Analysis of BIM and Cost Overruns in Construction

The assignment requires students to analyze the relationship between Building Information Modelling (BIM) and cost overruns in construction projects. Students are expected to review relevant literature, case studies, and research findings to identify the causes of cost overruns and explore how BIM can be used to mitigate these issues. The assignment also includes a comparative case study analysis of different countries, including Australia, Malaysia, and Ghana. Students are required to provide a detailed report on their findings and recommendations for improving productivity in construction projects using BIM.

BIM impact on the cost overruns in infrastructure projects in Australia
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1. Introduction
The limitations of the existing traditional approaches to managing present complex construction
projects have resulted in a low performance in many aspects of the project management, especially when
it comes to cost and time which are key factors for the project success. Cost overruns possess a significant
risk to the construction industry and the magnitude of cost overrun has not been improved and learning
has not identified to mitigate this risk (Allahaim and Liu, n.d.). Studies suggested that contractors’
capability to estimate the cost and utilize tools for that purpose exhibits the cost-related performance of
projects in the construction industry (Doloi, 2012).
The construction industry since from last few years has been long criticised because of its poor
performance and inefficiency, as a resulted cost overruns is considered as a norm, Verweij (2015).
According to Shehu et al. (2014), the cost overruns in a construction project can lead to conflicts,
litigations and in severe cases abandoning of the project. Hence, the cost is considered as an important
factor in determining the success of projects especially related to infrastructure. The cost associated with
construction projects are categorised as direct and indirect cost that are both affected by cost overruns.
This could result in financial losses for contractors and/ clients and could possibly hinder economic
growth of the region. (Alabdulqader et al., 2013; Kraatz et al., 2014) claimed that, traditional management
is the major reason for cost overruns. These cost-related issues with the traditional management in the
construction industry include 60%–90% of variations due to poor documentation and 5%–10% of the
increase in construction cost due to lack of communication.
Building Information Modelling (BIM) has been rapidly emerging as a capable technology, forming an
integrated platform that can potentially improve the performance of the construction industry. BIM
represents a collaborative methodology to manage the project information throughout its lifecycle. The
distinctive idiosyncrasy of BIM is the ability to create, view and extract not only the geometric data of the
building but also non-geometric dates such as cost and time. For instance, the 5D (cost) BIM model
associated with 3D and 4D (Time) allows participants to review and analyses the project progress and
related cost. Building Information Management is a tool that can be used to estimate the cost associated
with projects at different stages to avoid cost overruns. BIM can provide cost estimations for the project
during different phases to overcome cost overruns.
With such benefits, this research project seeks to establish a comprehensive review of the literature and to
examine the current construction industry practices in relation to cost overruns in Australia and the
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potential impact of BIM technology to improve cost performance of construction projects. Particularly,
the research has the following sub-objectives:
1. To review the current state of BIM implementation in project management of infrastructure
projects within construction industry with a focus on the cost management process.
2. To explore the fundaments and key factors for cost overruns occurring in project management of
infrastructure projects within the construction industry.
3. To investigate the potential BIM contribution to improving cost performance.
1.1 Research design:
The research philosophy which is preferred for this research is positivism due to the objective
nature of the research. This research requires numeric data to identify the impact of BIM on infrastructure
projects in Australia; therefore, quantitative method of the research is considered by the scholar. BIM
implementation is affected by several participants at different levels of the project organisation. The
effect of BIM implementation is extending to a wide range of interrelated aspects. Therefore, electronic
survey questionnaires will be one of the most effective methodology to cover a large sample of
professional organisations in the construction industry. The survey questionnaires will be sent to the
employees of the firms involved in project management of infrastructure projects located in Australia.
The present research will contribute knowledge to the profession by reviewing BIM implementation
practices, challenges and benefits to cost performance. The result of this research will be valuable to the
construction industry participants, with a particular focus on the cost aspects of project management of
infrastructure projects along with the reflection on the construction industry performance.
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2. Literature review
This section presents an overview of BIM implementation and cost overruns through consideration of
ideas and identified shortfalls from previously published papers, articles, reports and books.
2.1. Cost overruns in construction projects in Australia
Cost overrun is defined as the excess of actual cost over budget. Such cost overruns can be daunting for
parties involved in construction projects and could lead to significant financial losses, penalties and
litigations. (Flyvbjerg, 2007) conducted a study in Denmark, to evaluate the accuracy of cost estimates on
large-scale infrastructure projects. The study concluded that overruns above 100% are usual and cost
overrun of 50– 100% is common for larger infrastructures. On average, the cost overruns around the
globe for infrastructure projects such as bridges, roads and rail are around 33.8 %, 20.4% and 44.7%
respectively (Flyvbjerg et al., 2005). The study conducted by Maher and McGoey-Smith (2006) cited by
Ramabodu and Verster, (2010), evaluated that cost overruns are independent of geographic location, 90%
of projects suffer underestimation of cost in the initial phase and the percentage-overrun increases with
the size of the project.
The performance of construction industry in Australia is based on cost and duration are pitiable. For
instances, the original contract value for the Western Australian Perth Arena was AU$168 million. The
actual cost at completion was three times more than this value. Further, it was completed three years after
the original planned completion date. Moreover, Ramabodu and Verster, (2010) and Terrill and Danks,
(2016) claimed that many large rail projects have experienced significant cost overruns such as Sydney
light rail, the Gold Coast light rail and Perth-Mandurah rail line. Deloitte Access Economics 2014
reported that Australian construction cost for infrastructure projects has increased rapidly due to Global
Financial Crisis (GFC), which resulted in a rise in engineering cost. This has resulted in an increase in
wage rate of the people involved in construction projects and there is no pullback in the wage system.
Moreover, in the last eight years from 2014, the cost overruns for the construction projects increased by
6.5% and the cost overruns are visible for larger projects. Although cost overruns are considered as a
significant risk to the construction industry, (Allahaim and Liu) claimed that yet the magnitude of cost
overruns has been improved.
According to the view of author building information modeling is becoming a comprehensive
collaborative process within the construction industry. Author argued that BIOM has had an enhancing
growth in the last decade. It happens because of its capabilities on construction projects. It can easily
develop a common language for all the parties and system divisions within a project and assist in making
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a integrated team. Author critically analyzed that approach of BIM strongly matches with integrated
project at the time of delivering system.
2.2. Factors influencing cost overruns in construction projects
It is an unquestionable fact that delays in almost all construction projects could occur due to miss-
communication among different parties involved in projects (Kaliba, Muya and Mumba, 2009). The
major reasons for such delays are the inaccurate estimation of the project cost and time that result in cost
overruns (Akintoye and Fitzgerald 2000). The role of project manager in such situation is extremely
important. They have the authority to manage the communication among different parties within
construction project from the beginning to end. Factors influencing cost overruns in the construction
industry were widely investigated by the researchers aiming to rank the most significant factors according
to their importance. Morris (1990) examined and identified four key causes of cost overruns: poor
planning, design changes, material prices fluctuation and unforeseen weather conditions. Shah (2016)
cited a study by Arditi (1985) about the main factors for delay and cost overruns in construction projects
in Turkey, as follows: inflation, design changes and underestimation of the original project cost. The
study conducted by Allahaim and Liu (n.d.) identified inadequate planning and control, market and
regularity uncertainty, site condition and scope change as the factors influencing cost overruns in KSA.
The factors influencing cost overruns in Ghana are payment delays, inaccuracy of projects’ cost
estimation and complexity of the project (Shah, 2016). According to Shah (2016), the main factors that
increase the probability of cost overruns in Australian projects are deficiencies in planning and
scheduling, construction methods, monitoring and feedback. The difference in factors influencing the cost
overruns in construction projects indicated that they are dependent on geographical locations and facilities
associated with these locations.
2.3 Cost overruns in infrastructure projects in Australia
The infrastructure projects deal with providing necessities to people in the form of physical construction
such as rails, roads, bridges and tunnels, sewage systems etc. These projects are generally long-term
projects and are associated with high cost. According to the findings of Maher and McGoey-Smith
(2006), the greater the size of the project, the larger would be the cost overrun. Therefore, it is anticipated
that infrastructure projects tend to have a high cost overrun.
Terril, Coates and Danks (2016) conducted a research in which Australian transport-related infrastructure
projects by the government were analysed for understanding cost overruns causes. For this purpose, the
transport related infrastructure projects from 2001 to 2015 were evaluated. The research concluded that
Australian transport infrastructure programs exceeded $20 million of the expected cost (Terril, Coates and
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Danks, 2016). Moreover, there was no evidence found for project appraisal process for such projects. This
also affects the future infrastructure projects by causing uncertainties in decision-making and managing
processes. According to Coultan (2016), the series of infrastructure projects in Australia are heavily
affecting the taxpayers as well as hinders future projects.
To evaluate the cost overruns for infrastructure projects in Australia; Creedy, Skitmore and Wong (2010)
studied highway projects in Australia. They were able to find a positive relationship between the size of
the project and overall cost overruns. It is identified that the highway projects in Australia suffer cost
overruns due to uncertain (uncontrollable) factors as compared to risk (controllable factors). The factors
that result in cost overruns in Australian highway projects are project type, construction material cost, the
location of the project and project’s delivery method.
Similarly, Doloi (2012) conducted a research to understand the cost overruns occur due to the failure of
project management in Australia industry. Reason for conducting this research is to identify the cause of
failure from the perspective of key stakeholders including consultant, client and contractor. Doloi claimed
that the project management plays an important role in the success of the project as they manage the
critical relationship between major stakeholders of the project. He also indentified the five significant
factors that could reduce the chances of cost overruns in Australian projects are top-notch project
planning and monitoring, effective site management, the efficiency of contractors, the efficiency of
design and communication.
2.4. Traditional practices to deal with cost overruns
With the complexity, uniqueness and fragmented nature of construction projects it have access to
coordinated and accurate information is pivotal for project management and performance. (Kraatz et al.,
2014) described the traditional 2D delivery model being used in infrastructure projects as “hierarchical,
fragmented, linear and prone to promoting adversarial behaviour across the supply chain”. (Yalcinkaya
and Arditi, 2013) argued that the two-dimensional delivery system is an insufficient method of
communication and falls short in monitoring complex projects. The poor collaboration amongst the team
and lack of integration of the design elements resulted in a lot of projects becoming behind schedule
and/or over budget.
Lack of adequate information has always contributed to poor productivity and rework, which in turn
result in cost overruns and delays (Matthews et al., 2015). The construction industry is still largely relying
on the 2D CAD-based application to generate the design and construction documents. This involves
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sharing of sheets among different parties involved in the project that are manually handled and results in
various inaccuracies and improper project management (Abbasnejad et al., 2016).
According to Young, Hosseini and Lædre (2016), the Australian infrastructure projects also utilise
traditional practices, which are resulting in high cost overrun in projects. It is believed that inaccuracies
and conflicts are also present in BIM models but the processing time is far less as compared to traditional
models (Smith, 2014). Engineers Australia identified the lack of integration along the supply chain
through the project life cycle as the most notable issue, promoting the need for BIM (Alabdulqader et al.,
2013).
2.5. BIM contribution to control cost overruns
Generally, BIM adoption has been referred as one of the most effective solutions for many of the
construction industry challenges. Succar, (2009) argued that the emerging BIM technology represents a
framework to manage the building information through the building lifecycle. BIM can be a catalyst for
industry transformation, reduce fragmentation, reduce cost and improve the efficiency.
(Love et al., 2017) acknowledged the potential reduction of cost overruns when BIM is applied to rail
projects. He stressed that achieving the real benefits of a BIM solution requires collaboration between all
parties, particularly when a building information model is utilized during Operations and Maintenance.
Kraatz et al., (2014) also claimed that adoption of BIM across the supply chain in Australia could enhance
the industry productivity by 9%.
However, (Shah, 2016) argued that BIM may not be sufficient to prevent entire cost overruns and delays.
He suggested that past experience and new methods could be used to mitigate recogonised risk factors,
particularly in the undeveloped and developing countries. In contrast (ALABDULQADER et al., 2013)
argued that the rate of BIM adoption appears to be lower than expected despite the far-reaching benefits
of BIM. (Bryde et al., 2013) also added that the overall effectiveness of BIM utilisation is still yet to be
completely justified.
Giel and Issa (2011) also researched BIM implementation impact on the construction industry through
return on investment (ROI). For this purpose, they conducted a comparative case study approach that
involves collecting information of three companies with similar nature of projects. The research
confirmed that BIM has a positive impact on the cost overruns and return on investments. The ROI of
implementing BIM on the three cases is in the range of 16 to 1,654%
2.5.1 Coordination and communication
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Many researchers believed that BIM improves communication and level of coordination among members
of project management team (Wong and Fan, 2013; Khosrowshahi and Arayici 2012; Coates et al. 2010).
The integrated model which furnish many benefits for the projects including improved productivity, clash
detection, resolve conflict and discrepancies early, and an effective method for tracking the changes. This
integrated approach for project information will result in time and cost saving during construction as 5%–
10% of the increase in construction cost due to lack of communication (ALABDULQADER et al., 2013);
(Rokooei, 2015). Based on face-to-face interviews with managers on construction projects focused on
RFI’s, rework, change orders and schedule compliance, (Fan et al., 2014) summarised that 79% of the
respondents stated there was “very little rework and waiting time” when BIM was used for coordination
of construction work on site. Respondents in the survey believed that they saved 4-7% of project cost,
because of the non-issuance of change orders.
Rowlinson et al. (2010) conducted a research by focusing on empirical evidence of the impact of BIM on
construction projects during the construction stage. The research highlighted the positive impact of BIM
implementation on eliminating the conflicts in design as compared to the traditional method. Moreover, it
alters the roles and responsibilities of the parties involved in such projects, which demand the change in
the culture of the construction-based organisation in which the technology alone cannot fulfil the need.
Building on this research, Dongping, Heng and Guangbin (2017) conducted another research in which
they utilised resource dependent theory for developing and testing a model that explains the impact of
BIM on the construction industry and cost overruns. For this purpose, the researchers deploy quantitative
research method and data were collected from the designers and contractors using survey questionnaire.
After extensive analysis of the data, they evaluated that BIM implementation improved communication
and collaborative decision-making.
2.5.2. Cost estimation, monitoring, and control
In very specific terms, Ali et al., (2010) claimed that inaccurate estimation of the original cost is the most
serious cause to cost overrun. He suggested that proper project costing is the most effective method to
control the construction projects cost. This includes cost estimates for the project resources and materials.
BIM can be used to generate a bill of quantities, and changes in the BIM model can be automatically
propagated through the whole estimation cycle (Yalcinkaya and Arditi, 2013; Diaz 2016). Azhar et al.,
(2008) studied the direct impact on the project cost of BIM implementation and concluded the accuracy in
cost estimation within 3%, the removal of unbudgeted change up to 40%, a decrease in project time up to
7% and a reduction in the time needed for cost estimating up to 80%.
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(Kamaruzzaman et al., 2016) emphasized the significant relationship between the accuracy of the
information as a result to BIM adoption and the reliability of the project cost estimate. He claimed that the
accuracy and reliable quantities generated by BIM model is its biggest advantage.
Lee, Park and Won (2012) investigated the ROI for BIM. It further analysed the cost of rework and the
cost of schedule delays. For this purpose, they utilised a secondary source of study based on the case
study of multiple BIM related projects found that BIM implementation in the early stage has a significant
impact on cost overruns. The cost overrun impact, due to schedule delay, is more significant than rework,
which demonstrates the major potential benefit of BIM implementation in the construction industry.
The report issued by McGraw Hill Construction (2014) discussed the value of BIM in Pacific Asia,
especially, in Australia and New Zealand. They collected the data from different firms in these
aforementioned localities. They argued that BIM implementation can assist in reducing the cost of the
projects up to 35%. Moreover, it was highlighted that these localities are undergoing projects worth $40
billion. By implantation of BIM, a massive amount of the project cost overruns can be reduced.
Additionally, 14% of the cost is saved when comparing the long-term benefits of BIM implantation. The
report also revealed that the lowest cost control is found in South Korea with 11% compared to 44% in
Germany. Furthermore, infrastructure projects can obtain maximum benefit of cost reduction as the cost
overruns can be reduced by 65% (McGraw Hill Construction, 2014).
2.5.3. Implementation of the cost dimension 5D
The innovation in this technology is not just the 3D visualisation of the building. The BIM technology has
developed further to add several other dimensions 4D, 5D, nD on top of the 3D visualisation model. The
4thD enables the project team to evaluate the buildability and workflow planning of a project and
communicate problems regarding to construction sequencing. The 5th D model integrates the cost data
and quantities. This enables the team to generate instance cost estimates and bill of quantities. It will also
help in exploring various design and construction scenarios in real time and calculate the value of the
change for cost management. (Smith, 2014). In addition to cost management through the project life cycle
from the design and tender stage to the facility management, (Popov et al., 2010) added other cost related
benefits in the implementation of a 5D BIM model such as cash flow prediction and management and the
ability to analyse the time and cost impacts while selecting material for the project.
Al-keim (2017) claimed that managers are responsible for cost overruns in the construction industry. He
conducted a research to identify strategies that could help project managers in reducing cost overruns
associated with such projects. The research concluded that the planning, process, design management,
procurement management, software usage, setting project cost and time define the clear scope of the
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projects as the key strategies. He further identified that BIM plays a convincing role in all of these
strategies. Its integration in planning, managing, designing and cost related strategies help the managers
in reducing cost overruns.
2.6 BIM implementation barriers
Despite the findings of potential benefits for the overall efficiency of construction projects and the huge
potential for increasing productivity, the adoption of BIM throughout the construction industry has been
observed as slower than expected (Walasek and Barszcz, 2017). Many barriers to BIM implementation
were reported by construction companies such as intellectual property rights, data ownership rights,
unclear responsibilities; and BIM and other software compatibilities. In Australia, the number of studies
focusing on the adoption and utilisation of BIM within the industry is still limited. Nonetheless, it can be
anticipated that Australian construction industry may be currently facing similar adoption issues
identified by past research studies conducted elsewhere (ALABDULQADER et al., 2013).
2.6.1 Contractual issues
Sharing information between different participants in the project through the BIM model has been noted
as an issue not easy to resolve. Due to intellectual property reasons, some designers will provide only
limited versions of the models to be used by contractors and quantity surveyors for information only. This
off course diminishes the main concept of a BIM model as an effective and efficient communication
platform. This vagueness over legal liability is also causing implications for firms providing insurance
services within the construction industry and may lead to insurance exclusions for BIM projects (Smith,
2014;Smith, 2016).
(Azhar, 2011) elaborated further on the contractual risks of information ownership and copyright. While
several parties are contributing into the BIM model, which party is responsible for updating the model
and which party would be responsible for any inaccuracy? and to what extent?
The legal issues associated with BIM adoption in Australia have been identified as a challenge to
overcome, including the need to develop contractual arrangements that complement BIM objectives and
outcomes (Kuiper and Holzer, 2013). In contrast, to date, little has been done to align the various
contractual procurement methods in Australia with the novel opportunities offered via BIM (Crawford
and Stephan, 2015).
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2.6.2 Software training, incompatibility and data management
One of the main reasons for the BIM model to fall short from its potential is the incomplete data. (Smith,
2016) argued that, although there are many resons for having incomplete data in the model, the main
reason is either the cost of fully developing a comprehensive model or lack of experience of the team to
input the necessary information. Having many companies providing limited investement in digital
technology, in addition to the continual evolving technology, many in the construction industry are
questioning the outcome benifits after commiting considerable time and money on training and software
development. This, in turn, has a direct impact on the quality of the BIM model, as the model requires
input of vast amount of information and interconnected data.
Bryde et al., (2013) disagreed that the BIM cost is an issue. Hence the price for BIM software is similar to
CAD software. Even some vendors offer BIM and CAD packages for price of a CAD package alone.
However, he agreed that the upfront cost can still be substantial for small firms.
(ALABDULQADER et al., 2013) analysed the various reasons for which companies did not adopted BIM
technology as follows: 37.5% because the existing CAD system is sufficient. 32.2% Due to the cost of
BIM modling and 23.8% BIM was not required in the projects.
Software compatibility and Standardisation is another issue that causes barrier to its implantation and
optimal usage in construction industry. (Smith, 2014; Kenley et al., 2016). However, these issues are
being mitigated trough projects such as ThinkProject, A360 and ConjectPM (Walasek and Barszcz, 2017)
(Walasek and Barszcz, 2017).
In Australia and New Zealand, a survey has been conducted by A2K Technologies (2014). The results
highlighted the significance of BIM workability and inter-department collaboration issues within the
construction industry. The survey also confirmed that only 22% of firms having successfully incorporated
BIM into their design and construction operations (Ghaffarianhoseini et al., 2017).
2.6.3 Leadership driver
The countries governments are widely cited as the key leader for the construction industry transformation
(CIBER 2012, AIA 2010). Although the government’s request for BIM implementation in public projects
is growing, the lack of client demand remains one of the key obstacles to the propagation of BIM
(Crawford and Stephan, 2015).
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As an example for the governments driving force, in 2010, the Singaporean government has initiated a
construction productivity road map. One of the strategies in this road map is to drive the adoption of BIM.
In 2011 a National Steering Committee was set up to provide a framework for BIM implementation.
Subsequently, the countries regulations have been modified to mandate a BIM format suBIMssion for
buildings works. As of July 2015, all suBIMssions for new buildings with gross floor area of 5000m2 or
above, are to be suBIMtted in BIM format (Teo et al., 2015). In Australia, the government have not
mandated the use of BIM on any of the countries public funded projects and the use of BIM is not
widespread, despite the intensifying adoption of BIM as a result of number of initiatives to inform
stakeholders about the potential gains of it use (CIBER 2012); (Smith, 2014).
2.7 Literature gap
From the literature review, it is clear that very little research about BIM and its impact on the cost in
construction industry are present. Specifically a large gap in literature and researches is present in
terms of the empirical evidence suggesting the impact of BIM on the cost of infrastructure projects in
Australia. This research aims to narrow down this gap by focusing on the empirical evidence of the
impact of BIM in the infrastructure projects. Researches performed on other localities of the world will be
utilised as basis to this research.
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3. Research methodology
In the previous chapter, the theoretical background of BIM contribution to the cost performance in
infrastructure projects was reviewed through the available literature and the following hypotheses were
identified for testing:
H1: BIM is not being efficiently utilized in the cost estimate process.
H2: BIM can improve the cost performance of the infrastructure projects.
This chapter outlines different methods which are adopted by the scholar for the present research. This
chapter will provide the detail information related to the research approach adopted in this investigation
in order to achieve the research aims, objectives and enable the validity of the research hypotheses.
Further, this chapter defines data collection process, instrument and analysis. Reason for selecting this
method is that it will provide opportunity to integrate the qualitative and quantitative methods of data
collection.
3.1 Research method
Research method deals with the method through which data will be gathered by the researcher to draw a
valid conclusion from the investigation. (Easterby-Smith et al., 2012; Fellows and Liu, 2005) defined
research methodology as: “The principles and procedures or logical thought processes which could be
applied to scientific investigations”.
Two types of research method are a qualitative and quantitative method of research.
3.1.1 Qualitative research method
The qualitative research is grounded on interpretivist paradigm concerned with understanding the
meaning of social phenomena and focus on the links among a large number of attributes across few cases
(Tuli, 2011). The qualitative is subjective and emphasis experience and meanings. It is intended for use to
understand the perception of phenomena and explain experience (Naoum, 2012). This research method
deals with gathering data in the form of facts opinion and beliefs that are based on text and need a
technique like thematic and content analysis to interpret data into meaningful information. The qualitative
research method is supported by interpretivism Philosophy. The interpretivism took advantage of
language, meanings and values in its benefits to conduct research. The inductive research approach is
relevant to the qualitative study as it helps in converting the beliefs and opinions into concepts and
theories.
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Research design: It is known as one of the method through which findings can be presented in a
systematic manner. there are three different types of research design that are descriptive, exploratory and
explanatory. For the present research descriptive research design will be considered by the scholar. In
this, research scholar will be able describe the population which is covered in the study.
3.1.2 Quantitative research method
On the other hand, quantitative research is grounded on the positivist paradigm and seek to quantify the
social phenomena through collection and analysis of numerical data (Tuli, 2011). The quantitative method
is an inquiry into a human or social problem and objective in nature. It is intended for use to find facts
about the question and to test a particular hypothesis (Naoum, 2012). This research method is based on
collecting data in the form of numbers that can be analysed with the help of statistical tools to convert into
meaningful information. This kind of data can be extracted through survey questionnaires. The
quantitative method is supported by positivism philosophy. Positivism argues that scientific knowledge
and experimentation are the only possible explanation for a different solution while realism deals with the
reality being independent of conceptual schemes (visuals). The suitable research approach for quantitative
research method is a deductive approach that involves the use of already established literature to validate
statements.
3.1.3 Research methodology adopted
Due to the objective nature of the research, the quantitative research method is adopted for this research.
The main aim of this research is to study the impact of BIM on the cost overruns for Infrastructure
projects in Australia. The hypothesis is developed due to objective nature of research and will be tested
based on facts and figure that is only possible through quantitative research method. Moreover, the
findings can be generalised and compared easily with other studies through quantitative method.
3.2 Data collection, sample and research instruments
The research nature, type and availability of information define the data collection approach to be adopted
for conducting the research. Mainly, there are two approaches to data collection (Naoum, 2007):
1. Fieldwork (primary data collection as the data are obtained first hand).
2. Desk study (secondary data collection as the data are obtained from other sources).
For this research, both primary and secondary data source will be utilised.
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Since there are numerous parties involved in infrastructural construction projects; a large sample size is
required. Therefore, for this research, a sample size of 90 is decided that will be selected randomly
however located in Australia.
The research instruments are the tools that researchers used in their study to collect and analyse data.
There is a different kind of research instruments that include survey questionnaires, interviews (structured
and unstructured) and focus groups.
Several participants at different levels of the project organization influence BIM implementation and the
effect of BIM implementation extends to a wide range of interrelated aspects. Surveys are a very popular
form of data collection, especially when gathering information from the large sample, where
standardization is also important. Since the sample size is large and quantitative nature of data is required
survey questionnaires are chosen for this research as a research instrument.
Sampling: It is not easy for the scholar to conduct the research from large number of population.
Therefore, sampling method is required to be adopted at the time of collecting primary information. There
are two different types of sampling method: probabilistic and non-probabilistic. Furthermore,
probabilistic method is also known as random sampling method. It is the type of sampling in which
scholar select randomly. Reason for selecting random sampling method is that it leads to provide equal
chance to employees of being selected. Along with this it reduces the chances of bias.
Quantitative analysis tools
Different types of quantitative analysis tools are known as thematic, SPSS etc. For the present research
thematic analysis is considered by the scholar for analysis purpose. In this various themes are prepared by
the scholar on the basis of results. Along with this, different charts and tables are prepared that will help
in presenting the findings in more appropriate manner.
3.2.1 Questionnaire design and validation
An electronic questionnaire survey was considered the most appropriate technique in order to collect the
data used to test the research hypotheses. The questions is designed considering the previous literature.
The prepared questionnaire will be tested by distributing the survey questionnaire to the 5% of the
selected sample size (5) to identify mistakes and assess its relevancy.
The questions are split into three distinct sections in line with the research hypotheses. The first section
will be about the respondents, their company and their experience, to ensure the criterion for inclusion in
the study had been met and to allow for the appropriate categorization of the data. The second is intended
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to gather data in relation to the current status of BIM utilization in construction industry in Australia. The
third section related to the respondent’s perceptions of BIM to potentially contribute to cost performance
Improvement. Questions will be concise, clear and in a logical sequence. The majority of the questions
are closed, to allow for the quantitative analysis of results, however, few questions are open where it was
identified that greater insight might be required. The answers to the questions will be based on a five-
point Likert scale.
Quantitative analysis tool
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4. Results and data analysis
4.1 Introduction
It is one of another considerable part of the thesis after deciding the eminent way of
gathering information on the selected topic. This is the unit in which necessitate the researcher to
make a important evaluation of the collected set of information in a thematic manner. It is
basically in support of its quantitative data analysis method that has subsequently leaded to
substantiate the concentrated statistics from the targeted set of responders. It is also referred to
be an essential part of the dissertation where it helps in approaching to a decisive conclusion to
achieve the laid down aims and objectives of this research work.
The present research is in regard to gain knowledge related to such contradictory factors of
working capital which lead to develop understanding BIM impact on cost overruns in
infrastructure projects in Australia. here both primary as well secondary method is considered by
the scholar. However, this is the part which especially in relation to predict the primary resultants
of gathered information with a counted set of total 77respondents who worked in the
constructions Companies All the themes were constructed through referring to the findings
gathered from the participants respondents.
4.2. Thematic analysis
It is known as the collaborative subdivision of this unit which has to be depicted the framed set
of questionnaires in a thematic format. Here below provided is the fundamental analysis of the
information gain from the participants of the study.
Theme 1: Contract is the best described the company/organization type
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Interpretation and analysis: According to the collected information it has been found that out
of 77 respondents, 40 said that contractor can be described their company type, while 33 replied
designer and rest 4 stated consultant government authority etc. Hence, it is analyzed that
different employees work on different position due to which they segregate in different types.
Theme 2: More than 60 employees are employed by the company/organization
Interpretation and analysis: It is where questions asked from the respondents related to the
construction company hired number of who are working in participants companies, out of 77
respondents, 74 states more than 60 while 2 replied less than 20 and 1 stated 40 to 60 workers are
hired within the constructions companies. Hence it is analyses that in most of the construction
companies employees are employed more than 60.
Theme 3: More that 10 years have you been working in the construction industry
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Interpretation and analysis: It is on interpreting the above acquired reactions given by the
study participants in survey, it has been discovered that larger part of respondents is working
within the construction industry from more that 10 years. People who are working from 10 years
posses good position within the company and they also have huge experience related to work
which help in making in working on projects. On the other side 7 respondents were working
from 6 to 10 years and 7 from 3 to 5 years. However, remaining 5 working since from last two
years. Hence it is analyzed that all the employees are working from more that 2 years which
clearly indicate that they hold good experienced in their respective field.
Theme 4: Manager described best role in the company/organization
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Interpretation and analysis: From the above collected information it is interpreted that out 77
employees 26 said Manager described best role in the company/organization. Moreover, 25
replied senior staff and 14 said senior manager’ director. However, remaining 12 said junior
staff. Hence, it is analyses that employees are working on different position within the
construction companies. But most of the participants are at manager and at the senior staff
position.
Theme 5: Most of the employees are between the age of 36-45
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Interpretation and analysis: when questions asked from personnel related to their age group of
77 respondents 32 were in between the age of 36-45, 27 in 25-35. Further 8 among them are
above the age of 55. However, remaining 3 falls below the age of 25.
Theme 6: infrastructure projects including roads, nails and utilities type of project most
often to work on.
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Interpretation and analysis: according to the collected information it is interpreted that out of
77 respondents, 73 said infrastructure projects including roads, nails and utilities are most often
your worked on. However, remaining 4 said that residential or commercial building projects are
the type of project which are considered by the firm. Hence, it is analysed that there are different
types of construction companies who worked on different types of project. However,
infrastructure project is undertaken by most of the construction companies.
Theme 7: Cost overruns, as a percent of total project cost, increases as the project size
increase
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Interpretation and analysis: according to the collected information it is interpreted that out of
77 respondents, 75 answered and 2 skipped them. 44 participants highly agreed, 10 only agreed
cost overruns lead to posies significant risk to the company and magnitude of the cost overrun
cannot be improved. They think project mostly lead to suffer from the underestimations of cost
in the initial phase and the percentage overrun lead to enhance with the size. On the other side,
21 among them disagreed with the given statement. Hence it is analysed that cost overruns can
be daunting for parties involved in construction projects and could lead to significant financial
losses, penalties and litigations. Further, the findings of the literature review also shed the light
on cost overruns are dependent on size of the project, 90% of projects suffer underestimation of
cost in the initial phase and the percentage-overrun increases with the size of the project. This
shows the consistency between primary and secondary research.
Theme 8: There are different causes of cost overruns in infrastructure project which are
important
Interpretation and analysis: At the time when questions asked related to the causes of cost
overruns in infrastructure project respondents has provided different views and opinion on it.
Most of the respondents stated low labor productivity, inflations in the cost of labors, is not more
important causes of cist overruns. On the other side, there are most of the respondents who state
that indicate that Inaccurate cost and time estimates of project, Poor planning and scheduling,
Lack of coordination between project parties, Lack of collaboration between project
stakeholders, Deficient design and delays in design process are the important causes of cost
overruns in infrastructure project. Hence it is analyzed that there are various causes of cost
overruns which need to be improved for both company as well as client. Cost overruns possess a
significant risk to the construction industry and the magnitude of cost overrun has not been improved and
learning has not occurred to mitigate this risk. It also leads to increase the chances of the conflicts,
litigations and in serve cases abandoning. From the literature review findings, it is also identified that
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there are different factors which are influencing cost overruns in construction projects such as delay in
payments, inadequacies in arranging and booking, development techniques, checking and input.
Theme 9: Company/organization have any experience with using BIM
Interpretation and analysis: according to the collected information it is interpreted that out of
77 respondents 69 state yes: company/organization have experience related to the use of BIM.
On the other side, 4 said no their firm do not have any experience related to the use of BIM.
Hence it is analyses that there are many construction companies who are using BIM. They know
the effectiveness of using BIM such as it provides cost estimation for the project during different
phases to overcome cost overruns. Further, from the literature review chapter it is also reviews
that adoption of BIM is considered as one of the effective solutions for the construction industry
challenges. It shows the consistency between
Theme 10: Organization very likely use BIM in future
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Analysis and interpretation: According to the collected information it is interpreted that out of
77, 4 skipped the question and remaining provided their opinion. 55 said that organization will
use BIM in future, 16 also agreed with the same but remaining 2 do not think that their firm will
use BIM in future. In relation to the views of different employees it can be analyzed that most of
the people know about the BIM and its effectiveness. Along with this they understand the
significance of using BIM. Hence, construction companies should adopt BIM through which
their different issues related to cost overruns etc. can be avoided. Thus, collected information are
consistent with literature review which shows that skills.
Theme 11: The current BIM applications used on company/project is 3D modelling for
design.
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Analysis and interpretation: At the time when question was asked related to the kind of BIM
used in their company project respondents shows their different opinions. Most of the respondent
preferred BIM used was 3D modelling for design, clash detection/coordination of building
system and project visualising.
However, less preferred option was 4D modelling for schedule and planning of construction
activities and 5D modeling for material take-off or cost estimate. The 5D (cost) model is linked
with the 3D and 4D model. The implementation of 5D model provides benefit related to the cash
flow prediction and management and possess ability to analyses the time and cost impact at the
time of making selection of the material for the project.
Hence, it is analyzed that owing to 3D modelling for design helps in analyzing the project
progress with the help of projects at the various stages that help in avoiding the cost overruns.
Further it assists in providing estimated cost which is associated with the project. The collected
information is consistent with secondary data which shows that 3D model is effective that help
company in understand all the cost which are related to the project and they way that can be
overcome.
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Theme 12: BIM plays important role in the Future of project information Management
Analysis and interpretation: According to the collected information it is interpreted that out of 77, 4
skipped the question and remaining provided their opinion are as follows. 21 are highly agreed and 49
only agreed that BIM plays important role in the Future of project information Management. On the
other side 2 strongly disagreed and 1 only disagreed with the given statement. Participants knows
benefits of adoption of BIM as the way it brings accuracy in the project and improvement in the cost
which are analysed while carrying out research. Thus, collected detail are consistent with secondary
information and accordingly it becomes easy for researcher to extract valid outcome. Therefore,
secondary information reveals, few of the advantages of BIM include its ability to allow for the
accumulation of construction information through model data.
Theme 13: The construction industry is not clear enough of what BIM actually is
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Analysis and interpretation: When questions asked related to the construction industry is not clear
enough of what BIM actually is out of 77, 22 respondents were strongly agreed and 38 only agreed.
However, remaining 13, strongly disagreed with the given statement. There are many companies who
are not clear what the BIM is and its significance. Due to this reason, it comes in less used by
construction companies. Along with this, due to the lack of knowledge related to the BIM after adopting
companies were not able to make proper use of it.
Theme 14: Companies using BIM in their projects have a greater chance of winning work in the future
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Analysis and interpretation: According to the collected information it is interpreted that out of 77, 4 has
skipped the question and remaining provided their opinion. 26 are highly agreed and 36 only agreed
that Companies using BIM in their projects have a greater chance of winning work in the future. On the
other side 10 strongly disagree and 1 only disagree with the given statement. Role of BIM is to bring
together the data and different components to form a coherent set of information. One of the key
effective of implementation of BIM is to make sure that all parties working o the project must work on
common basis it leads to increase the chances of success of project in the future. On the other side,
from literature review it is identified that BIM in their project lead to have greater chances of winning
work in the future.
Theme 15: BIM can only be capitalized by large contractors who can support the implementation costs
Analysis and interpretation: From the above chart it is interpreted that out of 77 respondents, 34 highly
agreed and 13 only agreed that BIM can only be capitalized by large contractors who can support the
implementation costs. However, 25 only disagreed and 1 high disagreed with the given statement. It is
analyses that implementation cost of BIM is high due to which many small construction companies not
able to afford it. Along with the implementation cost, companies also need to trained their employees
which charged cost to develop knowledge of employees regarding BIM. Hence it shows the link between
primary as well as secondary research.
Theme 16: Clients will increasingly insist on BIM adoption on future infrastructures projects
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Analysis and interpretation: according to the collected information it is interpreted that out of 77
respondents, 73 answered and 4 skipped them. 38 participants highly agreed, 30 only agreed that
Clients will increasingly insist on BIM adoption on future infrastructures projects. With the time, clients
are knowing about the effectiveness of BIM adoption. Due to this reason demand on future infrastructure
projects can be increased. On the other side, 73 among them disagreed with the given statement.
Hence, it is analyses that most of the clients are developing their knowledge related to the use of
BIM due to this reason, so that cost overruns and other issues can be overcome. Further
literature review findings reflects that BIM consume cost and time, but these things are for short
term and companies and clients can gain benefits from them in long term.
Theme 17: Construction firms adopt BIM technology because of various reason
Analysis and interpretation: according to the collected information it is interpreted that out of 77
respondents, 73 answered and 4 skipped them. The majority of respondents, 49 mainly identified
that BIM technology is adopted because of coordination. Further 23 said because of client
request and 26 replied reduced time. On the other hand,23 reflected that it reduced cost. Hence it
is analyzed that respondents are aware of various benefits of adoption of BIM technology due to
which they provided different reasons
Theme 18: Construction firms do NOT adopt BIM technology in cost management of construction
projects
Analysis and interpretation: According to the collected information it is interpreted that out of
77, 4 has skipped the question and remaining provided their opinion. Among them 31 said that
lack of qualified and skilled personal is one of the issue due to which companies not able to
adopt BIM technology. Along with this, 41, replied that high cost associated with training staff
and 5D BIM. However, less important options were lack of client request, BIM value is not
proven in industry yet etc. Hence, it is analysed that lack of qualified and skilled personal is one
of the key concern for the company. The literature review findings shows that , the main reason
is either the cost of fully developing a comprehensive model or lack of experience of the team to
input the necessary information.
Theme 19: the current BIM implementation in infrastructure projects in Australia
.
Interpretation and analysis: From the conducted survey it is analysis when question asked
from employees related the increase revenue of BIM implementation significantly outweighs the
cost of BIM in the long run. Participants has provided different comments such as one among
them stated that “Lack of understanding and management by Contractors on how to utilize and
maximize the potential of BIM from design stages to operations” it is analyze that lack of
knowledge is become one of the main issue within the construction company due to which they
not able to adopt BIM . further another respondent respond that architect has used different BIM
software like Revit architecture etc, this all help them in better coordination between different
designers and to identified different design and construction issues. However, at the same time
on one of the author argued that main issue related to BIM implementation was finding designers
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and enough of them is to competent in its use. Hence, it is analysed that there many respondents
who have adopted BIM and now they are using it in effective manner. But some of the time due
to lack of design and knowledge were not able to use it.
Theme 20: BIM implementation can impact the performance of construction projects.
and interpretation: according to the collected information it is interpreted that out of 77
respondents, 73 answered and 4 skipped them. Most of the respondent’s states that improve clash
detection, improve documents management, site management and logistics plans, reducing
overall project cost etc. are highly effective impact of the performance of constructions projects.
Hence it is analyzed that BIM impact was that it helps in improving site management and logistic
plans. Along with this, team collaboration can also improve with the help of BIM
implementation. Further, the findings of secondary research reflect that the emerging BIM
technology represents a framework to manage the building information through the building
lifecycle. BIM can be a catalyst for industry transformation, reduce fragmentation, reduce cost
and improve the efficiency
Theme 21: The increased revenue of BIM implementation significantly outweighs the cost
of BIM in the long run.
Interpretation and Analysis: At the time when question was asked related to the increased
revenue of BIM implementation significantly outweighs the cost of BIM in the long run shows
that out of 77 respondents, 54 strongly agreed, 25 only agreed. However, 10 among then
disagreed and 4 strongly disagreed with the given statement. The increase revenue of BIM
implementation significantly out weights. Hence t is analysed that, the cost of BIM in long run
lead to increase revenue.
Theme 22: Different respondents comments related to the potential BIM impact on cost
overruns in infrastructure project in Australia.
Interpretation and Analysis: At the time when question was asked related to the potential BIM impact
on cost overruns in infrastructure project in Australia. Different respondents has provided different views
such as one among them stated that “ BIM requires full team participation and engagement at the same level
of involvement and consistency with no exceptions”. It is analysed that at the time of implementing BIM it is
important for that team member take active participations. As the manager is highly responsible for the
implementation of this function. Further, one of the respondents state that project is required to setup clear
BIM implementation plan and a level of detail if fully thrashed out before designing designs. There are various
BIM is the utilisation of a database infrastructure to encapsulate built facilities with speci c viewpoints of
stakeholders. It is a methodology to integrate digital descriptions of building objects and their relationship
with others in a precise manner so that stakeholders can query, simulate, and estimate activities and their
effects on the building process as a life-cycle entity.
5. Conclusion and recommendation
5.1 Conclusion
From the conducted research, it is determined that there are various types of findings which can
be determined. Main focus of the research is on developing undersanding related to the adoption of
BIM and its effectiveness for reducing cost of the projects of construction company.
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Overall from literature review finding it is concluded that cost overrun is known as the excess of
actual cost over budget. In construction companies cost overruns is one if the significant issue which
need to overcome. On average, the cost overruns around the globe for infrastructure projects such as
bridges, roads and rail are around 33.8 %, 20.4% and 44.7% respectively. Further, the performance of
construction industry in Australia which is related to the cost and duration are disgraceful. There are
many large rails project which experienced issues related to cost overruns such as Sydney light rail. Etc.
Further, it is concluded that there are different factors which lead to influence cost overruns in
construction projects. One of the major reason which is identified is known as inaccurate estimations of
the project cost and time due to which cost overrun occurred. Sites condition, size of the project,
inadequate planning are known as the factors that influenced cost overruns. The findings of data analysis
concluded that cost overruns is known as the percent of total project cost, increases as the project size
enhanced.
In infrastructure project in Australia, they deal with providing necessities to people in the form of
physical constructions such as rails, bridges, sewage system etc. there are various traditional
practices which help in dealing with cost overruns. 2D delivery model is being used within the
infrastructure projects as hierarchical fragmented linear and prone to promote adversarial
behaviors in the supply chain. However, this method is not effective enough while carrying out
complex projects. The construction industry is basically relying on the 2D based application at
the time of generating the design and construction documents. There are wide range of services
that can be applied within the firm such as the poor collaboration within the team member and
lack of integration. Further, construction industry is still dependent on the 2D CAD based
application that help in generating the design and construction documents. It leads to involve
sharing of sheets in between different parties within the project which are manually handled and
it results improper management and inaccuracies.
Lack of adequate information among project member is also contributed as poor productivity and
rework. BIM model is one of the effective model which can be applied in order to reduce the
cost overruns issues. With the use of BIM companies in Australia can increase the industry
productivity upto 9%. Further from the research it is concluded that BIM implementation has put
impact on the construction industry with the help of return on investment. BIM also helped
company in improving its communication and level of coordination in between project manager
and team. One of the positive impact of the BIM implementation was that it leads to eliminate
the chances of conflicts. One of the effective method of project costing was known as that it can
control the construction project costs. The innovation in this technology is done such as 3D
visualization of the building. There are different dimensions was developed within the BIM
technology such as 4D, 5D and the 3D visualization model. Author state that managers are
responsible for cost overruns within the construction industry. There are different strategies
which can help project manager in minimizing the cost overruns which are linked with the
project. Few of the key strategies are known as process, planning, design management,
procurement management etc. further it is concluded that there are few barriers that can be faced
at time of BIM implementation. The adoption of BIM in construction industries is slower as
expected because of many barriers. Due to lack of knowledge related to the use of BIM
technology it become quite tough to adopt. Along with this, implementation charges are also
high and providing training is important which charge cost. From the findings, it is concluded
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that due to high cost of the implementation it leads to become tough for small construction
company to adopt it. Apart from this, it can be said that contractual issue is also considered as
one of the main issue is known as contractual issue in which information which is shared
between different participants within the project is considered as issue which is not easy to
resolve.
5.2 Recommendation
From the above findings it is recommended that constructions companies should provide training
and development facilities to employees so that they can use BIM technology in an effective
manner. From the findings results it is analysed that employees are not much aware of new
technology. Hence, the lack of knowledge create barrier while using BIM. Further, company
should focus on recommendation companies should focus on developing understanding related
to the use of BIM use and make aware to employees so that they do not resist at the time of
adoption.
Further it is recommended that there are different approaches of the project management and
company should follow them. Among them one of the common framework is known as the
PRINCE2. It is important for companies to little deviate from these in order to deliver a BIM
implementation project.
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