulfillment of project objectives and the contractors complied with the service quality levels which were specified in the bidding documents. However, the officer in charge of road projects monitoring in Imo State indicated that there were challenges of meager resources which led to cheaper methods and materials being used for example instead of using asphalt, bitumen was used for surfacing.
On average, the findings indicated that there was monthly inspection in the generally successful road construction projects and the managers carried out the necessary road inspection which aspect was lacking in the unsuccessful road construction projects.

This contrasted with Queiroz (2005), five steps that can be followed to ensure the quality in monitoring intensity such as:

  1. Contractor’s self-control system;
  2. Formal monthly inspections;
  3. Supervisors (formal/informal) inspections;
  4. Project managers (formal/informal) inspections; and
  5. Maintaining a record book to follow the comments or complaints of roads users.

This approach is able to ensure the quality of maintenance work. However, the district was found not to maintain any record book to follow the comments or complaints of the user. In the long run the expectations of various stakeholders could not be met and iron out the weakness before the final completion of the road construction projects.

However, in the generally successful projects the contractors were found not to use the stipulated amount of material while constructing roads as per bills of quantities (BOQs), the contractors did not do the required amount of work during the month which was basically attributed to shortage of funds provided by the district and they did not have a well maintained record book to follow the complaints of the road users. This would help two identify the problems early enough to find appropriate solutions before the conditions worsen for example some roads were too narrow and others caused drainage challenges to the residents which led to destruction of property.

Findings indicated that there was more diversion of funds in the unsuccessful project as compared to the generally successful projects. The poor performance in the generally successful road construction projects was basically attributed to the delayed disbursement of funds to the road construction projects. According to the officer in charge of monitoring the road projects in Imo State, she indicated that road maintenance plans were executed basing on the availability of funds.

Findings indicated that monitoring intensity for the generally successful projects in Imo State was highly related to the district’s ability to have a proper road operation and having a maintenance plan in place, followed by the contractor’s ability to comply with the service quality level which is specified in the bidding document, and the ability by the project managers to carry out the necessary road inspection to meet the required standards. However, for the unsuccessful projects, more correlation was realized in the utilization of funds to fulfill project objectives, followed by the ability by project managers to carry out the necessary road inspection, and the ability of the road authorities to carry out the monthly inspections. This concurs with the findings from the district engineer who indicated that the district lacked sufficient manpower to efficiently supervise all the respective road construction projects.

Findings indicated that there was a higher positive significant relationship between monitoring intensity and performance in both the unsuccessful projects and the generally successful road construction projects in Imo State. In conclusion, monitoring intensity plays a very significant role to the performance of both the generally successful and the unsuccessful road construction projects in Imo State.

5.2.2 Risk Management and Performance

According to Hannington and Hiehaus (2015), the term risk has a variety of meaning in business and everyday life. In most cases, risk refers to any situation where there is uncertainty about what outcome will occur. In financial management and investment management, risk is often used in a more specific sense to indicate possible variability in income around some expected value. Risk further, analyses the expected value as the outcome that would occur on average if a person or business were repeatedly exposed to the same type of risk. Risk management involves the tools used to guard against the possibility of a loss.

The study examined the tools being used in both the generally successful and the unsuccessful road projects in Imo State and their effect on performance which include: identification of risks involved in the road construction projects by contractors, taking time to analyze the risks relating to projects in road construction, timely response to the risks to achieve project objectives, harmonizing participant’s expectations and interests, shifting the risks involved to the contractors, interpretation of contract language for road construction projects, understanding the design and construction complexity, regular supply of the required manpower, regular supply of construction materials and equipments to the road construction projects.

Findings from the respondent indicated that both the successful and the unsuccessful road construction projects could interpret the contract language. In this case the terms and conditions under which the district and the contractors were supposed to work were very clear on both sides. These included the mode of delivery and the penalty in case of non compliance to the terms in the contract. This would finally help to ensure value for money, completion of projects within the stipulated time and to avoid cost overruns. The findings concurs with Hyman, 2009,

Austroads, 2003; Hardy 2001 who indicated in their studies that risk management results in better outcomes at lower cost with less risk and more financial predictability for highway agencies. Austroads (2003) and Hardy (2001) further indicated that risk allocation to the contractors would be beneficial for the road authorities only when contractors are better to manage the risk and the contractors must be able to properly understand risk management to successfully interpret contract language and share the risk.

According to the district engineer, normally the contractors would expedite the work and hand over quickly for example the CAIIP roads where the contractors would avoid incurring added costs. Secondly, the contractors would use phased stage handing over which would help to reduce delays and at the same time minimizing the related costs. However, some contract terms like front loading at bid pricing would increase the risks to the district. In this case the contractors would be paid a given percentage say 60 to 70 percent of the sum of the contract cost at the beginning. Finding indicated that even if the contractors abandoned work, there was no way to recover the money paid to the contractors. According to the district engineer, this could be as a result of fake insurance bonds or security bonds.

Further findings indicated that the participants on the road projects which include the contractors, community, government officials always had different expeditions and interests. This very issue was evident in both the generally successful and the unsuccessful projects. With diverging interests there was a higher possibility of fund diversion and the funds would not be fully utilized to specifically meet the goals of the projects more especially the non successful projects since those who would ensure that resources were put to the right usage could have the authority but not the strength to ask the contractors to fully account for resources. The findings concurs with Banaitiene and Banaitis (2012) who indicated that construction projects are exposed to uncertain environment because of such factors as planning, design and construction complexity, presence of various interest groups (owner, consultants, contractors, suppliers etc), resources (manpower, materials, equipment, and funds) availability, environmental factors, the economic and political environment.

The findings indicated that the contractors would again identify the risks related to the road construction projects. In the generally successful projects at times the contractors would take time to analyze the risks relating to the road construction projects which was lacking in the unsuccessful road construction projects. According to the Monitoring officer at Imo State, the major risks include; the meager resources which lead to use of cheaper methods and materials for example using asphalt instead of bitumen for road surfacing, resistance by the citizens to widen the roads, difficult terrain such as swamps, weather changes where water washes away the surface, change of policies by the government in relation to road construction contracts such as the use of force account where the district provides equipment to be in the construction process which demoralizes the contractors, risks relating to the burning of bitumen which can catch fire, accidents on the road, high traffic and increase in maintenance cost as the market price for the major raw materials change.

Findings revealed that there was average response to the risks to achieve road project objectives and the risks involved could not be shifted to the contractors. The Nansana Town clerk indicated that the contractors would ask for higher prices to avert any risk associated with the increase in price because of the delayed payments from the central government. Further, the findings revealed that the contractors for the generally successful projects were rarely challenged with the design and construction complexity and they had the required manpower on the project. However, they lacked the risk management specialist that would help them to identify, analyze and control the risks related to the construction projects.

Findings from the study indicated that both the generally successful and the unsuccessful projects lacked equipments for road construction. These include; the water bousers, gravel stones and good quality murram. Some of the raw materials were transported from far areas which increased the construction costs and some were forced to use raw materials which would not meet the expected standards hence affected the quality of the roads negatively.

Findings from the interviews indicated that the contractors were challenged with change of policies by the government which increased the risk to the contractors for example the introduction of force account the district receives road equipment from the central government and uses local labor in form of road gangs. The long lists of the prequalified contactors were rendered redundant, secondly, the income projections were affected leading to losses, and indirect losses are experienced as their equipments were left redundant.

Findings show that there was a high correlation between the timely response to risk to achieve road project objectives with the regularity in supply of the construction materials and the availability of the required manpower on the road construction projects. Findings further show that time taken to analyze the risks was related to the interpretation of the contract language and the different expectations and interests by participants on the road construction projects. When the participants basically the client has different personal interest in the road construction project, then he/she will not be bothered by the quality of work of work done by the contractors and since the contractors will not be accountable for their actions, then they do not waste their time in managing risks.
Findings show that there was a very high positive relationship between risk management and performance in both the generally successful and the unsuccessful road construction projects. In this case, the null hypothesis can be rejected since there is a significant relationship between risk management and performance.

5.2.3 Evaluation and Performance

Evaluation is a quality assurance management tool which is used to check on the level of success, the problems that are faced, the efficiency in the use of resources, the ability of the project to meet the expectations of the shareholders, and the way forward to ensure high quality service delivery. It is recommended that project evaluation should be a regular ongoing exercise which should be carried out at all project stages. According to DAAD (2010), a critical self – evaluation is important because we are at times too eager to accept that everything is good which concurs with the road projects in Imo State. In many cases a self – evaluation serves as a preparation for site visits by external experts. However, site visits by external evaluation experts were lacking in Imo State road construction projects. The self- evaluation report provides the external experts with basic information. It provides an opportunity for discovering quality, and it provides information not known to everyone. This contrasts with the findings at the district where project related information was not fully disclosed to all the stakeholders.

The information exists but only a small group of people knows it, it shows which consideration choices need to be made, and the information gathered is brought to bear on base line information. Evaluation answers the following questions: why do we do what we are doing?, do we indeed do the right thing?, do we do the right thing in the right way?, do we have a thorough command of the process to actually realize what we want?, do we actually achieve what we want?. The researcher based on the above questions to assess how evaluation affects the performance of the road construction projects in Imo State.

Findings in relation to evaluation of the road construction projects indicated that the district had proper documentation in relation to the construction projects. Information was available in relation to all ongoing projects and their status which included those that were completed and ongoing. However, information relating to the level of success could not be accessed at the district. This information could not used by the district to take the future course of action in relation to the road construction projects. The findings concurs with Oluka and Basheka (2015), who indicated that lack of access to information, limited stakeholder involvement/participation, and lack of political will to monitor contracts were among the major constraints in contract planning.

According to the engineer Nansana Municipal Council, the district had a five year plan. In either the annual work plans or quarterly work plans, the operation and maintenance was catered for as the operation and maintenance plans were partly implemented. The district would base on the work plan to evaluate whether the set targets were achieve and establish the variance between what was planned and the actual achievements. This would check on the timely completion of the projects and value for money by checking on the quality of the roads as per the plans.
Findings further indicated that the road construction projects were affected by weather changes more especially too much rains. This did not only account for delays but also loss of materials since the rain could wash away some materials such as soil and the stones being used. During the dry season, the cost of watering the road increased as residents got fed-up of the dusty environment where some would reach an extent of staging strikes in resistance of the prevailing dusty conditions which would put the employees and their construction materials such as tracks at a greater risk of being destroyed. To avoid such incidences, water bousers had to be used on the daily basis which was always at high cost on the part of the constructors.

Further, the findings in relation to the generally successful road construction projects indicated that they gave voice to participant’s experiences. The different stakeholders basically the community would air out their view through organized meetings. According to the cocoordinator for CAIIP roads, on every road the engineer convened meetings. However, there was always low turn-up and yet people were found not to be knowledgeable enough in relation to the content involved in the contracts they were given to sign. In conclusion though there was an open forum for the participants to share their views as provided by the district, the low turn- up for the meetings hindered the full exploitation of this opportunity. There was increased sensitization of the masses and co-funding was carried out where the community would buy the culverts to their premises. This helped to reduce the costs on the road construction materials and increased responsibility by the community to ensure that the roads construction process would proceed as planned without delays. However, the unsuccessful road construction projects were found not to give participant’s experience to the community other than the district. The community could know little about the contractor’s activities

Findings in relation to the unsuccessful projects, it was indicated that there was appropriate documentation by the contractors and the contractors were in position to identify the problems plus there possible causes. However, despite the fact that they knew the problems, they could not come up with measures to address those challenges before they could worsen to unmanageable situations that resulted into great losses especially on the side of their client that is Imo State. This concurs with DAAD (2010) which indicated that information concentrate in just a small group of individuals and once no effort is taken by the entity to find it, then the problems persist which affects negatively the performance of the entity.

Findings further indicated that the unsuccessful projects could not make timely decisions about the future of the construction projects, rarely were the objectives adjusted where there were gaps, and the contractors could not brainstorm on the factors that may affect the construction projects. Brainstorming helps to identify the project problems, examine the level of success and come up with solutions in the timely manner.

Findings further indicated that performance in the generally successful road construction projects was more related with the contractor’s ability to identify the problems, the political influence in the construction projects, and the availability of funds to execute the duties of the road projects. For the unsuccessful road construction projects, performance was found to be highly correlated with the availability of funds to execute the duties of the projects, appropriate documentation by the contractors, the ability by the contractors to carry out assessment in relation to the goals and objectives as stipulated in the initial contract agreement, timely decision about the future of the construction projects and the ability to get information to enhance the quality of the road construction projects.
The study found out that the road construction projects lacked evaluation programs at all stages. This was attributed to the limited funding to facilitate the exercise and it was not clear who would be the final beneficiary and who would finance the evaluation process between the contractors and the district. However, there was a high positive significant relationship between evaluation and performance of the road construction projects in Imo State in both the generally successful projects. For this reason the null hypothesis can be rejected that there is no significant relationship between evaluation and performance of the road construction projects in Imo State.


5.3 Conclusions

5.3.1 Monitoring intensity and Performance

If monitoring intensity is not taken seriously in the road construction projects, this contradict with the guidelines and set standards for road construction projects resulting into poor performance.
Monitoring intensity in the road construction projects is positively related to performance.

5.3.2 Risk Management and performance

Performance in the road construction projects is enhanced when risk management is carried out at all stages. The measures to control risk by contractors such as expediting the work and hand over quickly and use front loading at bid pricing where contractors are paid 60 to 70 percent of the contract value at the beginning enables contractor to shift risk to the district.

Inadequate and untimely funding can result into project delays, high cost of the road construction shoddy works.
Risk management is related to the availability of resources in the road construction projects. These include the human resources, and the physical resources such as raw materials, tractors, water bousers. The risk tend to be low when the resources are in abundance and the risk tend to be high when there is shortage in supply of the resources which results into poor performance in form of delays, cost overruns and construction of substandard roads.

5.3.3 Evaluation and Performance

Failure to carry out evaluation was in the road construction projects hinders timely response to the problems which negatively affect the quality of work in the road construction projects. This leads to poor accountability, lack of transparency, lack of value for money, and finally it creates a pool of dissatisfied stakeholders.

Road inspection by the district authorities plays a very significant positive role to enhance performance in any project be it public or private.

Evaluation, monitoring intensity, and risk management are equally important to enhance performance in the construction projects.


5.4 Recommendations

5.4.1 Monitoring intensity and performance

There is need to increase on the number of road inspectors. The government should recruit more inspectors at Imo State to ensure value for money and timely completion of the road construction projects. There were few inspectors with the technical competence to effectively, monitor, manage the risk, and at the same time carry out the evaluation since the few that were already at the district were already on full caseload. Given, the insufficient funds at the district, the added cost of hiring new inspectors on the road construction projects won’t be equated to the amount of loss incurred as a result of totally failing to effectively supervise the road construction projects.
Monitoring intensity should be increased in both the generally successful and the unsuccessful road construction projects.

5.4.2 Risk management and performance

The district must first ensure that there is enough resources basically the finances and the human resources before they can embark on any project to avoid frustrations on the side of the contractors which finally lead to poor performance as the real costs tend to be high in the long run.

The district must reduce political influence in the road construction projects since it reduces the command of the process

5.4.3 Evaluation and Performance

Evaluation must be carried by the district to ensure value for money. Both internal and evaluation should be carried out to establish whether the projects achieved the intended goals and objectives. However, evaluation requires technical internal and external experts to influence any decision making in relation to the goals and objectives, it requires a lot of funds to facilitate the exercise which could currently be lacking at the district. There is therefore a need to include the evaluation costs on the budget while planning for the road construction projects.


The Effect Of Contract Planning On Construction Project Performance


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