Reasons for the Delay and Cost Overrun in Residential Projects - 2017

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REASONS FOR THE DELAY AND COST
OVERRUN IN RESIDENTIAL PROJECTS
By:
Sankalp Swarnkar
Enrolment No.: A13559015190
MBA CPM
Batch: 2015 – 2017
FIELD APPLICATIONS OF PROJECT MANAGEMENT
YEAR 2017
RICS SCHOOL OF BUILT ENVIRONMENT
SCHOOL OF CONSTRUCTION
AMITY UNIVERSITY
NOIDA

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ACKNOWLEDGEMENT
It is an immense pleasure to place on the record our deep sense of gratitude and regards
to the Dean Emeritus Professor K.T RAVINDRAN and the members of management for
permitting us to do this project.
I express my heartiest gratitude to our beloved Associate Dean Director, School of
Construction Professor ANIL SAWHNEY FRICS who as an eminent researcher for his
overwhelming support and facilities provided to carry on this project work.
I wish to express my everlasting gratitude to my project guide Assistant Professor & MBA
Coordinator, School of Construction SHRUTINIWAS SHARMA who has rendered
unstinting guidance, Inspiration, constant encouragement and support which were
largely responsible for strengthening us always.
Sankalp Swarnkar
Signature

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Faculty Guide Approval Page
This is to certify that Sankalp Swarnkar has prepared the report for Fieldwork
Applications of Project Management report on “Reasons for the Delays and Cost Overrun
in Residential Projects” under my direction.
___________________
Faculty Guide Signature
(Shrutiniwas Sharma)
Assistant Professor & MBA Coordinator
School of Construction

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Table of Contents
Chapter 1. Introduction and Background……………...………………………………...01
1.1 Introduction………………………………………………………………………...01
1.2 Background………………………………………………………………………........01
1.3 Aim……………………………………………………………………………………02
1.4 Scope………………………………………………………………………………….02
1.5 Objectives…………………………………………………………………………......02
1.6 Problem Statement…………………………………………………………………....02
Chapter 2. Literature Review…………………………………………………………….04
2.1 Time Overrun…………………………………………………………………………05
2.2 Cost Overrun………………………………………………………………………….06
2.3 Types of Delays………………………………………………………………………06
Chapter3. Data Collection and Methodology……………………………………………08
3.1 Methodology………………………………………………………………………….08
3.2 Data Collection……………………………………………………………………….08
Chapter 4. Data Analysis…………………………………………………………………14
4.1 Comparison and Earned Value Analysis of the 3 Projects……………………………14
4.2 Total Identified Factors……………………………………………………………......17
4.3 Sorted data…………………………………………………………………………….21
4.4 Result………………………………………………………………………………….23
Chapter 5. Conclusion and Recommendations………………………………………….25
5.1 Conclusion…………………………………………………………………………….25
5.2 Recommendations…………………………………………………………………….27
References………………………………………………………………………………….30

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List of Tables
1. Site-1 Data………………………………………………………………………………………………………….14
2. Site-2 Data………………………………………………………………………………………………………….15
3. Site-3 Data………………………………………………………………………………………………………….16
4. Total no. of Identified Factors……………………………………………………………………………….….17
5. Sorted data according to high response…………………………………………………………………...21
6. Top Prominent reasons………………………………………………………………………………………….…23

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Chapter -1
Introduction and Background
1.1 Introduction
Construction industry plays important role in the economy of the country. It contributes
in the GDP and due to this reason, it is prominent for the economic development of the
developing countries. This industry has important market place because of the matter of
fact that construction industry obtains material and products from many other enterprises.
Complexity of the construction projects is increasing with the time, so the demand of the
construction managers is increasing to minimise the delay and cost overrun of
construction projects with superior quality. (Koushki et al. 2005)
Just completion of project is not the accomplishment for the client or owner, the success
of the project depends on various factors, the prominent factors are time overrun and cost
overrun with high quality of work and without compromising safety and health problems.
1.2 Background
Construction industry will expand as forecasted in the period (2016-2020), with the
infrastructure and residential projects. Many Government leading programs like – 100
Smart Cities, Atal Mission for Urban Rejuvenation and Transformation (AMRUT),
Housing for All and Make in India will be the main drivers for the growth.
The value of construction industry is probable to rise CAGR (Compound Annual Growth
Rate) of 5.67% in the predicted time and it is grown up from 2.90% from the period of
2011-15.
Construction industry is growing but there are some challenges also attached with it.
Some of the challenges are – Limited funding, slow improvisation in the policies and
weakness of the currency. These can be the barriers for the growth of the construction
industry.
Because of urbanisation, industrialisation and growth of population the demand of the
services of the construction is rising and the effort from the government will improve the

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India’s infrastructure and residential status, that will also support for the growth of the
construction industry. (ReportBuyer, 2016)
1.3 Aim
To find out the most prominent reasons for the delays and cost overrun in residential
projects.
1.4 Scope
This work will find out the most significant reasons of time and cost overrun for ongoing
residential projects, along with this, the study focuses to formulate recommendations for
improving construction performance. At the end of this work we can reach a conclusion
that what are common issues that are attributing to time and cost overrun in projects.
1.5 Objectives
I. Determining the main causes for delays and cost overrun of residential projects
founded on studies carried out earlier both in local and global context.
II. Establishing set of problems accountable for the delays and cost overruns in the
residential projects.
III. Reviewing residential projects and observing that, only those reasons are
responsible for delays and cost overruns in residential projects or any other
problem exist in the reasons.
IV. Establishing a set of common important causes for delays and cost overruns of
residential projects.
1.6 Problem Statement
Delays and Cost overruns is a thoughtful issue for the construction projects. Those are
the two parameters which decide whether the project is an accomplishment or a
disappointment.
Many residential projects are running far late as per schedule, rare projects are on time or
as per schedule. As per reports, builders and sponsors are also facing economic issues as
their projects are not running on estimated cost. These two problems have made it hard
for builders to deliver the projects on-time which is the resultant into growing account.

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Further these problems led to loss of trustworthiness of builders, clients are too scared
to go for current projects as it is not sure when they will get ownership of their house.

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Chapter – 2
Literature Review
• Factors affecting cost performance: evidence from Indian construction
projects
According to this paper, the vital success factors are the competency of the project
manager, support of the higher management, leadership skill and organisational skills
of the project manager, competence of owners and appropriate weather conditions.
Despite of this, the factors which are adversely affecting the cost execution of the
projects are: conflict between the participants of project, minimal knowledge, non-
cooperation between project participants, inappropriate weather conditions, delay in
timely decision, improper bidding process. As per this study, the main factor which
affects the cost performance is the coordination between the project team.
(Iyer & Jha 2005)
• Factors in influencing construction time and cost overruns on high-rise
projects in Indonesia
This paper states about the time and cost overruns of the residential project in
Indonesia in the two cities: Jakarta and Yogyakarta. As per the analysis, the main
cause of cost overrun is improper estimation of material, price hike of materials due
to inflation and complexity of projects. The prevalent delay causes are change in
design, poor productivity of labour and inadequacy in planning. They adopted the
factor analysis technique and analyse the relationship between the factors. However,
the main factor is the problem in construction management which is common in
growing countries. (Kaming et al. 1997)

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• Analysing factors affecting delays in Indian construction projects
This research paper states about the delay in construction projects in India. They firstly
identified the main factors which are impacting the time overrun. They adopted the
factor analysis and regression model methodology for the analysis and they identified
the various factors for the delay in construction projects – lack of top management
commitment, site management inefficiency, poor coordination at site, lack of planning,
lack of clarity in scope of project, improper communication. The regression model in
this study indicated the main factors of delay which are – poor productivity of labour,
slow decision of owner, mistakes which leads to rework. (Doloi et al. 2012)
• Causes of Cost Overrun in Construction
This research paper states about the cost overrun in the construction projects in India.
They used the Spearman rank order correlation method to identify the opinion of client,
consultant and contractor. In this research, they found some key factors which are
affecting the cost overrun in the construction projects. The analysis showed that – lack
in decision making, poorness in schedule management, price rise in materials and
equipment, poor management of contracts, delay in design, improper coordination
which leads to rework, poor estimation methodology, improper bidding process.
(Subramani et al. 2014)
2.1 Time Overruns
According to the Peter F. Kaming, time overrun is the extended time beyond the
completion dates. Time overrun impacts on the progress of the project. Generally, time
overrun is the result of the both external and internal causes in the construction project.
Time overrun also defined in another way i.e. difference between the estimated time of
the project and actual time which was taken for the completion of the project.
Formula
Time Delay (Overrun) = Net Project Duration – Duration of the Project
Here,
Net Duration = Start date of project – Approval date of project
(Kaming et al. 1997)

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2.2 Cost Overrun
It is defined as the surplus of the actual cost which is called as escalation of cost, increase
in cost and overrun of budget. It is also defined as Change in the amount of contract
divided by original amount of contract awarded.
Cost Overrun = Final Contract amount – Amount of Original contract
Amount of Original Contract
(Al-Najjar, 2008)
2.3 Types of Delays
• Excusable Delays
These are unexpected actions outside the control of anyone. These are fragmented
into compensable and non-compensable delay. If it is compensable, then contactor
is allowed for extra financial reimbursement and extended time for the project. If
it is non-compensable delay, then the contractor will receive the extended time
but additional money will not be given to the contractor.
• Concurrent Delays
These are the delays for which contractor and as well as owner are accountable.
Usually, if delays undistinguishably knotted, neither the owner will be responsible
for this nor the contractor will be responsible for the delays.
• Compensable Delays
These are the delays which are usually caused by the clients or the owners.
Generally, compensable delays are insufficient specification and the drawings, but
these delays could also occur due to the failure of client’s timely response for the
drawings, changes in the scope and materials and change in the schedule of work.

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• Critical Delays
These are the delays that disturb the growth, reimbursement and time. Non-
Critical delays does not affect the project completion date. They generally affect
the subsequent activities or actions which are not on the schedule’s critical path.
(Al-Najjar, 2008)

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Chapter - 3
Methodology and Data Collection
3.1 Methodology
By doing studies on delays and cost overruns in the projects and reasons or factors
accountable for them both globally and locally, will predefine an established a common
problem.
I will choose current residential projects and will visit those projects to see if they are
running successfully on time and in projected cost, if no I will inspect the reasons that
can cause delay and cost overrun in those chosen projects.
Then I will found a common set of most important problems that influences the two most
significant parameters i.e. time and cost of most of the current residential projects.
3.2 Data Collection
I went to the various residential construction sites to get the details about the project and
to meet the responsible personnel and circulated the survey questionnaire at the site for
my further analysis of field work project.
Following are the sites at which I went -
Site 1 - DLF Camellias, Gurugram
In Gurugram, I went to the DLF Camellias located on Golf Course road, DLF 5 on 21st
February 2017.
• It is one of the luxurious residential project in Delhi NCR.
• It has G+22 and G+38 4/5/6 BHK Apartments and Penthouses.
• Main Contractor – Leighton India Contractor Pvt. Ltd.
• Architect – Hafeez Contractor
• Interior Designer - Pierre-Yves Rochon

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There I met, Mr. Anurag Mishra (Engineer Construction), and he helped me in my project
and gave me his precious time to fill the questionnaire of this research project. They did
not share any information regarding the project, due to confidentiality.
Site 2 - Sun Valley Gwalior
In Gwalior, I went to the Sun Valley Residential project located on City Centre Extension,
Behind New Collectorate, Gwalior on 25/02/2017.
• Plot size is 10 Acre
• It has 18 Towers and 1104 Units
• It has G+13 2/3/4 BHK Apartments
• Client – Sun-life Infratech Gwalior
• Contract Type – Multiple contract
There I met, Mr. Ajit Singh (Project Manager), and he helped me in my project and gave
me his precious time to fill the questionnaire of this research project.
He shared some of the information with me related to the project delay and cost overrun
of the Sun Valley Gwalior, which is as follows:
Time Overrun
• It is behind the schedule.
• Total project duration is 3 years which was started in January 2014.
• It should be completed in December 2016 as per the estimated time.
• Till now it is physically 65 % completed.
Cost Overrun
• Total Contract Value – 600 Cr.
• Financially completed till date – 70% (Approx.)
He gave some reasons for the delay of the Sun Valley:
• No feasibility analysis
• Non-availability of material

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• Design Changes
• No proper Cashflow from client
• Lack of experienced staff
• Delay in decision of client
• No project management
• They are not monitoring the schedule
• Delay in project due to lack of training and improper coordination
Site 3 - Neoteric Group, Gwalior
I went to the NG Grande Project of the Neoteric Group and met with Mr. Rahul Yadav,
Site Engineer. The start date of the project was July1st 2014 and the completion date was
December 2016. The project is completed, little bit of finishing work is left, which will
complete in some days.
He also gave some major reasons for the delays and cost overrun in his organisation:
• Change orders of client during the execution
• Delay in mobilisation advance
• Poor site management
• Improper scheduling and planning
• Unavailability of some materials
• Less productive labour
• Breakdown of equipment
Site 4 -Amrapali Precast Infrastructure
This precast factory is situated at Kasna, Greater Noida, which is Asia’s largest precast
unit. The intention behind the establishment of this precast unit is to tackle the issues of
Time Delays in the construction projects. It is spread across 25 Acres with the production
capacity of 50 lac sq. ft. per year in India.
I visited to that factory because they cast the elements which are used in the building of
residential units like walls, columns, beams etc.

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On 4th
March 2017, I visited there and unfortunately the site was closed from 6 months
due to improper cash flow.
I took some contact details from the office, Mr. Mohd. Tariq (Design Manager) & Mr.
Raj Kumar (Admin. Manager) but intimation with them is not possible due to time
constraint.
Site 5 - Laureate Build well Pvt. Ltd.
Parx Laureate is the residential project which is situated in Sector – 108 Noida, has the
two types of units, 3 BHK Apartments and 4 BHK Apartments.
There, I met with two persons, Mr. C.L. Verma (Assistant General Manager) and Mr.
Hemant (Project Manager).
Time overrun
• It is behind the schedule.
• Total project duration is 5 years which was started in January 2012.
• It should be completed in December 2016 as per the estimated time.
• Till now it is physically 60 % completed.
Cost Overrun
• Total Contract Value – Rs.1400 Cr.
• Financially completed till date – 65% (Approx.)
They shared following reasons for the delay and cost overrun in of the project:
• Problem from the National Green Tribunal because it is a GRIHA Certified
project but they are not following the Environmental laws.
• No monitoring of the project.

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Site 6 - SAHA Infratech Pvt. Ltd.
I went to the Amadeus, the luxury apartments from the Saha Group. It has three 33 story
high towers with the total 320 units. These apartments are available in 2925 sq. ft.,
3425sq. ft. and 4500 sq. ft. sizes. Architect of this project is Hafeez Contractor.
In that project, I met with Mr. S.K. Pandey. He is the HR manager in the Saha Infratech
Pvt. Ltd. The project is running on time, as the start date of the project is January 2013
and possession date of the project is December 2018.
But he shared some major reasons for the delay of the residential construction projects –
• Poor project management
• Inflation
• Dispute on proposed land
• Delay due to regulatory clearances
• Sand, water and environmental regulation issues in NCR, which developers are
not able to meet.
Site 7 - Sikka Group
When I went to the site of Sikka Kapial Grand, I met with Mr. Y.K. Singh (GM Project).
This project of not only residential but it has the Mall, Commercial Complex (Shops and
Office Spaces). It has 4 towers with 33 floors in an area of 6.50 Acres. It is situated in
Sector-98 Noida. Project Start date is 2013 and it will complete in 2018.
• Total Project Cost is Rs.300 Cr.
• Project Duration is 5 years.
• Physically, it is 60% completed
• Financially, it is 62% completed
He also shared some reasons for the delay and cost overrun-
• Price rise of the materials (Mainly Steel and Cement)
• Funding problem from the client side.

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Site 8 - Saviram Engineering Consultants Pvt. Ltd, Noida
I also went for this firm because they are consultant and I want diversity in my project
work. So, I contacted to Mr. Girish Chandra Mishra. He is the Principal Consultant and
Director of Saviram Engineering Consultant Pvt. Ltd. He shared some major reasons for
the delay and cost overruns in residential projects.
• Improper feasibility study of the project
• Payment delays by the client
• Unrealistic Project schedule by PM team
• Poor project planning and scheduling
Site 9 – Kesar Constructions, Gwalior
I went to this Company in Gwalior on 25/02/2017 and contacted with the responsible
persons. I met with Mr. Sumer Singh Rathore, (Director) and Mr. Munish Saini (Manager
HR). They also shared some the reasons for the delay of their projects:
• Work suspension due to lack of cash flow
• Poor communication between client and contractor
• Design Changes
• Unexperienced staff

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Chapter - 4
Data Analysis
I had received total 20 responses out 35, which was floated through a questionnaire survey
at the different construction residential building sites. For the analysis of the data
responses based on the numerical value compared and Rank Order was calculated using
MS Excel tool, based on which the reasons for the delay and cost overrun were compiled
for every category. Further the graph for the prominent factors is plotted. I have also
compared and calculated cost data of three projects by the Earned Value Analysis.
4.1 Comparison and Earned Value Analysis of the 3 Projects
I have done earned value analysis for the 3 projects to see if they are running on
time and on budget.
Earned Value = % of Completed work X BAC
Planned Value = Planned % complete X BAC
Actual Cost = Actual Cost to date
Table 1. Site-1 Data
Site 1. Sun Valley
Project Start Date Jan. 2014
Project Completion
Date
Dec. 2016
Total Project Duration 3 Years
Total Contract Value 600 Cr.
Physically Completed 65%
Financially Completed 70%
Actual Cost 420 Cr.
Earned Value (% completion of project X Project Budget)
Earned Value 390 Cr.
Planned Value 600 Cr.

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CPI Earned Value / Actual Cost
0.928571429
SPI Earned Value / Planned Value
0.65
CPI < 1 Over Budget
SPI < 1 Behind Schedule
Site 2. Laureate
Buildwell
Project Start Date Jan. 2012
Project Completion Date Dec. 2016
Actual Cost 910 Cr.
0.923076923
0.6
CPI < 1 Over Budget

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Site 3. Sikka Group
Project Start Date 2013
Project Completion
Date
2018
Actual Cost 186 Cr.
0.967741935
0.9
CPI < 1 Over Budget
• The above calculations of EVM are the comparison of the three visited projects.
One is in Gwalior and other two projects are in Noida.
• The above data for the EVM was provided by the official persons of the company
but all the cost related data consists the approximate value.
• The result of the Earned Value Management analysis for the projects is that all the
three compared projects are Over Budgeted and Behind Schedule because for all
the three projects, the value of CPI & SPI is smaller than 1.

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4.2 Total Identified Factors
I had identified total 55 reasons for the delays and cost overruns in the construction of
residential buildings from the previous research papers. I also calculated the total
responses of each reason in each category in percentage. These are as follows:
Table 4. Total no. of Identified Factors.
Category Factors Not
prominent
Less
Prominent
Prominent Highly
Prominent
Always
Prominent
Client client's slow
decision making
process
20% 25% 40% 5% 10%
Delay in the site
possession
15% 25% 30% 20% 10%
The unsuitable
feasibility study
by the client can
cause impact
0% 15% 15% 30% 40%
Improper bidding
process of the
clients can impact
10% 10% 15% 35% 30%
Delays in the
payment by the
client can cause
impact
5% 15% 20% 25% 35%
Change in the
Scope &
constructive
changed orders by
clients
5% 5% 20% 30% 40%
Financial
availability of the
client
5% 10% 20% 25% 40%
Scope change by
the owner in
construction stage
20% 20% 30% 25% 5%

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Delay due to
approval of
drawings
20% 40% 15% 15% 10%
Lack of
communication
between owner &
other parties
10% 30% 35% 15% 10%
Delay in revision
and approval of
documents
45% 25% 15% 10% 5%
Suspension of
work
40% 45% 5% 10% 0%
Contractor Inadequate
experience of the
contractors
0% 10% 40% 30% 20%
Less efficiency in
supervision by the
contractors would
cause impact
10% 0% 10% 55% 25%
Use of old
technologies by
the contractor
25% 45% 20% 10% 0%
Lack of Planning,
scheduling &
monitoring
10% 20% 60% 0% 10%
Improper
construction
methods
actualized by
contractor
10% 5% 45% 30% 10%
slowdown in site
mobilization
15% 55% 15% 15% 0%
lack of site
Management &
Supervision by the
contractor
10% 65% 15% 10% 0%
Lack of
coordination &
communication
among the parties
10% 20% 35% 25% 10%

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problem due to
finance of project
by the contractor
45% 35% 10% 10% 0%
Less control on
sub-contractor
60% 30% 10% 0% 0%
Rework because
of errors
10% 20% 35% 25% 10%
Consultant
less experienced
staff in the PM
Team
5% 15% 55% 15% 10%
Less consultation
with the clients by
PM Organization
could cause
impact
10% 5% 15% 45% 25%
Lack of leadership
from the Project
Manager side
5% 10% 15% 50% 20%
Absence of on
Time Decisions &
Corrective Action
by PM Team
0% 20% 45% 20% 15%
Non-realistic
Schedule of the
project by PM
Organisation
0% 5% 15% 25% 55%
Lack of
commitment by
top management
in the PM
Organization
5% 10% 20% 40% 25%
Improper Planning
and Controlling of
projects by PM
Team
0% 5% 15% 60% 20%
Lack of
experience of
consultants
0% 0% 15% 70% 15%
Late in Inspection
and Testing by the
consultants
50% 25% 25% 0% 0%

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Inadequate
information flow
in team member
of the Consultants
40% 25% 30% 5% 0%
Design Inappropriate
collection of data
55% 25% 15% 5% 0%
Complexity in the
design of project
20% 75% 5% 0% 0%
Errors in the
design document
20% 75% 5% 0% 0%
Ambiguous detail
in Drawings
5% 10% 25% 50% 25%
Material Delays in the
Delivery of
material
10% 5% 40% 40% 5%
Change in the type
of material and
Specifications in
the Construction
20% 25% 45% 5% 5%
Delay in the
Procurement of
Materials
20% 25% 45% 5% 5%
Inflation in the
prices of material
5% 10% 15% 45% 25%
Quality related
Problems with the
material procured
40% 25% 30% 5% 0%
Suddenly increase
in the quantity
needed before
40% 25% 30% 5% 0%
Problems with
transportation of
material
40% 25% 30% 5% 0%
Labour Delay due to
payment
30% 35% 25% 10% 0%
Labour Shortage 10% 20% 40% 25% 15%
Strikes of labour 60% 25% 15% 0% 0%
Less skilled and
unqualified labour
15% 25% 40% 10% 10%

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safety & health
problem of
labours
65% 20% 10% 5% 0%
Equipment breakdown of
equipment
45% 30% 10% 10% 5%
less productivity
and inefficiency of
equipment
60% 30% 5% 5% 0%
External Government rules
& regulations
25% 35% 25% 15% 0%
In the obtaining
permissions
40% 30% 15% 5% 10%
4.3 Sorted Data
Now the data is sorted according to the high responses from the survey using the MS
Excel tool.
Table 5. Sorted data according to high response
Factors Highly
Prominent
Lack of experience of consultants 70%
Improper Planning and Controlling of projects by PM Team 60%
Less efficiency in supervision by the contractors would cause impact 55%
Lack of leadership from the Project Manager side 50%
Ambiguous detail in Drawings 50%
Less consultation with the clients by PM Organization could cause impact 45%
Inflation in the prices of material 45%
Lack of commitment by top management in the PM Organization 40%
Delays in the Delivery of material 40%
Improper bidding process of the clients can impact 35%
The unsuitable feasibility study by the client can cause impact 30%
Change in the Scope & constructive changed orders by clients 30%
Inadequate experience of the contractors 30%
Improper construction methods actualized by contractor 30%
Delays in the payment by the client can cause impact 25%
Financial availability of the client 25%
Scope change by the owner in construction stage 25%
Lack of coordination & communication among the parties 25%

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Rework because of errors 25%
Non-realistic Schedule of the project by PM Organisation 25%
Labour Shortage 25%
Delay in the site possession 20%
Absence of on Time Decisions & Corrective Action by PM Team 20%
Delay due to approval of drawings 15%
Lack of communication between owner & other parties 15%
slowdown in site mobilization 15%
less experienced staff in the PM Team 15%
Government rules & regulations 15%
Delay in revision and approval of documents 10%
Suspension of work 10%
Use of old technologies by the contractor 10%
lack of site Management & Supervision by the contractor 10%
problem due to finance of project by the contractor 10%
Delay due to payment 10%
Less skilled and unqualified labour 10%
breakdown of equipment 10%
client's slow decision making process 5%
Inadequate information flow in team member of the Consultants 5%
Inappropriate collection of data 5%
Change in the type of material and Specifications in the Construction 5%
Delay in the Procurement of Materials 5%
Quality related Problems with the material procured 5%
Suddenly increase in the quantity needed before 5%
Problems with transportation of material 5%
safety & health problem of labours 5%
less productivity and inefficiency of equipment 5%
In the obtaining permissions 5%
Lack of Planning, scheduling & monitoring 0%
Less control on sub-contractor 0%
Late in Inspection and Testing by the consultants 0%
Complexity in the design of project 0%
Errors in the design document 0%
Strikes of labour 0%

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4.4 Result
For the result of the survey I will consider top 20 reasons which are influencing the delays
and cost overrun in construction of residential projects.
Major Reasons for the delay and cost overrun in residential buildings determined through
survey are:
Table 6. Top Prominent reasons
Factors Highly
Prominent
Lack of experience of consultants 70%
Improper Planning and Controlling of projects by PM Team 60%
Less efficiency in supervision by the contractors would cause impact 55%
Lack of leadership from the Project Manager side 50%
Ambiguous detail in Drawings 50%
Less consultation with the clients by PM Organization could cause impact 45%
Inflation in the prices of material 45%
Lack of commitment by top management in the PM Organization 40%
Delays in the Delivery of material 40%
Improper bidding process of the clients can impact 35%
The unsuitable feasibility study by the client can cause impact 30%
Change in the Scope & constructive changed orders by clients 30%
Inadequate experience of the contractors 30%
Improper construction methods actualized by contractor 30%
Delays in the payment by the client can cause impact 25%
Financial availability of the client 25%
Scope change by the owner in construction stage 25%
Lack of coordination & communication among the parties 25%
Rework because of errors 25%
Non-realistic Schedule of the project by PM Organisation 25%
Labour Shortage 25%

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Fig. 1. Weightage of Prominent Reasons
Above chart shows the top highly prominent factors of time and cost overrun and their
responses of the conducted survey.
0% 10% 20% 30% 40% 50% 60% 70%
Lack of experience of consultants
Improper Planning and Controlling of…
Less efficiency in supervision by the…
Lack of leadership from the Project…
Ambiguous detail in Drawings
Less consultation with the clients by PM…
Inflation in the prices of material
Lack of commitment by top management…
Delays in the Delivery of material
Improper bidding process of the clients…
The unsuitable feasibility study by the…
Change in the Scope & constructive…
Inadequate experience of the contractors
Improper construction methods actualized…
Delays in the payment by the client can…
Financial availability of the client
Scope change by the owner in…
Lack of coordination & communication…
Rework because of errors
Non-realistic Schedule of the project by…
Labour Shortage
70%
60%
55%
50%
50%
45%
45%
40%
40%
35%
30%
30%
30%
30%
25%
25%
25%
25%
25%
25%
25%
HIGHLY PROMINENT FACTORS
ProminentFactors
Responses in %
add

25
Chapter - 5
Conclusion and Recommendations
5.1 Conclusion
This section includes the conclusion and recommendation which could help to find the
solution of time overrun and cost overrun of residential projects. This study investigated
some of the prominent reasons or factors which are responsible for the time and cost
overrun in the residential projects.
This investigation or study includes the following projects for the collection of data:
• DLF Camellias, Gurugram
• Sun Valley, Gwalior
• Neoteric Group, Gwalior
• Kesar Constructions, Gwalior
• Laureate Build well Pvt. Ltd.
• Saha Infratech Pvt. Ltd.
• Sikka Group
• Saviram Engineering Consultants Pvt. Ltd.
Approx. 20 responses were received from these sites and from that, this study reached to
the conclusion and key reasons for the time and cost overrun are identified after this
investigation.
• Client Related factors
Improper bidding process of the clients can impact the time overrun and cost overrun in
the residential project. It is ranked 1st
in the client related factors. If there will be the
unclear bidding process then it will lead to re-bid for the work which will be the cause for
time and cost overrun.

26
• Contractor Related factors
Less efficiency in supervision by the contractors would cause impact, it is one of the main
reason in the contractor’s related factors which is ranked 1st
among all contractor’s related
factors. If contractor is less efficient in supervision then the workforce will be less
productive and then workers will take more time to do same amount of work.
• Consultant Related Factors
Lack of Experience of Consultants and Improper planning by the PM Consultants are the
two main factors which are given highest weightage by the professionals. These are
ranked 1st
and 2nd
respectively. If there is less experienced consultant and improper
planning by the consultant then the work will be less efficient and can lead to delays and
cost overrun.
• Material Related Factors
Delay in the delivery of material is the most prominent reason which is ranked 1st
in this
category. As we all know, delay in the supply or delivery of material leads to the holding
of work. So, to mitigate this important factor, there should be a supply chain and
procurement strategy at the site.
• Labour Related Factors
Labour Shortage is the most prominent reason and is ranked number one in this category.
If there is shortage of labour in the industry then it will lead to the wage inflation. Workers
can demand more wages which is the reason for wage inflation.
• Equipment Related Factors
In this category, none of the respondent had given high weightage to the equipment
because construction industry has the fragmented nature and equipment related issues are
minimum because there are separate sub-contractors for the machines and equipment also
and most of the contractors like to hire the efficient equipment rather than to buy it.

27
• External Factors
This category had also not given the high weightage because these are factors which are
generally mitigated before the launch of the project and once mitigated, these factor does
not hamper the project in any stage and will not be the bottleneck for the project objective.
5.2 Recommendations
Following are the points which can be recommended for the mitigation of the prominent
factors of the time overrun and cost overrun in residential projects:
• Lack of experience of consultants
As we know that lack of experience of the consultants leads to the less efficiency in the
work and this can be the reason for the delay and cost overrun in the residential
construction projects.
To mitigate this factor in the practice, proper guidance should be given to them by the
experienced professional persons. Consultants are also recommended to hire well
qualified staff for the management of project in proper way and could be able to mitigate
any techno managerial problem. Consultant should be able to give appropriate
instructions to escape from the time and cost overruns.
• Improper Planning and Controlling of projects by PM Team
To avoid this type of mistake by the project management team or organisation they should
focus on the following two areas:
• Defining – Before the starting of the work, the Project Management Team
should spend the time to identify the objective of the project, scope of project,
risk of project & entire approach of the project.
• Planning – Project Management Organisation should make complete project
planning before the starting of the project. They should make the
comprehensive mapping of the work and ensure that resources for the project
are correctly assigned.

28
• Less efficiency in supervision by the contractors would cause impact
Contractors are advised for the monitoring of the quality to avoid the rework in the
construction activities. They are also recommended for the qualified supervisors and
engineers, so that they can follow the various techno managerial features in the project
work.
• Lack of leadership from the Project Manager side
PM Organisation should avoid the centralism decision because it leads to the delay of
work and due to this many problem can occur at the site.
• Ambiguous detail in Drawings
Due to unclear details in the shop drawings many time project suffers delays in work.
If it is identified during the planning stage then it puts the project work on the faster
track.
• Less consultation with the clients by PM Organization could cause impact
Project Management team should consult time to time with the clients to act on the
client’s requirement. If it is not happening in the project, then this reason could lead
to the rework in the project and due to rework delays happen.
• Inflation in the prices of material
Due to inflation in the price of material, many times construction work slows down
and results in time overrun and inflation results in cost overrun. to avoid this factor,
client or contractor is recommended to make the efficient procurement strategy and
make the buffer for the materials which are mostly required at the site.
• Lack of commitment by top management in the PM Organization
Many times, the upper management of the organisation transfers all the responsibility
of the project on the line managers and this is the big mistake of the top management
which could lead to errors in the project. To avoid this factor, top management of the
PMOs are recommended to commit with the responsibility of the project to avoid
errors and delays in the project.

29
• Delays in the Delivery of material
Delivery of material from the different portions of the country or the world could be
badly affected by the different incidents in pre-construction and construction stages.
It is recommended to choose for the items that are in-stock when it is possible or
procure the materials from the local suppliers.
• Miscellaneous
There are many more reasons or factors in the result and to mitigate those factors all
the parties should do the job effectively and efficiently and teams should be able to
understand the measures for these delays.
For mitigating the various factors, planning from the start to the end of the project
should be done. Presuming possible problems is an active way to mitigate these
factors so that the teams could take some quick and effective actions.

30
References
Doloi, H. et al., 2012. Analysing factors affecting delays in Indian construction projects.
International Journal of Project Management, 30(4), pp.479–489.
Iyer, K.C. & Jha, K.N., 2005. Factors affecting cost performance: evidence from Indian
construction projects. International Journal of Project Management, 23(4), pp.283–295.
Available at: http://linkinghub.elsevier.com/retrieve/pii/S0263786304001000.
Kaming, P.F. et al., 1997. Factors influencing construction time and cost overruns on
high-rise projects in Indonesia. Construction Management and Economics, 15(August
2011), pp.83–94.
Koushki, P.A., Al Rashid, K. & Kartam, N., 2005. Delays and cost increases in the
construction of private residential projects in Kuwait. Construction Management and
Economics, 23(3), pp.285–294.
Subramani, T., Sruthi, P.S. & Kavitha, M., 2014. Causes of Cost Overrun In
Construction. IOSR Journal of Engineering (IOSRJEN) www.iosrjen.org ISSN, 4(6),
pp.2250–3021.
Al-Najjar, J. M., 2008. Factors Influencing Time and Cost Overruns on Construction
Projects in the Gaza Strip, GAZA: The Islamic University of Gaza.
ReportBuyer, 2016. PR Newswire- a cision company. [Online]
Available at: http://www.prnewswire.com/news-releases/construction-in-india---key-
trends-and-opportunities-to-2020-300225713.html
[Accessed 25 March 2017].

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