Make-or-break during production: shedding light on change-orders, rework and contractors margin in construction

A considerable amount of research has examined the cost performance of construction projects, yet there has been a paucity of studies that have examined the impact that client initiated change-orders and rework have on contractors. This paper seeks to add further clarity to this issue by replicating previous empirically-based research to establish the validity and reliability of the key issues influencing a contractor's cost performance. A total of 98 projects were used to examine the value of rework and change-orders and their influence on a contractor's margin. Only 65% of projects experienced a cost increase, though a mean rework cost of 0.39% of the contracted value was incurred. The difference between approved client change-orders and those by the contractor for subcontractors was 0.5% of the total costs incurred, which adversely impacted the organisation's profit. Margin losses may well have been higher as rework is seldom formally documented and reported

Towards methodological adventure in cost overrun research : linking process and product

The continued adoption of singular paradigms in the study of construction phenomena has elicited dialectical debates in scholarly literature. Calls have been made for more adventurous research methods, beyond the positivist versus interpretivist philosophical divide traditionally embraced by the industry. This study analyses the extensive scholarly debates, advancing and advocating philosophical positions to understand construction phenomena, and further narrows down the argument to within the specific domain of cost overrun research. A systematic and chronological literature review of the methodological/philosophical underpinnings of 41 papers was carried out. The papers were selected by following a staged exclusion criterion. The study outcome reveals that similar dialectical debates and methodological conservatism are still evident, with the predominance of mono-paradigm studies in the bulk of the empirical literature. Most of the empirical literature either provides interpretivist theoretical explanations from qualitative data or positivistically analyses quantitative data to provide technical explanations. To this end, mixed paradigm examples are spotlighted, demonstrating the relevance of linking process and product via methodological adventure in cost overrun research. Transcending the paradigmic divide is necessary to develop a more useful and contextually anchored view of practice, essential to mitigate and provide a holistic understanding of what drives cost overruns in public projects

Cost overruns in transportation infrastructure projects: Sowing the seeds for a probabilistic theory of causation

The authors would like to acknowledge the financial support provided by the Australian Research Council (DP160102882)