Impact of Delay in Payments of Construction Projects in Australia

This report provides a critical review of three scholarly articles related to the impact of delay in payments of construction projects in Australia. It includes a summary of one of the articles, critical appraisal, preliminary questions, and personal reflection.

Running head: RESEARCH IN PROJECT MANAGEMENT
RESEARCH IN PROJECT MANAGEMENT
Name of the student
Name of the university
Author Note:

1RESEARCH IN PROJECT MANAGEMENT
Executive Summary
The report emphasizes the critical review of three scholarly based articles which are
related to “Effect of delay in payments of a construction project in Australia”. The assignment
has been prepared meeting the requirements of a research project. The report aims to provide a
summary of one of the articles which have been selected. Apart from this, the report aims to
provide an appraisal of all the three scholarly articles which have been reviewed. The various
research question is generated and presented in a proper way. In the end, a personal reflection
has been provided on the provided research topic.

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Table of Contents
Introduction..........................................................................................................................3
Table of identified source....................................................................................................3
Article Summary..................................................................................................................4
Critical Appraisal.................................................................................................................6
Preliminary question............................................................................................................6
Personal Reflection..............................................................................................................6
Conclusion...........................................................................................................................6
References............................................................................................................................6

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Introduction
The topic selected for this report is “Impact of delay in payments of construction projects
in Australia”. This particular topic was selected by making use of research generation tool which
is provided as a part of available resources. This particular topic has been aligned with the proper
interest of various researchers. Construction delays are considered to be the most costly part in
completing any project.
In the coming pages of the three journal articles has been reviewed in details. All the
three article has been provided along with a proper citation. After that critical appraisal has been
done with respect to all the article provided. Along with a list of preliminary question has been
provided with respect to the topic. In the end, a self-reflection has been provided after reviewing
all the article.
Table of identified source
Journal Articles
Keyword
s
Project
management
Contracts with
delayed payments
Cost of delay in
delay construction
projects in
Australia
The Likelihood of
subcontractor
payment
The Effect of
Payment
Delay on
Construction
Projects in
Gaza Strip
Citation Kwon, H.D. and
Yoo, O.S., 2017.
Aziz, R.F. and
Abdel-Hakam,
Hanh Tran, David G.
Carmichael, (2012)
El-Sawalhi,
N.I. and

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Retention of
capable new
employees under
uncertainty: Impact
of strategic
interactions. IISE
Transactions, 49(10
), pp.927-941.
A.A., 2016.
Exploring delay
causes of road
construction
projects in
Australia. Alexandr
ia Engineering
Journal, 55(2),
pp.1515-1539.
"The likelihood of
subcontractor
payment:
Downstreamprogressi
on via the owner and
contractor", Journal of
Financial
Management of
Property and
Construction,
Vol. 17 Issue: 2,
pp.135-152,
Nasser, A.H.,
2015.
Support
Vector
Machine to
Measure the
Risk of
Payment
Delay on
Construction
Projects in
Gaza
Strip. IUG
Journal of
Natural
Studies, 23(2
).
Article Summary
El-Sawalhi, N.I. and Nasser, A.H., 2015. Support Vector Machine to Measure the Risk of
Payment Delay on Construction Projects in Gaza Strip. IUG Journal of Natural
Studies, 23(2).

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The construction industry is a vital industry which is involved in the development of
Ghazi strip. The process of payment is known to be an important part in construction industry or
domain. Any kind of delay in construction strip can easily result in dispute in the construction of
Ghazi strip. The ultimate goal of this article is to analyze the various cause and effect which are
involved in the delay of payments. It helps in analyzing the effective kind of solution which
helps in overcoming various risk and effect of payment delay in Gaza Strip construction. In this,
various kinds of tools have been discussed like critical path method and project evaluation
technique. These particular tools are considered to be effective for understanding the uncertainty
understanding the completion time and project cost. Apart from this, there is a certain number of
ways which can be used for managing the projects with considerable uncertainty which arises in
construction, development and any kind of defense. It is important for customers to easily
analyze any contracts which suppliers have after the completing any task. But currently, there are
mainly instances in manufacture poses “Delay Payment” in which supplier is paid only when he
has completed the task.
The ultimate goal of this paper is to analyze various kinds of risk which can arise in a
delay of payments. The ultimate goal of this paper is to have an analysis of the three vital section
like the cause of delay in payments, the proper solution to over the problems. A list of question
has been put to certain section like contractors, owners and lastly opinions of consultants. The
last question is to develop support vector machine that is the SVM model for measuring risk. The
paper mainly checks the list of reasons for the delay in construction projects in Australia which is
the point of view of contractors and owners. It also discusses the importance of consultancy in
reducing delay in large projects and along with it showed possible ways of managing delay like
internal and external, financial and non-financial.

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Critical Appraisal
The construction industry is taken to a vital domain which is used for development of
Gaza Strip. Method of payment is considered to be a vital factor for any industry. Delay in
payments to different contractors is considered to be a vital factor for dispute in the construction
industry of Gaza Strip. The ultimate goal of this research is to easily identify the various cause
and effects of payment delays. The article (El-Sawalhi and Nasser, 2015) states that the best
ways to overcome the effects the risk of payment and delay in the construction industry in Gaza
Strip is to easily formulate a model which can be used for measuring various kinds of risk
involved in delay of payments. The ultimate goal of this paper is to analyze three section that are
payment delay, possible effects of delay in payments and proper methods to mitigate the
solution.
Many multinational organizations have expanded their operation in Australia due to
management activities. The paper (Kwon and Yoo, 2017) describes two kinds of payments that
are delay payments and no-delay payments. Under the conventional rule, no kind of delay in
payment is seen when the supplier receives the payment after the completion of the project. But
under the matters of delay payment, it is seen that all the suppliers can easily complete the task
as per the requirement. The construction project is considered one of the vital factors which
affect the economy of this country. With the development of economics in Australia, building
construction is a much larger portion of the whole construction domain. In this paper (Hanh
Tran, David G. Carmichael, 2012), a list of factors has been discussed which is considered to be
important for any construction project in Australia. The main cause of project delay is owner,
consultant and lastly contractors. The paper (Aziz and Abdel-Hakim, 2016) discusses the fact
that contractors need to manage all the financial affairs along with understanding the importance

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of receiving payments for the given work by various owners. Contractors show a delay in
payments to subcontractors for improving the flow of cash at the time when payments are late.
Unscrupulous contractors many times take advantage of any kind of small contracts which is
done due to delay in payments without any proper reasons.
Preliminary question
After analyzing the three articles of the topic “Impact of delay in payments of
construction projects in Australia”, it can be easily concluded that the research question is all
about the delay in a construction project.
The main questions of this research are
How can a supplier adjust his/ her rate of work, manufacture of optimal profit?
Giving a revenue regarding the payment p, then what is supplier optimal work rate?
What is the condition of one regime profit from various manufacturers?
Personal Reflection
I have learned a large number of reasons behind the delay of a construction project in
Australia. This has become possible due to the undertaking of course which is provided by the
university. Along with this, I have learned about a large number of things from both the tutor and
website. I have gained all kinds of information and support which is needed for completing the
assignment independent way.
Conclusion
From the above discussion, it can be concluded that this report is all about understanding
“Impact of delay in payments of construction projects in Australia”. For this particular topic,

8RESEARCH IN PROJECT MANAGEMENT
three articles have been reviewed. These three articles have helped in understanding the topic in
a much better way. In the above pages of the report, some important aspects have been discussed
like a summary of each and every article, critical appraisal, research question and lastly personal
reflection has been provided. The ultimate goal of this paper is to easily identify a large number
of the cause behind the delay in projects. The most vital kind of factors which is taken into
consideration is a delay in the value of contractors, change in owner or agent during any kind of
construction and a proper normalization.

9RESEARCH IN PROJECT MANAGEMENT
References
Aziz, R.F., and Abdel-Hakim, A.A., 2016. Exploring delay causes of road construction projects
in Australia. Alexandria Engineering Journal, 55(2), pp.1515-1539.
El-Sawalhi, N.I. and Nasser, A.H., 2015. Support Vector Machine to Measure the Risk of
Payment Delay on Construction Projects in Gaza Strip. IUG Journal of Natural Studies, 23(2).
Hanh Tran, David G. Carmichael, (2012) "The likelihood of subcontractor payment:
Downstreamprogression via the owner and contractor", Journal of Financial Management of
Property and Construction, Vol. 17 Issue: 2, pp.135-152,
Kwon, H.D. and Yoo, O.S., 2017. Retention of capable new employees under uncertainty:
Impact of strategic interactions. IISE Transactions, 49(10), pp.927-941.

10RESEARCH IN PROJECT MANAGEMENT
Appendix: Synthesizing Matrix
Themes
Article 1 Article 2 Article 3 Article 4
Sample and
Methodology
Methods
entitled here
comprises
responses
from various
contractors.
The
geographical
limit has not
been stated
yet. The
researchers
have stated
the fact that
good
scenario and
in various
countries like
Saudi,
Australia.
Methods are
mainly used
for
conducting
literature
review with
various
personals,
face to face
interview and
lastly group
meetings. It
also
emphasized
on certain
reasons
behind
delays in
payments in
the
construction
industry.
Collected
data
empathized
on the
probability of
payment
which is a
function of
time. The
paper also
provided an
idea
regarding an
example of a
data set. The
last section
of paper
deals with a
statistical
analysis.
Data
collection
methods
emphasize
the various
kinds of
causes and
effects which
is
encountered
due to delay
in payment.
The paper
emphasizes a
list of
questions
which is
obtained
from Gaza
Strip
contractors,
owners and
lastly
consultant.
Delay in the
construction
industry
This
particular
paper
emphasizes
the
adjustable
work rates.
Along with it
emphasizes
on no-
delayed
payments
and delay
The article
emphasized
on the list of
delay behind
the delays
which were
encountered
for the
projects in
Egypt.
The article
emphasizes
on the
current
Markov chain
model which
is used for
the
formulation
of owner
payments.
This
particular
paper
focuses on
the methods
which can be
used for
improving
the contracts
and also
comes up
with the
ability to

11RESEARCH IN PROJECT MANAGEMENT
payments focus on the
delay in
payments
and its effect
on the
project.
Factors
affecting the
construction
industry
In the article,
an idea has
been
provided
regarding
delay
payments.
Currently,
the
organization
focus on
delay
payments in
which
suppliers
only when
contractors
have paid the
amount.
In this article,
a list of
reason has
been
discussed
from the
point of view
of various
domains like
contractors,
participants
and lastly
owners.
The article
discusses a
proper
method
which can be
used for
calculating
the
probability,
amount of
claim which
is left
The ultimate
goal of this
paper is to
analyze the
factors which
can easily
result in a
delay of
payments.
Along with
this
emphasized
on a large
number of
ways which
can be used
for
measuring
the risk
involved in
the delay of
payments.
Cause of
delay
The article
discusses the
adjustable
work rates.
The
manufacturer
will have a
total revenue
from a
customer as
soon as the
given project
is completed.
The article
discusses us
to examine
how the
payment
affects the
optimal work
rate of
various
suppliers.
A particular
model has
been
discussed
which is used
for providing
an idea
regarding the
fact that how
contractors
have an idea
regarding the
claim
The articles
discuss on
the
contractors
who come up
with bank
loan just
because of
delay in
payment.
Delay in
payment
gets a bad

12RESEARCH IN PROJECT MANAGEMENT
depending on
owners and
contractors.
impact on a
various
department
like
contractors
who come up
with small
capital.