ASSESSMENT OF FACTORS AFFECTING COST PERFORMANCE OF CONSTRUCTION PROJECT IN NIGERIA

Chapter one

Introduction

1.1. Background of the Study

Construction industry has complexity in its nature because it contains a large number of parties such as clients, contractors, consultants, stakeholders, shareholders, regulators and others. Construction projects in the Gaza Strip suffer from many problems and complex issues in performance, such as cost, time and safety (Shaban, 2008). Client satisfaction is therefore a fundamental issue for construction participants who must constantly seek to improve their performance if they are to survive in the global marketplace. However, client satisfaction has remained an elusive issue for a majority of construction professionals (Cheng, Fleming, Proverbs&Oduoza, 2005).

Due to the demand for built products from foreign investors and the growing economy, Vietnam’s construction industry, experience strong growth. While some of the construction projects are successfully executed, others faced difficulties (Bui &Ling, 2010). Despite the availability of various control techniques and project control software many construction projects still do not achieve their cost and time objectives (Oluwale& Sun, 2010).

Most third world countries face acute endemic housing problem that over the years has raised both national and international concerns. Habitat and World Bank, for example, fund many housing schemes worldwide in addressing the housing issue. Likewise, governmental and non-governmental institutions foster and orchestrateself-help campaigns directed at reducing inherent housing deficiency in these poor nations. However, a growing number of unfinished buildings in such countries seem to overshadow the efforts and thus pose many questions as to what is behind the failure in providing such a highly needed commodity. One may wonder whether such a failure has anything to do with architecture, attitudes and practices of the people or is it just a thing to be pegged on socio-economic platform of the society (Mirema & Mhando, 2005). Construction cost is one of the most important criteria of success of projects throughout the lifecycle of the project and is of high concern to those who are involved in the construction industry. In order to manage construction project successfully various procurement strategies have been introduced. In spite very rarely projects are completed within estimated budget (Abdullah, Aftab,Azis&Rahman, 2010). Maintaining steady cost projection on construction projects had been until recently an issue of serious concern, both to the client and project contractors. Cost deviation from initial cost plan, had been prevalent on construction sites (Amusan,n.d). Every year, large companies spend large sums on the research and development about the most optimum combination of production or the most optimum function and feature of their products and services. The impact of poor quality on the price of products and organization earnings and the amount of cost should be paid for high quality has raised many important issues affecting cost accounting, quality control, repairs and maintenance, supply chain, production management, stores, safety and health, education and improvement and so forth (Amin, 2011).

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