Construction Project Delay & Cost Overruns: Case Study Analysis

This report presents an exploration of the causes of delay and cost overruns in construction projects, focusing on case studies from Australia, Malaysia, and Ghana. The study analyzes quantitative data and employs questionnaire surveys to identify influential factors in each country. Key findings reveal that planning and scheduling deficiencies are significant in Australia, payment delays and project cost underestimation are critical in Ghana, and contractor planning and site management issues are prominent in Malaysia. The research highlights the diverse nature of delay factors across different countries and emphasizes the need for tailored measures to mitigate the impact of these factors on project timelines and budgets. The report concludes by advocating for specific strategies to minimize the adverse effects of delays and cost overruns within the construction industry.

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
Journal of Advanced College of Engineering and Management, Vol. 2, 2016
AN EXPLORATION OF CAUSES FOR DELAY AND COST OVERRUNS IN
CONSTRUCTION PROJECTS: CASE STUDY OF AUSTRALIA, MALAYSIA &
GHANA
Raj Kapur Shah
Senior Lecturer, Department of the Built Environment, Faculty of Technology and Environment,
Liverpool John Moores University, Liverpool, L3 3AF, United Kingdom
Email Address: [e-mail]
__________________________________________________________________________________
Abstract
Cost and time overruns are the key problems of any construction projects. These issues are causing the negative impact on
the development of country economic growth and prosperity. To overcome these issues, the paper is aimed to discover the
most influence factors causing the project delay and cost overruns and recommend the possible measures by investigating
case studies in three different countries in the world. Each country’s quantitative data from the past studies was selected to
analyse and recommend the effective measures. A questionnaire survey was conducted in all three case studies adopting
different data collection strategy. The reason of selecting three case studies is to outline the compare analysis of delay factors
and to classify why different delay factors have different priority level of influence in project delay from one country to
another country. The findings from the case studies exposed that the most influential factors in Australia are (1) planning and
scheduling deficiencies, (2) methods of construction, (3) effective monitoring and feedback process, whereas in Ghana, (1)
delay in payment certificates (2) underestimating of project cost, (3) complexity of projects are the most influential factors.
However, in Malaysia (1) Contractor’s improper planning, (2) poor site management, (3) inadequate contractor experience
are the most influential factors. This paper has also analysed the average and least impact of the delay factors causing project
delay and cost overruns in those countries. The paper concludes that there are diverse groups of delay factors from one
country to another country that causing project delay and cost overruns. It also concludes that there are diverse measures
according to the nature of delay factors to reduce the impact on project delay and cost overruns in construction industry.
Keywords: Cost and time overruns, delay factors, construction industry, projects delay, and developing countries
__________________________________________________________________________________
1. Introduction
Construction delays are more likely to happen in almost all projects due to the miscommunication
between contractors, subcontractors, property owners or any other reasons. In many cases,
construction projects are delayed because of inaccurate estimate of time and project cost that was
initially presented to the clients or project owners. Delays and cost overruns are the most common
problems causing delay in the construction industry in both developed and developing countries
(Enshassi, 2009). A study by Flyvbjerg (2003) exposed that nine out of ten projects had the cost
overruns from a sample of 258 companies across 20 countries and 5 continents around the world. In
practice, delays occur in every construction project and the magnitude of these delays varies
significantly from project to project and country to country (Wael et al, 2007).
Construction industry plays an important role in contributing on national economy around the world
(Takim, 2005). The construction industry also impact the rate of GDP and employment of many
countries, and for this reason, the construction industry is considered to be vital for the economic
growth of a country (Olawale, 2010), and he suggested that the construction activities have become a
significant market indicator since this industry produces more products and consume more materials
than other industries. The cost overrun is one of the critical problems and requires a lot of research
studies and exploration to minimise or reduce the delay and less variation in budget for the future

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
projects. In some of the developed countries, the cost overruns consequence could be more serious
and the results could sometimes exceeds 100% of the initial project estimated (Angelo, 2002). The
construction industry is one of the main sectors to stimulate and provide ingredients for the
improvement of a country economy. Therefore, it is considered that the construction has a great
connection and play significant roles in the economic growth or reactivation in all countries.
Delays are constantly occurring in road construction projects and they could causes great impact on
economic growth. It is one of the common problems that upset the construction companies in terms of
competitiveness and long term sustainable in the global market. Due to the population growth,
industrialisation and urbanisation, more roads and highways are required for the easy access to market,
economy and other vital purposes such as transportation and delivering goods and services (Mahamid,
2012). He highlights that cost is one of the major issues which has to be considered throughout the
project life cycle and it can be considered as one of the most important factors cause the project to
delay and failure if appropriate consideration is not taken into account. The issue of cost overrun in
project is attracting more researchers over the past decades and still more research are running to
address the issue.
Moreover, there are many risk factors causing cost overruns in the construction industry, therefore,
researchers tend to take this issue into further scrutinise with aim of identifying the factors and their
ranking of importance. In recent study, researchers have tried to discover the reasons behind the initial
estimated and final amount, and other causes of time overrun. Morris (1987) found four key factors
that were the most likely influenced on cost overruns. These factors include design changes, poor
planning, unpredictable weather condition and the fluctuation in prices of building materials. It is
important to have in depth understanding of the outstanding issues in the construction industry. Hence,
the paper aims to provide in depth light about the existing causes of project delay and cost overrun in
both developed and developing countries, and outline the possible recommendations for controlling
project delay and cost overruns in future projects by analysing the case studies from different
countries.
2. Literature Review
Kaming et al (1997) conducted a study on thirty one high rise projects in Indonesia, and the study
revealed that the cost overruns are more likely to occur than time overruns, which means that the issue
of cost is more important and common than the project delay. He found that majority of the problem
causing cost overruns are due to increase in material prices and currency inflation, whereas the delay
in time was due to inaccurate estimation, design changes, poor labour productivity, inadequate
planning, and shortages of necessary resources. Similarly, a survey was conducted by Assaf (2006)
and identified a total of fifty six main risk factors, which were more likely to cause the project delay.
Delay factors are grouped into nine major factors in terms of their level of importance to different
parties. Howick et al (2009) stated that construction projects can suffer massively in time and cost
overruns because of mainly two reasons: to gain learning for future projects, and to claim
compensation from one to another party during the project.
Moreover, a survey was conducted by Greenwood et al (2005) aimed to find the subcontractors
liability in project delay. They found that despite the level of importance of agreement between the
two parties, there is advantageous way of dealing with such delays and that could be subjected to
Liquidated Damage. The survey also found the most common method for dealing with such delay
liability in subcontract is to base damage upon proportion of main contract liquated damages (LD).
The delay in subcontractors delay has to be dealt with before the start of the project, by agreeing to

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
the terms in both sides. Having an appropriate planning scheduling can decrease a significant number
of potential reasons for project to be delayed as the scheduling gives clear indication how a project
and people are performing, since appropriate scheduling tells when an activity should be finished
whereas on the other hand, effective monitoring will ensure that particular activity finishes in its
estimated time, this will show the project is working according to the plan and the next activity will
start without any delay. All of these three important factors have to be considered and advanced
procedures to be used to avoid controlled delay.
Furthermore, a study conducted by Assaf (2006) found that any changes made by client during the
construction period would affect in progress payment by client. Other causes are improper planning
and scheduling of projects by contractor, poor site management and supervision by contractor,
shortage of labour, difficulties in financing project by contractor. This shows that changes made by
client while construction is already in progress will not only slow the progress but also affect
everything that contractors has planned for the project in terms of materials delivery schedule or any
activities that were due to finish on time. Such changes made by client could stop the work and
increase project cost and delay the delivery schedule. The cost and time overruns are the two common
factors frequently occurring within the construction projects. The past project history shows that the
construction industry has vast number of projects were completed with time and cost overrun (Amehl,
2010). In addition, Al-Momani (1996) suggested that the actual estimated cost of project rises by up
30% by the time the project is ready to be completed even in the most developing countries.
Noulmanee et al (1999) has investigated the causes of delay in highway construction in Thailand and
the survey result showed that the delay are caused by all parties were involved in the project, even the
main reason was due to inadequacy of sub con tractors, organisation not providing required resources,
unclear drawing and lack of communication between consultants and contractors. Noulmaneeet al
(1999) suggested that delay can be minimised by better understanding and involving all parties in the
project with good communication between them. Similarly, a survey was conducted in Lebanon by
(Mezher, 1998) and he found that the owners were more wary of their financial issues, contractors
were not very keen about their relationship with other parties, and there was a lack of trust in
guaranteeing and complying with the agreement. But it was found that the poor management by
consultants was key reason of the delay. There were three main causes of cost overruns identified
by(Koushki, 2005) in a study in Kuwait, which include contractor related problems, material related
problems and owners’ lack of experience.
Ellis (2002) conducted a study to investigate main causes of delay in highway construction projects.
The study was split into two categories: excusable and non-excusable delay and found that on average
31% to 55% of all highways experienced a delay of 44% extra from the original agreed period. The
study also highlights that the delay mainly occurs more frequently in the urban areas. Similarly,
Jahren (1990) discovered that the quality of the contractor document, nature of the interpersonal
relation on the project and the policies of the contractor were key factors causing a significant impact
on cost overruns. The same investigation also exposed that a cost overrun rate from 1% to 11% are
more likely to occur on larger construction projects than smaller ones.
Moreover, a significant number of researchers have been involved in identifying causes behind the
delay in the construction projects and a lot of work has been carried to minimise such problematic
issues occurring in almost every project in every country worldwide. Six outcomes of delay were
identified by (Sambasivan, 2007) which comprise of time overruns, cost overruns, disputes,
arbitration, litigation and total abandonment. In many occasion, the delay happens due to human
errors and careless attentions to facts from either client or other team members of staff. Sibanyama

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
(2012) suggested that difficulty of establishing fair and expeditious settlement of claims depended on
untimely notification, poor record keeping, inadequate legal and factual justifications and poor
presentation. It is vital for contractors to fully understand the client’s requirements and fully commit
in providing services accordingly.
Furthermore, some authors believe some of the factors causing delay or cost overruns can be
classified as understandable and other parties should understand the situation of others where they
believes cost overruns due to their inaccurate estimation. Similarly, Chan (2002) identified other
reasons causing cost overruns and classified them into 3 aspects such as owner’s control, consultant’s
control, and beyond the control. Whereas, Bramble (1987) classified major delay factors into four
categories: excusable or non-excusable delay, compensable or non-compensable delay, critical or non-
critical delay, and concurrent or non-concurrent delay. Excusable are those delay arising from the
outside the control of the parties to the project such as acts of God where an unexpected weather
occurs or a strike action by labour, there are nothing can be done about such delays. Non-excusable
are those delays that one cannot have any excuse or can provide an excuse because the delay occurred
within due to careless of the contractor or consultant for slow progress. Compensable delays are those
delays where contractors and subcontractors have legal right to get a time extension from the agreed
finishing date of completion as this occurred due to the owner’s requirement change of plan, and
they’re entitled to additional financial compensation for the cost of delay. Nonetheless, Yates
(2006)suggested that non-compensable delay occurs due to acts of God where the fault are not from
any parties and therefore, the contractor is entitled only to extension of time but not additional cost.
2.1 Factors affecting project cost and time overruns
Construction is considered as an active industry and therefore delay in the construction project has
been one of the main subjects for many researchers. Delay is one of the major risk factors for both
contractors and owners and causes difficulties within the project and then leads to cost and time
overruns. Chan (2004) highlighted that the cost overruns to be one of the most critical issue at the
execution stage of the construction project. Also stated by (Van Der Westhuzien, 2005), the presence
of cost overruns can be a reason behind the failure of a project. But not all authors agree that the
failure is viewed from one single factor but many believe there are a significant amount of factors
causing the delay. However, Morris (1987) suggetsed that there are three different measures to
identify whether, the projects is successful or not. Project should perform functionality, management
of the project and performance of the contractors during the process. In the other hand, Chan (2004)
suggested that the key to a successful project completion and deliver is correct estimation, monitoring
time performance, cost performance and the overall quality of the construction project.
2.2 Delay in the developed countries
The delay and cost overrun are also key issues in the developed countries. For example, Bourn (2003)
published a report entitled “Modernising construction” and highlighted that 70% of the UK
construction projects, which are carried out by public departments and agencies, are delayed. A
research conducted by Building Cost Information Service (UK) found that nearly 40% of the
construction projects overrun the originally agreed contract period. Similarly, a survey was carried out
by Mansfield (1994) amongst contractors, consultants and clients in Nigeria and he found a total of 16
factors causing the project delays and cost overruns, whereas some of critical risk factors were finance
arrangements for payment, poor contract management, shortage in materials, inaccurate estimation
and price fluctuation. Moreover, Arditi (1985) conducted a survey amongst 146 organisations in
Turkey and he found that the main reasons causing the cost overruns are the increase in materials’

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
prices due to fast growth of Turkish inflation. The increase in inflation then made it difficult for
contractors to buy materials at official prices which they have already estimated at the beginning or
prior to the project, and that also affected in selling their products at the estimated prices. This fact
was considered as the most important reason for cost overruns. Furthermore, a shortage in resources,
changes in design specification and financial problems were the other reasons for the cost overruns
and project delay. Finally, the fifth reason was underestimation of the project cost at the time of
setting the budget. Arditi (1985) ranked the main causes for delay and cost overruns in construction
projects found in Turkey as follows:
1. Increase of materials' prices
2. Fast growth of inflation
3. Inflation increase causes contractors to produce products at the agreed price.
4. Delays caused by changes in design specification and financial problems.
5. Underestimation of project cost when setting the budget of the project
2.3 Delay in the developing countries
According to Rabbani et al (2011), the most common factors that cause the construction delay in
Pakistan are external factors due to natural disaster such as earthquake and floods. Similarly, Bramble
and Callahan (2010) found that unexpected problem such as act of natural phenomenon also causes
the project delay. Other factors causing delay in Pakistan are financial payment issues, poor planning,
poor site management, lack of experience and shortage of materials and equipment. In other hand, the
main reasons for delay in Saudi Arabia are due to the lack of qualified man power in the industry (Al-
Kharashi, 2009). In another study by (Sriprasert, 2000)highlighted that the main reason of project
delay and cost overruns is the lack of capability of controlling the construction processes in Thailand.
Moreover, the construction projects varies in terms of complexity in nature, location, type of contract,
communication between parties, and less experienced people in such situation can have significant
risks to project delay and cost overrun (Ahmed, 1999).In a study done by (Kaming et al, 1997) found
that contractors agreed that, the main factors causing delay and cost overruns in Indonesia are due to
improper estimation for material take-off and price inflation due to environmental restriction.
Performance of the construction project plays an important role in delay and has significant impact on
the time scheduled for the project. Ajanlekoko (1987) conducted a research in Nigeria and found that
the construction industry’s adherence to the contract schedule was very low. Similarly, a number of
researchers such as (Ogunlana, 1996;Al-Momani, 2000; Frimpong, 2003 and Chan, 1997) have
carried similar survey in their chosen country and they found that the delay in the construction
projects is inevitable depending on the geographical location and nature of the construction project.
A study was conducted by Battaineh (1999) within164 buildings and 28 highway projects constructed
in Jordan during the period of1996-1999, and he revealed that the actual completion period increased
by 160% in road construction projects and 120%in building projects compare to the initial estimated
time. This is because of the project complexity in nature and varies from one location to another
location geographically in the world and the issues of delay and cost overruns are common,
particularly in the construction projects in the developing countries. Moreover, Assaf (2006)
conducted similar study in the Saudi Arabia and he exposed that only 30% of construction projects
were completed on time and 70 % project were delay whereas the cost overrun was between 10% and
30% which leaves a significant proportion of delay in the country. This can be seen as major factors in

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
the most developed country in the Middle East. Past statistics showed that majority of projects are not
delivered on time and in the agreed budgeted cost at tender stage in the construction industry. The
next section describes about the research methodology adopted in the study.
3. Research methodology
There are different approaches to conduct research but the qualitative and quantitative are common,
which are used regularly and widely in the build environment sector for analyse purposes. Therefore
the research approach adopted in the study is a quantitative approach in order to identify the causes of
delay and cost overruns so that the impact from these causes could be reduced by taking proactive
actions. Punch (2005) suggested that research approach depends on the research questions prepared
for the study, whereas Rea (2012) explained that there is no better approach to a quantitative research
study than a survey for collecting information amongst large population. The quantitative data from
the case studies using tables, graphs and figures is helpful to examine and interpret them more
effectively.
The quantitative approach is used in the study, which is based on the secondary data and this was
collected from the past publications for further analysis. In this approach, mainly a survey was
conducted by designing a questionnaire and distributing them to the targeted respondents randomly
before collecting and analysing them to draw the findings from the survey. The purpose of using case
study is to get in depth understanding with their data that and explore the data for further analysis so
that a comparative analysis of their similarities and the uniqueness of each project could be presented.
There are many causes for the cost overrun and delay in construction industry and different areas
could possibly have different reasons of delay, therefore, it’s important to understand causes of delay
around the world. Analysing their data assists to provide a better understanding of the reasons of delay
and a suitable recommendation for future project and different scenarios. This is also helpful to
identify the possible measures in order to reduce the impact of delay and to give something to be
considered for the upcoming events. Therefore, the analysed data gathered from secondary sources to
be used as quantitative data for acquiring further understanding of the dilemma and directing to a
better path.
4. Case studies and data mining
For the comparative analysis and depicting the findings, three case studies of construction projects
were selected from Australia, Malaysia and Ghana considering developed and developing countries
around the world. Each country has uniqueness in dealing with construction and businesses, therefore,
many countries have different reasons causing the project delay and cost overruns. Hence, identifying
causes of delay in each country separately augment better understanding for future warning and pro-
active actions to be undertaken in future project. Analysing different countries around world also
provide a vision to see which factors are common and why such factors are ranked as the highest
threat in delaying the construction projects and cost overruns. The delays in road construction project
have brought the attention to the community to why such incident always occurs and why time
estimated by consultant does not meets the deadline. Since this is one of the most common and
frequent problem in the construction industry, many researchers have studied and discussed for
decades but the delays still happens in almost every construction project. The delay could have
different reasons as for the project various from project sizes, locations and the scope of the projects.
Some of the project happens to be late for few days and some could be delayed for years from the
estimated time. Many researchers have studied this problem within the construction industry but it is

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
vital to identify all possible causes of delay in order to bring a solution to reduce the impact from
delay in the future construction projects.
4.1 Delay and cost overruns: A case study of Australia
An investigation was carried in Australia about cost overruns and failures in construction project
management. The purpose of this research was to get a clear understanding of the current
performances regarding the cost and management issues and can obtain clue about the critical factors
having impact on the cost overruns in the construction industry. The methods was used questionnaire
survey, the aim of this method was to obtain some data from consultants, and contractors, who have
experience in construction. Over 160 responses from clients, consultants, and contractors were
selected based on their background, experience and active participation in the construction industry.
Clients, consultants and contractors play key role in a construction project and the non-excusable
types of delay are usually related to the inaccuracy of their responsibilities, therefore, it is extremely
important to interview them and investigate their responses and analyse them to give a better
understanding and to determine from their experience what are factors causing project delay and cost
overruns in the construction projects. General information about the respondents who participated in
the survey is shown in Table 1 below.
Table 1 General information of respondent and questionnaire (Source: Doloi, 2013)
Field of
work
Respondents
(%)
Experience
(years)
Respondents
(%)
Project budget
($m)
Respondents
(%)
Clients 25 <1 2 <5 2
Consultants 31 1-5 16 5-25 8
Contactors 44 5-10 36 25-75 20
>10 46 75-150 59
>150 11
Findings
The total numbers of 100 out of 160 responses were collected from clients, consultants and
contractors in Australian construction industry. The table above represents their responds in respect to
their career history and the size of the project they are involved in terms of budgets. The table shows
that almost half, 46% had at least 10 year or above experience and only 2% had less than one year
experience in the construction industry which means over half 52% have at least 1 to 10 year
experience. The last column in the table shows the percentage of budgets which can be found that the
budgets between $75 to $150m tops the table with 59% and only 2% are less than $5m and the second
highest 20% in the range of $25 to $75m, whereas 11% of the respondents shows their budget were
over $150m.
Data analysis
There are many ways in analysing the collected research data. The researcher have used Relative
Importance Weight (RIW) technique for ranking the critical factors since it is widely used in
quantitative analysing, particularly in build environment (Chan, 1997). The researcher organised
questionnaire in the form of importance scale, by asking contributors to tick columns which indicates
its relative importance of each of the cause construction in terms of contestant expressing the weight
(5 = very low, 4 = low, 3 = medium, 2 = high and 1 = very high). The RIW score is a useful measure
of the relative positioning of a particular attribute perceived by the respondents on the raw dataset
(Chan, 1997). The RIW method was used in this research is as follows:

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
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A survey conducted by Doloi (2013) using a questionnaire survey and found48 attributes/factors were
identified associated to client, consultant and contractor causing poor performance management in
construction industry in Australia (for details of factors see appendix-A). This study was aimed to find
what causes influence on cost performance. It was revealed that planning and scheduling were ranked
at number 1 of the list making it the most critical factor causing poor performance. The second and
third factors are methods/techniques of construction process and effective monitoring/feedback
process which seem all three factors are related with the proper management. The two factors ranked
in the middle of the table are delay in subcontractors’ project and lower labour productivity. The list
of most significant factors casing delay and cost overruns were listed that need to be considered in a
construction project (see appendix-A).
4.2 Delay and cost overrun: A case study of Ghana
Construction industry in Ghana plays an important role of providing and boosting country economy
according to Ghana Statistical Service in 2007. The construction industry contributed in the national
economy was 8.5% of GDP. Any construction projects being subjected to delay can have significant
impact on the overall income of the project, therefore, it is vital to ensure the construction industry is
performing well and brings good service to the government and business sectors. As Ghana is
planning to immense their economy in order to become a middle income nation which was due by
2015 and their recent discovery in oil fields in the commercial quantities boost the target.
Governments across the world are investing a vast amount of money in identifying a solution for
eliminating or minimising the impacts from factors that causing project cost and time overruns in the
construction projects.
Findings
A study was carried out in order to identify major factors causing delay in building construction
projects in Ghana. The researcher used questionnaire survey approach in identifying and
understanding the reasons behind the delay in construction industry and perceptions of the three main
parties who play main roles in this industry so that possible ways in minimising the impact on delay
and project cost variation could be identified. The researcher believed the delay is one of the major
problems facing in Ghana and this issue is growing since the delay is happening in regular basis in
Ghanaian construction industry. Therefore, the research found a gap in this study. But the gap still
exists in many construction projects worldwide, where appropriate planning has been undertaken to
ensure the project would be finished on time and within budgeted cost but unluckily the delay is
happening in almost every project and consequently overrun the project cost.
Table 2: (Source: Fugar, 2010)
Respondents Questionnaire
distributed
Responses
returned
Percentage of
responses
Client 55 37 67%
Consultants 55 39 71%
Contractors 55 54 98%
Total 165 130 79%

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
Discussions
The researcher has used the Relative Importance Index (RII) to identify top critical factors causing the
delay. The questionnaire was prepared and sent to the three main categories: client, consultant and
contractors in the form of the importance scale by indicating to tick a column of the relative
importance of each cause of delay. A total number of 165 questionnaires were distributed, as shown in
the table but response rate was 79% (only 130 response were received) and use these responses for
analyse. Each response represents importance in terms of (4 = very important, 3 = important, 2 =
somewhat important and 1 = not important).
The survey results showed in table (for details see appendix-B) that a total of 32 possible cause of
delay were identified. The results showed that “delay in honouring payment certificates” are the top
most delay factors and they have all agreed this factors as a prime cause of delay. The issue of late
payment is very common in non-developed countries. Another study in Malaysian construction
industry also justify that the impact of the late or non-payment to contractors result the delay in the
progress of the project or they might force to abandon the project. Therefore, paying everyone
involved in the project on time could improve the chance of project finishing on time.
The second factor “underestimation of cost of projects” was highly ranked by client, whereas,
consultants have ranked this at their number 3 in their importance factor (see appendix-B). In contrast,
contractors have only ranked this issue at number 5, which could be the reason that contractors are
those to estimate cost and therefore they don’t want to blame themselves for it. And again the same
case applies to the third ranked factor which is the “underestimation of complexity of projects”, which
consultants ranked at number 3 and at number 8 by contractors because they don’t want this factor to
be in the higher ranks. The mid table factors (see appendix-B) are “poor design and breakdown of
equipment”. This reflects that Ghana doesn’t seem to be facing any major problem with construction
design planning which means the place where this factor is ranked as a good place considering other
factors. The least factor to cause delay in Ghana was shown in the table (appendix-B) was “Public
holidays”, the fact that this does not impact on the delay due to the acknowledgement of the holidays
before hands. However, when an agreement is done between parties, the public holiday has already
been considered and time is considered to be longer, therefore, public holidays can’t be an issue or an
excuse when a construction is delayed.
4.3 Delay and cost overrun: A case study of Malaysia
The cost and time overrun is a global issue and it is happening in every part of the world and every
country but yet the problem still exists and happens for various reasons. In 1991, Malaysian
Government introduced a vision for a strong and better industrialisation in economy. The proposed
vision was called “Malaysian Vision 2020”, by defining a clear path for making Malaysia one of the
developed nations. The main purpose of this vision was to transform the country into competitive and
dynamic resilient by the year 2020. Ever since the construction industry sector play a significant role
since this industry can provide better contribution in national economy and GDP growth. Therefore,
construction industry has to be very effective in terms of delivering project on time without vitiating
any loss and the industry must perform appropriate, and finally the country must compete with other
developed nations in the world with aim of accomplishing the vision and mission. The construction
industry has developed in Malaysia, but just like many other countries in the world but the projects
are facing major loss from time and cost overruns. To better understand this matter and find a
solution, a questionnaire survey was undertaken to find out what are the project facing with cost
performance to be analysed and looked at.

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
Findings
In this case, the researcher has also used Relative Importance Index (RII) method to identify their
importance of causes and effect of delay factors, which is also used by Kometa (1994). The
questionnaire was send to three groups (clients, consultants and contractors) who play main roles in
construction projects. The same method was also used in Ghanaian construction industry survey,
where the scale is used ranging from 1 being not important and 5 very important. The (RII) was used
to identify which cause are the most significant causes by ranking them into their RII importance
values. A total number of 150 respondents participated in the survey in which ten were identified the
most effective factors causing delay and cost overruns from the list of 20 (Soon, 2007). The top 10
most important factors, which found from the survey in Malaysia construction industry, are as
follows:
1. Contractor’s improper planning
2. Contractor’s poor site management
3. Inadequate contractor experience
4. Inadequate client’s finance and payments for completed work
5. Problems with subcontractors
6. Shortage in material
7. Labour supply
8. Equipment availability and failure
9. Lack of communication between parties
10. Mistakes during the construction stage
Discussions
From survey results, it clear that the primary reason for the delay is the lack of appropriate planning in
the construction project followed by poor site management. What can also be seen is that the pressure
is more on contractor than clients or consultants. This could be the result due to the fact they want to
blame other people responsible for the delay. In contract, the contractor is also blaming subcontractors
which confirm the communication between the parties is not in a professional way and each want to
blame each other for delay. Contractors seem to have insufficient experience within the industry
which could cause the project to perform well and could slow the progress as a result of it. The fourth
most critical factor is “Inadequate client’s finance and payments for completed work” which is vital in
any construction project because late payment always slow the progress or could make them to
abandon the project. In other cases, where the project is completed and the payment’s still due, the
company can lose its reputation and make it harder for other to cooperate with them in the future.
4.4 Outcomes from case studies
The available data and information acquired from the past studies illustrates that the key factors of
causing the project delay varies from one country to another country. For example, in Ghana the most
critical factor and threat to the project delay is the delay in payment which could have significant
impact on the project progress and its performance in terms of quality and services. In contrast,
Australia and Malaysia share the most of critical factors are similar. For example, the lack of planning
and scheduling by contractors would affect the estimated targets within the agreed budget and the
consequences of this could result in project delay and cost overruns. The 2nd most factored causes
placed in Ghanaian ranking is underestimation of the project cost, This factor is more frequent in the
undeveloped country or a country in the process of developing in the construction industry and the
reason for underestimating the cost is might be due to the price inflation in the country or lack

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
unavailability of materials and time variation could also change materials prices. However, in
Malaysia and Australia, poor site management and ineffective construction techniques are ranked as
2nd most influential factor for delay project.
One of the common factors shared in both Ghana and Malaysia, which ranked in 3 rd place, is the lack
of contractor’s experience in the construction industry and underestimation of the complexity of the
project. In general, these two factors are related to one another in terms of improper management of
project. The project manager must be someone having experience in similar industry to forecast
possible causes from beginning to the end of a construction project in terms of dealing with all aspects
including subcontractors and owner and to deal with it in appropriate manners when arise any such
incidents. If someone with sufficient experience is appointed to be the project manager for a project,
they are more like to organise better by analysing the complexity of the project with aim of
accomplishing them in the efficient way. In contrast, 3 rd ranked factor in Australia is related to the
poor site management. What Malaysia is also lacking behind the developed countries is the
insufficient payment from the client and payment after the work is completed, but Australia must be
handing work to someone with adequate experience in construction industry in order to find an
appropriate way of handling complex design. Whereas Ghanaian government needs to find an easy
way of accessing credit from bank as delay in payment in that country is ranked number influence of
factors causing delay.
5. Conclusions and recommendations
In conclusions, it is found that three case studies used in the paper adopted the questionnaire survey as
an approach to collect research data and understand the questions of delay in the construction projects
in both developed and developing countries. The survey results found that the most critical factors
causing delay and cost overruns and ranked them from the most to least influential factors using RII
method. The study exposed that some delay factors are more critical than others in regards to the
geographical location and political issues from the government to the local contractors, consultants
and clients.
Moreover, the project delay is still happening and will continue to happen in the construction for
various known and unknown reasons such as unexpected factors, bankruptcy from client, changes in
design during the construction, political issue, sudden price fluctuation, severe weather conditions and
change of circumstances with projects manager in result of forcing him/her to leave before completing
the assigned job. However, time and cost overrun may not be prevented entirely but the evolving new
technology like BIM, new methods and past experience could be used to reduce the impact from
recognised risk factors, particularly in the undeveloped and developing countries. Finally, the paper
concludes that it is important to evaluate the critical delay factors and take necessary proactive actions
at early stage of project and before preparing the execution plan so that the project delay and the cost
overruns could be minimised in future construction projects. The top three critical factors found in
three different countries are shown below that could be useful when analysing the delay and cost
overrun in future projects.
Table 3
S.N. Australia Malaysia Ghana
1 Planning and scheduling
deficiencies,
Contractor’s improper
planning
Delay in payment
certificates
2 Methods of construction, Contractor’s poor site
management
Underestimating of
project cost,
3 Effective ways of
monitoring & feedback
Inadequate contractor
experience
Underestimating the
complexity of projects

jacem, Vol. 2, 2016 An Exploration of Causes for Delay and Cost Overruns in Construction Projects: Case Study of Australia, Malaysia & Ghana
The paper also recommends that following the most important factors must be considered and
analysed in depth about its impact on project time and cost prior or during the execution of a
construction project.
1. Proper planning and scheduling throughout the construction project.
2. Effective programming in order to keep track of each activity and its time of delivery.
3. Material price’s must be checked regularly before/after estimation and before purchase.
4. Estimation of cost and design must not be undertaken easily.
5. Use effective methods to visualise the overall project view such as (BIM technology).
6. Establishing appropriate communication with all parties (collaborative BIM).
7. Ensure labour and contractors are paid on time and ensure site health and safety.
8. Monitoring the work is essential but motivating the team is important for a successful project.
9. Weather condition should be checked and monitored in advance.
10. Regular meetings with subcontractors and suppliers.
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