Pub Date : 2021-09-27DOI: 10.1108/jfmpc-02-2021-0018
Mohammad Vahdatmanesh, A. Firouzi, J. Rotimi
Purpose Post-disaster housing reconstruction (PDHR) demands a considerable percentage of global property investment, yet the post-disaster environment presents intricate challenges to reconstruction financing for governments and at the same time, revenue uncertainty for private investors. The purpose of this study is to develop a methodology for tackling land shortage and the financial challenges of PDHR in the aftermath of a disaster. Design/methodology/approach This study developed a methodology based on a combined minimum revenue guarantee and maximum revenue cap model using a well-established real options analysis (ROA) for revenue risk sharing in PDHR projects and land readjustment (LR) for finance. The applicability of the purported model is demonstrated through an illustrative example. Findings The results show that flexibility in the options could increase the PDHR contractor’s risk profile by increasing the expected value of the contractor investment and reducing the probability of investment loss. On the other side, a cap on the contractor revenue stream would allow the government to benefit from any excess in revenue and would counterbalance the value of the option. Practical implications The framework proposed in this study could serve as a practical risk-revenue sharing in PDHR projects. Governments and policymakers could use the findings to enable the successful delivery of PDHR projects and consequently bring the quality of life of affected people to pre-disaster conditions. Originality/value This study can be considered as a first attempt toward the use of the Australian barrier style options structure, and the trinomial lattice valuation model in PDHR projects, which incorporates LR, public-private partnerships, governmental guarantees and PDHR concepts in one ROA-based framework.
{"title":"Real options analysis of revenue risk sharing in post-disaster housing reconstruction","authors":"Mohammad Vahdatmanesh, A. Firouzi, J. Rotimi","doi":"10.1108/jfmpc-02-2021-0018","DOIUrl":"https://doi.org/10.1108/jfmpc-02-2021-0018","url":null,"abstract":"Purpose Post-disaster housing reconstruction (PDHR) demands a considerable percentage of global property investment, yet the post-disaster environment presents intricate challenges to reconstruction financing for governments and at the same time, revenue uncertainty for private investors. The purpose of this study is to develop a methodology for tackling land shortage and the financial challenges of PDHR in the aftermath of a disaster. Design/methodology/approach This study developed a methodology based on a combined minimum revenue guarantee and maximum revenue cap model using a well-established real options analysis (ROA) for revenue risk sharing in PDHR projects and land readjustment (LR) for finance. The applicability of the purported model is demonstrated through an illustrative example. Findings The results show that flexibility in the options could increase the PDHR contractor’s risk profile by increasing the expected value of the contractor investment and reducing the probability of investment loss. On the other side, a cap on the contractor revenue stream would allow the government to benefit from any excess in revenue and would counterbalance the value of the option. Practical implications The framework proposed in this study could serve as a practical risk-revenue sharing in PDHR projects. Governments and policymakers could use the findings to enable the successful delivery of PDHR projects and consequently bring the quality of life of affected people to pre-disaster conditions. Originality/value This study can be considered as a first attempt toward the use of the Australian barrier style options structure, and the trinomial lattice valuation model in PDHR projects, which incorporates LR, public-private partnerships, governmental guarantees and PDHR concepts in one ROA-based framework.","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-09-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42437647","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-08-30DOI: 10.1108/jfmpc-01-2021-0002
O. Adedokun, I. Aje, O. Awodele, T. Egbelakin
Purpose The non-performance of construction projects in meeting the set objectives has continued to draw researchers worldwide. Despite this, little attention is accorded to public tertiary education building projects in Nigeria. Therefore, on this background, this study aims to assess the perceptions of stakeholders on the level of occurrence of risk factors in the public tertiary education building projects (TEBP) to enhance the performance of these projects. Design/methodology/approach The study adopted a quantitative method of data collection via a questionnaire survey. In total, 452 questionnaires were administered to the respondents comprising client representatives, consultants (quantity surveyors, architects, services and structural engineers and builders) and the contractor. The respondents were involved in the conception and execution of TEBP across five public tertiary education institutions in Ondo State, Nigeria. Of 452 questionnaires, 279 were retrieved and found suitable for analysis, indicating a 61.73% response rate. The reliability analysis for the research instrument was 0.965 via the Cronbach α test, indicating the high reliability of the instrument used for the data collection. Moreover, the clusters of risk factors also had reliability values that ranged between 0.719 and 0.875. Findings The study found inflation, delayed payments in contracts, high competition bids, delay in work progress and occurrence of variations are the most frequently occurring risk factors in public TEBP. By contrast, difficulty to access the site, environmental factors and pollution were found to be low-weighted risks with the least likelihood of occurrence. The results of this study indicated the existence of significant differences in some of the risk factors in terms of the level of risk occurrence in TEBP. The risk factors were eventually clustered into eight major groups for TEBP. The post hoc comparisons using the least significant difference test also indicated differences between the contractors and consultants in the ranking of risks occurrence in TEBP, but no significant differences between clients/contractors and clients/consultants. Research limitations/implications The findings in this study are limited to the public TEBP procured via competitive tendering; therefore, the results might not be applicable when other procurement methods are being considered. Besides, the study classified the project participants based on organizations and not on the different ownership status of the projects, such as federal or state government-owned TEBP. However, the literature shows that likelihood of risk occurrence could vary due to the degree of project ownership. Practical implications The information provided with respect to the most frequently occurring risk factors would enhance the performance of public TEBP. Originality/value This study contributes to the existing body of knowledge on the subject within a previously unexplored contex
{"title":"Are the public tertiary education building projects devoid of risks in the Nigerian construction context?","authors":"O. Adedokun, I. Aje, O. Awodele, T. Egbelakin","doi":"10.1108/jfmpc-01-2021-0002","DOIUrl":"https://doi.org/10.1108/jfmpc-01-2021-0002","url":null,"abstract":"\u0000Purpose\u0000The non-performance of construction projects in meeting the set objectives has continued to draw researchers worldwide. Despite this, little attention is accorded to public tertiary education building projects in Nigeria. Therefore, on this background, this study aims to assess the perceptions of stakeholders on the level of occurrence of risk factors in the public tertiary education building projects (TEBP) to enhance the performance of these projects.\u0000\u0000\u0000Design/methodology/approach\u0000The study adopted a quantitative method of data collection via a questionnaire survey. In total, 452 questionnaires were administered to the respondents comprising client representatives, consultants (quantity surveyors, architects, services and structural engineers and builders) and the contractor. The respondents were involved in the conception and execution of TEBP across five public tertiary education institutions in Ondo State, Nigeria. Of 452 questionnaires, 279 were retrieved and found suitable for analysis, indicating a 61.73% response rate. The reliability analysis for the research instrument was 0.965 via the Cronbach α test, indicating the high reliability of the instrument used for the data collection. Moreover, the clusters of risk factors also had reliability values that ranged between 0.719 and 0.875.\u0000\u0000\u0000Findings\u0000The study found inflation, delayed payments in contracts, high competition bids, delay in work progress and occurrence of variations are the most frequently occurring risk factors in public TEBP. By contrast, difficulty to access the site, environmental factors and pollution were found to be low-weighted risks with the least likelihood of occurrence. The results of this study indicated the existence of significant differences in some of the risk factors in terms of the level of risk occurrence in TEBP. The risk factors were eventually clustered into eight major groups for TEBP. The post hoc comparisons using the least significant difference test also indicated differences between the contractors and consultants in the ranking of risks occurrence in TEBP, but no significant differences between clients/contractors and clients/consultants.\u0000\u0000\u0000Research limitations/implications\u0000The findings in this study are limited to the public TEBP procured via competitive tendering; therefore, the results might not be applicable when other procurement methods are being considered. Besides, the study classified the project participants based on organizations and not on the different ownership status of the projects, such as federal or state government-owned TEBP. However, the literature shows that likelihood of risk occurrence could vary due to the degree of project ownership.\u0000\u0000\u0000Practical implications\u0000The information provided with respect to the most frequently occurring risk factors would enhance the performance of public TEBP.\u0000\u0000\u0000Originality/value\u0000This study contributes to the existing body of knowledge on the subject within a previously unexplored contex","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42870199","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-08-23DOI: 10.1108/jfmpc-07-2019-0065
M. Rohman
Purpose This study aims to investigate the government’s role in the development of toll road projects that adopt public-private partnership (PPP) schemes in Indonesia. In addition to investigating its role, this study also attempts to quantitatively assess its performance as the use of quantitative analysis in this area is still fairly limited. The analysis was developed from the perspectives of two main stakeholders involved: government and private sectors. The findings of this study are expected to help both government and private sectors to better understand the government’s role as well as its performance in PPP toll road projects in Indonesia. Design/methodology/approach The data was analysed by using statistical methods. Following the identification of the government’s role in PPP toll road projects from the literature, a preliminary survey involving 12 highway construction experts was conducted to verify the initial findings from the literature review. Subsequently, the authors conducted a survey of 146 respondents from both government and private sectors. To analyse the collected data, both descriptive and inferential statistics were used, which include analysis of means, analysis of reliability, as well as independent T-test. T-test was used to examine differences in perception between the two groups. Findings In total, 12 criteria from the literature were used to assess the government’s role and its performance in PPP toll road projects in Indonesia. Based on the analysis, the authors find that the government’s role in the development of PPP toll road projects can be considered moderate in its performance. In this respect, the author argue that, instead of focusing on meeting all the criteria, it would be better for government to focus on meeting only a number of them, which include realizing smooth land acquisition, selecting appropriate concessionaire, offering a solution to community protests over environmental issues, providing substantial government support, providing supervision, enforcing the law and eradicating corruption. The results of this study provide valuable information for international parties aiming to participate in PPP toll road projects in Indonesia, considering this country has been offering a wide opportunity for private sectors to be involved in developing infrastructure. Meanwhile, for the host government, the findings can be used as the basis for conducting improvements to attract private sectors’ involvement and to achieve more successful upcoming PPP toll road projects in Indonesia. Research limitations/implications The findings of this study might provide valuable information for the host government to evaluate its role and performance to achieve more successful PPP toll road projects in the future. Rather than focusing on all attributes, the improvements can be made by focusing only on the critical ones: those ranked high on the importance and low on its performance. In addition, this finding can als
{"title":"Assessment of the government’s role performance in public-private partnership (PPP) toll road projects in Indonesia","authors":"M. Rohman","doi":"10.1108/jfmpc-07-2019-0065","DOIUrl":"https://doi.org/10.1108/jfmpc-07-2019-0065","url":null,"abstract":"\u0000Purpose\u0000This study aims to investigate the government’s role in the development of toll road projects that adopt public-private partnership (PPP) schemes in Indonesia. In addition to investigating its role, this study also attempts to quantitatively assess its performance as the use of quantitative analysis in this area is still fairly limited. The analysis was developed from the perspectives of two main stakeholders involved: government and private sectors. The findings of this study are expected to help both government and private sectors to better understand the government’s role as well as its performance in PPP toll road projects in Indonesia.\u0000\u0000\u0000Design/methodology/approach\u0000The data was analysed by using statistical methods. Following the identification of the government’s role in PPP toll road projects from the literature, a preliminary survey involving 12 highway construction experts was conducted to verify the initial findings from the literature review. Subsequently, the authors conducted a survey of 146 respondents from both government and private sectors. To analyse the collected data, both descriptive and inferential statistics were used, which include analysis of means, analysis of reliability, as well as independent T-test. T-test was used to examine differences in perception between the two groups.\u0000\u0000\u0000Findings\u0000In total, 12 criteria from the literature were used to assess the government’s role and its performance in PPP toll road projects in Indonesia. Based on the analysis, the authors find that the government’s role in the development of PPP toll road projects can be considered moderate in its performance. In this respect, the author argue that, instead of focusing on meeting all the criteria, it would be better for government to focus on meeting only a number of them, which include realizing smooth land acquisition, selecting appropriate concessionaire, offering a solution to community protests over environmental issues, providing substantial government support, providing supervision, enforcing the law and eradicating corruption. The results of this study provide valuable information for international parties aiming to participate in PPP toll road projects in Indonesia, considering this country has been offering a wide opportunity for private sectors to be involved in developing infrastructure. Meanwhile, for the host government, the findings can be used as the basis for conducting improvements to attract private sectors’ involvement and to achieve more successful upcoming PPP toll road projects in Indonesia.\u0000\u0000\u0000Research limitations/implications\u0000The findings of this study might provide valuable information for the host government to evaluate its role and performance to achieve more successful PPP toll road projects in the future. Rather than focusing on all attributes, the improvements can be made by focusing only on the critical ones: those ranked high on the importance and low on its performance. In addition, this finding can als","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-08-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45956568","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-08-19DOI: 10.1108/jfmpc-05-2020-0038
E. Adinyira, K. Agyekum, P. Manu, Abdul–Majeed Mahamadu, P. Olomolaiye
Purpose Multilateral aid agencies generate most of their funds from taxpayers, and therefore, it is necessary to ensure that recipients or borrowers use the funds for the intended purposes. The World Bank is one of the major multilateral aid agencies that fund infrastructure projects in developing countries. Like other multilateral aid agencies, the World Bank uses oversight instruments/auditing tools to manage procurement risk on their funded projects. However, empirical insight about the effectiveness of these auditing tools is limited. This paper aims to assess the effectiveness of one of such multilateral aid agencies’ auditing tools (i.e. World Bank’s procurement post review [PPR]) in procurement risk mitigation on funded projects in a developing country context. Design/methodology/approach The study is based on secondary data obtained from the World Bank PPR reports carried out in the 2014, 2015 and 2016 financial years. Five projects with the highest loan amounts and five with the lowest loan amounts for the three-year period were selected from the 24 active World Bank projects during the time of the study. A purposive sampling technique was used to select a representative sample from a list of contracts under the 10 projects. Findings The results of the analysis showed a clear decline in the number of both major and minor deviations over the three-year period while an increase in the number of contracts with “No Deviation”. The study therefore concludes that procurement risk experienced a decline amongst the World Bank projects in Ghana where post reviews were carried out on yearly basis. Originality/value The study identifies the need for more frequent PPR and makes a case for the need to investigate whether PPR is a superior auditing tool compared to the other tools.
{"title":"Lessening procurement deviations using procurement post reviews: evidence from Ghana","authors":"E. Adinyira, K. Agyekum, P. Manu, Abdul–Majeed Mahamadu, P. Olomolaiye","doi":"10.1108/jfmpc-05-2020-0038","DOIUrl":"https://doi.org/10.1108/jfmpc-05-2020-0038","url":null,"abstract":"\u0000Purpose\u0000Multilateral aid agencies generate most of their funds from taxpayers, and therefore, it is necessary to ensure that recipients or borrowers use the funds for the intended purposes. The World Bank is one of the major multilateral aid agencies that fund infrastructure projects in developing countries. Like other multilateral aid agencies, the World Bank uses oversight instruments/auditing tools to manage procurement risk on their funded projects. However, empirical insight about the effectiveness of these auditing tools is limited. This paper aims to assess the effectiveness of one of such multilateral aid agencies’ auditing tools (i.e. World Bank’s procurement post review [PPR]) in procurement risk mitigation on funded projects in a developing country context.\u0000\u0000\u0000Design/methodology/approach\u0000The study is based on secondary data obtained from the World Bank PPR reports carried out in the 2014, 2015 and 2016 financial years. Five projects with the highest loan amounts and five with the lowest loan amounts for the three-year period were selected from the 24 active World Bank projects during the time of the study. A purposive sampling technique was used to select a representative sample from a list of contracts under the 10 projects.\u0000\u0000\u0000Findings\u0000The results of the analysis showed a clear decline in the number of both major and minor deviations over the three-year period while an increase in the number of contracts with “No Deviation”. The study therefore concludes that procurement risk experienced a decline amongst the World Bank projects in Ghana where post reviews were carried out on yearly basis.\u0000\u0000\u0000Originality/value\u0000The study identifies the need for more frequent PPR and makes a case for the need to investigate whether PPR is a superior auditing tool compared to the other tools.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-08-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45890639","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-08-02DOI: 10.1108/jfmpc-07-2020-0051
A. Mahmud, S. Ogunlana, W. T. Hong
Purpose Empirical evidence suggests that many triggers influence poor cost performance in highway projects, whereas previous studies about the cost overrun triggers stem from a positivist standpoint supported by conventional statistical techniques, thus disregarding the sophisticated interactions and overall dynamics of the triggers. This study contends for a paradigm shift in investigating and understanding cost overrun triggers by adopting a holistic perspective through the lens of system thinking. This study aims to contend for a paradigm shift in investigating and understanding cost overrun triggers by adopting a holistic perspective through the lens of system thinking. Design/methodology/approach Semi-structured interviews with industry stakeholders in Nigeria were conducted buttressed by textual data from literature sources and project documents. Data analysis based on a developed data compatible coding framework and causal relations from textual data sources was used to develop a causal loop diagram depicting the interactions of the triggers which were validated by experts. Findings The analysis of the causal loop diagrams (CLDs) allowed identification of action points used to suggest changes for improved cost-effective highway project delivery. Among the suggested interventions are ensuring the provision of adequate funding prior to contract award will result in timely delivery of projects and indeed delivering key projects at the contractual agreed budget. This can be achieved through ensuring strict adherence to the provisions of Section 4 (2) (b) of the Nigerian Public Procurement Act, 2007 which stipulates that no contract should be awarded if funds are not available from the onset. Research limitations/implications The study was limited to only highway infrastructure projects in Nigeria and as such caution must be taken before using the outcome of the study to other context within Nigeria and beyond. Practical implications From a practical point of view, the causal model demonstrates that this study is capable of being used to make pragmatic decisions regarding policy leverages about improving cost performance in highway projects provision in the Nigerian highway infrastructure sector of the construction industry. Moreover, it will aid a clear understanding of the key influencing triggers of cost overrun by the relevant stakeholders within the highway sector of the industry. Originality/value The hybrid-based approach applied in the development of CLDs in this study is expected to provide new insight into understanding the linkages, interactions, feedbacks and processes among the key cost overrun triggers and suggesting leverages for cost performance improvement within the philosophy of system thinking.
{"title":"Understanding the dynamics of cost overrun triggers in highway infrastructure projects in Nigeria: a systems thinking modelling approach","authors":"A. Mahmud, S. Ogunlana, W. T. Hong","doi":"10.1108/jfmpc-07-2020-0051","DOIUrl":"https://doi.org/10.1108/jfmpc-07-2020-0051","url":null,"abstract":"\u0000Purpose\u0000Empirical evidence suggests that many triggers influence poor cost performance in highway projects, whereas previous studies about the cost overrun triggers stem from a positivist standpoint supported by conventional statistical techniques, thus disregarding the sophisticated interactions and overall dynamics of the triggers. This study contends for a paradigm shift in investigating and understanding cost overrun triggers by adopting a holistic perspective through the lens of system thinking. This study aims to contend for a paradigm shift in investigating and understanding cost overrun triggers by adopting a holistic perspective through the lens of system thinking.\u0000\u0000\u0000Design/methodology/approach\u0000Semi-structured interviews with industry stakeholders in Nigeria were conducted buttressed by textual data from literature sources and project documents. Data analysis based on a developed data compatible coding framework and causal relations from textual data sources was used to develop a causal loop diagram depicting the interactions of the triggers which were validated by experts.\u0000\u0000\u0000Findings\u0000The analysis of the causal loop diagrams (CLDs) allowed identification of action points used to suggest changes for improved cost-effective highway project delivery. Among the suggested interventions are ensuring the provision of adequate funding prior to contract award will result in timely delivery of projects and indeed delivering key projects at the contractual agreed budget. This can be achieved through ensuring strict adherence to the provisions of Section 4 (2) (b) of the Nigerian Public Procurement Act, 2007 which stipulates that no contract should be awarded if funds are not available from the onset.\u0000\u0000\u0000Research limitations/implications\u0000The study was limited to only highway infrastructure projects in Nigeria and as such caution must be taken before using the outcome of the study to other context within Nigeria and beyond.\u0000\u0000\u0000Practical implications\u0000From a practical point of view, the causal model demonstrates that this study is capable of being used to make pragmatic decisions regarding policy leverages about improving cost performance in highway projects provision in the Nigerian highway infrastructure sector of the construction industry. Moreover, it will aid a clear understanding of the key influencing triggers of cost overrun by the relevant stakeholders within the highway sector of the industry.\u0000\u0000\u0000Originality/value\u0000The hybrid-based approach applied in the development of CLDs in this study is expected to provide new insight into understanding the linkages, interactions, feedbacks and processes among the key cost overrun triggers and suggesting leverages for cost performance improvement within the philosophy of system thinking.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-08-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49189599","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-07-05DOI: 10.1108/JFMPC-03-2020-0018
S. Deep, V. Bhoola, Saumya Verma, U. Ranasinghe
Purpose Construction projects in the real estate sector are important for a nation’s economic growth. However, owing to several constraints and stereotypes, the construction industry is suffering from major capital losses. A review of recent literature revealed that risks occurring in real estate construction projects (RECPs) carried out in developing economies can be divided into four categories, i.e. financial risks, design risks, execution risks and sociopolitical risks. This study aims to identify the critical factors that lead to these risk categories and develop a control structure for RECPs. Design/methodology/approach A quantitative method, i.e. a questionnaire-based survey, was used for this study. Using a random sampling technique the questionnaire was distributed to selected, highly experienced project managers. To determine whether the factors identified as part of the literature review strongly influence the categories, the factor analysis of the observations was performed. Findings The observations made in this study lead to the identification of six critical risk causing factors, i.e. lack of efficient planning, execution constraints, external constraints, client-induced constraints, project constraints and partner experience. The observations indicated a lack of knowledge of project management, organizational culture and a claims redressal mechanism in RECPs. Also, this study recommends a blockchain-based control structure to control the occurrence of the risk causing factors identified. Originality/value This study recommends a blockchain-based control structure for controlling the risks occurring.
{"title":"Identifying the risk factors in real estate construction projects: an analytical study to propose a control structure for decision-making","authors":"S. Deep, V. Bhoola, Saumya Verma, U. Ranasinghe","doi":"10.1108/JFMPC-03-2020-0018","DOIUrl":"https://doi.org/10.1108/JFMPC-03-2020-0018","url":null,"abstract":"\u0000Purpose\u0000Construction projects in the real estate sector are important for a nation’s economic growth. However, owing to several constraints and stereotypes, the construction industry is suffering from major capital losses. A review of recent literature revealed that risks occurring in real estate construction projects (RECPs) carried out in developing economies can be divided into four categories, i.e. financial risks, design risks, execution risks and sociopolitical risks. This study aims to identify the critical factors that lead to these risk categories and develop a control structure for RECPs.\u0000\u0000\u0000Design/methodology/approach\u0000A quantitative method, i.e. a questionnaire-based survey, was used for this study. Using a random sampling technique the questionnaire was distributed to selected, highly experienced project managers. To determine whether the factors identified as part of the literature review strongly influence the categories, the factor analysis of the observations was performed.\u0000\u0000\u0000Findings\u0000The observations made in this study lead to the identification of six critical risk causing factors, i.e. lack of efficient planning, execution constraints, external constraints, client-induced constraints, project constraints and partner experience. The observations indicated a lack of knowledge of project management, organizational culture and a claims redressal mechanism in RECPs. Also, this study recommends a blockchain-based control structure to control the occurrence of the risk causing factors identified.\u0000\u0000\u0000Originality/value\u0000This study recommends a blockchain-based control structure for controlling the risks occurring.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":"1 1","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-07-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41362198","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-06-18DOI: 10.1108/jfmpc-06-2020-0044
A. Ojo, O. Ogunsina, D. Ogunsemi
Purpose The purpose of the work presented here is to assess the cost management practices of civil engineering organisations in Nigeria, with an overall aim of developing a generic cost management process map. The first objective is to compare existing frameworks theoretically to highlight their strengths and weaknesses. The second objective is to use the findings of the first objective to assess or benchmark the developed process map obtained from the multiple cases. The third objective is to compare the generic process map with the traditional building cost management process map to evaluate the strengths and shortcomings of the generic process map, which resulted in conclusions and recommendations made at the end of the research. Design/methodology/approach Data for the work was collected via semi-structured interviews, review of literature and official documents of the civil engineering organisations visited. To achieve the stated objectives, comparative analysis technique was used to compare existing frameworks on cost management to obtain the basis to benchmark the generic process map. The single case narrative technique was used to present each case; and the cross-case synthesis technique was used to present the multiple cases on each cost management process examined. Then, process maps were deployed to represent the homogeneous sets of civil engineering organisations, out of which the generic process map was developed. Comparative analysis was again deployed to compare the generic process map with the traditional building process map of cost management practice to evaluate the findings. Findings It was found out that the generic civil engineering process map is not as detailed and effective as the building process map in providing best value for money, accurate early cost estimates, accurate cost certainty and post-contract cost control. Originality/value This research study provides an industrial impetus to push for the involvement of more quantity surveyors (QS) as cost management process owners in the procurement of civil engineering projects in Nigeria, hence encouraging government’s efforts in the enforcement of more accurate project cost estimates and promoting the QS’s project-specific advice on capital, operational, maintenance and life cycle costs.
{"title":"Assessment of cost management practices of civil engineering (project procurement) organisations in Ondo State, Nigeria","authors":"A. Ojo, O. Ogunsina, D. Ogunsemi","doi":"10.1108/jfmpc-06-2020-0044","DOIUrl":"https://doi.org/10.1108/jfmpc-06-2020-0044","url":null,"abstract":"\u0000Purpose\u0000The purpose of the work presented here is to assess the cost management practices of civil engineering organisations in Nigeria, with an overall aim of developing a generic cost management process map. The first objective is to compare existing frameworks theoretically to highlight their strengths and weaknesses. The second objective is to use the findings of the first objective to assess or benchmark the developed process map obtained from the multiple cases. The third objective is to compare the generic process map with the traditional building cost management process map to evaluate the strengths and shortcomings of the generic process map, which resulted in conclusions and recommendations made at the end of the research.\u0000\u0000\u0000Design/methodology/approach\u0000Data for the work was collected via semi-structured interviews, review of literature and official documents of the civil engineering organisations visited. To achieve the stated objectives, comparative analysis technique was used to compare existing frameworks on cost management to obtain the basis to benchmark the generic process map. The single case narrative technique was used to present each case; and the cross-case synthesis technique was used to present the multiple cases on each cost management process examined. Then, process maps were deployed to represent the homogeneous sets of civil engineering organisations, out of which the generic process map was developed. Comparative analysis was again deployed to compare the generic process map with the traditional building process map of cost management practice to evaluate the findings.\u0000\u0000\u0000Findings\u0000It was found out that the generic civil engineering process map is not as detailed and effective as the building process map in providing best value for money, accurate early cost estimates, accurate cost certainty and post-contract cost control.\u0000\u0000\u0000Originality/value\u0000This research study provides an industrial impetus to push for the involvement of more quantity surveyors (QS) as cost management process owners in the procurement of civil engineering projects in Nigeria, hence encouraging government’s efforts in the enforcement of more accurate project cost estimates and promoting the QS’s project-specific advice on capital, operational, maintenance and life cycle costs.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-06-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45460054","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-05-05DOI: 10.1108/JFMPC-08-2020-0054
Gholamreza Dehdasht, M. S. Ferwati, N. Abidin, Michael Olubukola Oyedeji
Purpose The transition of Malaysia from a developing country to a developed country was considered in vision 2020, whereby an average construction contribution of 6.0% in growth domestic product (GDP) per annum was required. Despite this importance, still, the Malaysian construction industry has not reached the target yet. Understanding the weakness and strength of this industry can be an effective way to help the policymakers in selecting the best strategy in the promotion of the Malaysian construction industry in GDP growth. Hence, the purpose of this paper is to present an overview of the current issues and challenges faced by the contribution of the Malaysian construction industry in GDP growth. Design/methodology/approach To achieve this objective, all the latest statistical data presented by the Department of Statistic and Construction Industry Development Board in Malaysia until March 2018 being collected and interpreted. Furthermore, through the literature review, the most significant challenges encountered by the Malaysian construction industry identified, compared and presented. Findings The results highlight that the contribution of Malaysian construction into GDP is increasing with a gentle slope. Nonetheless, the Malaysian construction industry has a high impact on the employment rate. More investment in the construction sector is required to meet an average of 6% contribution in GDP. Also, to be able to seize new opportunities in the global construction market, more exerted efforts have to overcome the challenges faced by this industry. Practical implications This study offers practical implications to policy and decision makers in the Malaysian construction industry. Despite the constant growth of the Malaysian construction industry in recent years, there is a need for more investments and overcome to challenges to encounter an average of 6% contribution in GDP. This study provides an overview and insights to investors, stockholders and managers to formulate a long-term plan promoting the efficiency of the Malaysian construction industry. Originality/value This study through explaining, comparing and interpreting the real statistical data, through the tables, figures and graphs, simplified the understanding of the weakness and strength of the Malaysian construction industry.
{"title":"Trends of construction industry in Malaysia and its emerging challenges","authors":"Gholamreza Dehdasht, M. S. Ferwati, N. Abidin, Michael Olubukola Oyedeji","doi":"10.1108/JFMPC-08-2020-0054","DOIUrl":"https://doi.org/10.1108/JFMPC-08-2020-0054","url":null,"abstract":"\u0000Purpose\u0000The transition of Malaysia from a developing country to a developed country was considered in vision 2020, whereby an average construction contribution of 6.0% in growth domestic product (GDP) per annum was required. Despite this importance, still, the Malaysian construction industry has not reached the target yet. Understanding the weakness and strength of this industry can be an effective way to help the policymakers in selecting the best strategy in the promotion of the Malaysian construction industry in GDP growth. Hence, the purpose of this paper is to present an overview of the current issues and challenges faced by the contribution of the Malaysian construction industry in GDP growth.\u0000\u0000\u0000Design/methodology/approach\u0000To achieve this objective, all the latest statistical data presented by the Department of Statistic and Construction Industry Development Board in Malaysia until March 2018 being collected and interpreted. Furthermore, through the literature review, the most significant challenges encountered by the Malaysian construction industry identified, compared and presented.\u0000\u0000\u0000Findings\u0000The results highlight that the contribution of Malaysian construction into GDP is increasing with a gentle slope. Nonetheless, the Malaysian construction industry has a high impact on the employment rate. More investment in the construction sector is required to meet an average of 6% contribution in GDP. Also, to be able to seize new opportunities in the global construction market, more exerted efforts have to overcome the challenges faced by this industry.\u0000\u0000\u0000Practical implications\u0000This study offers practical implications to policy and decision makers in the Malaysian construction industry. Despite the constant growth of the Malaysian construction industry in recent years, there is a need for more investments and overcome to challenges to encounter an average of 6% contribution in GDP. This study provides an overview and insights to investors, stockholders and managers to formulate a long-term plan promoting the efficiency of the Malaysian construction industry.\u0000\u0000\u0000Originality/value\u0000This study through explaining, comparing and interpreting the real statistical data, through the tables, figures and graphs, simplified the understanding of the weakness and strength of the Malaysian construction industry.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-05-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49025609","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-04-08DOI: 10.1108/JFMPC-12-2019-0089
D. Owusu-Manu, E. Amo-Asamoah, F. A. Ghansah, George Asumadu
Purpose Kumasi Metropolis, the second-largest city in Ghana is known to be bewildered with challenges relating to waste management. As a means of solving the waste management challenge, several suggestions are often made for the establishment of a waste-to-energy plant to manage the disposal of waste and generation of income. There have been no studies conducted to determine how economically viable such plants will be. This study aims to examine the economic viability of waste-to-energy generation in the Kumasi Metropolis to find out how economically viable such an approach will be. Design/methodology/approach To achieve this, a simple debt-equity ratio business model based on discounted cash flow technique was applied to estimate the internal rate of returns (IRR) as a measure of the economic viability and profitability of a modelled 50 MWH waste-energy generation plant in the Kumasi Metropolis. The analysis was performed using the RetScreen Expert Software. Findings The results show that the IRR and benefits cost ratio of the facility were 36% and 5.8%, respectively, indicating high levels of profitability and economic viability. The study concludes that waste-to-energy generation will be an economically viable venture in the Kumasi Metropolis. Practical implications It is, however, important for users of the findings of this study to take caution of the fact that the various assumptions although based on current knowledge and expert opinion may vary with time; therefore, the sensitive analysis on price and costs should always be considered. Practically, this study will contribute to solving the waste management situation in most cities, as well as generating revenue and helping close the energy deficit most developing countries are grabbling with. Originality/value The unique contribution of the study to knowledge is that it has professed an alternative analytical and methodological approach to measuring the financial viability of waste-to-energy plants in situations where there is none in the geographical jurisdiction of the proposed project.
{"title":"An analysis of the economic viability of waste-to-energy generation in the Kumasi metropolis of Ghana","authors":"D. Owusu-Manu, E. Amo-Asamoah, F. A. Ghansah, George Asumadu","doi":"10.1108/JFMPC-12-2019-0089","DOIUrl":"https://doi.org/10.1108/JFMPC-12-2019-0089","url":null,"abstract":"Purpose Kumasi Metropolis, the second-largest city in Ghana is known to be bewildered with challenges relating to waste management. As a means of solving the waste management challenge, several suggestions are often made for the establishment of a waste-to-energy plant to manage the disposal of waste and generation of income. There have been no studies conducted to determine how economically viable such plants will be. This study aims to examine the economic viability of waste-to-energy generation in the Kumasi Metropolis to find out how economically viable such an approach will be. Design/methodology/approach To achieve this, a simple debt-equity ratio business model based on discounted cash flow technique was applied to estimate the internal rate of returns (IRR) as a measure of the economic viability and profitability of a modelled 50 MWH waste-energy generation plant in the Kumasi Metropolis. The analysis was performed using the RetScreen Expert Software. Findings The results show that the IRR and benefits cost ratio of the facility were 36% and 5.8%, respectively, indicating high levels of profitability and economic viability. The study concludes that waste-to-energy generation will be an economically viable venture in the Kumasi Metropolis. Practical implications It is, however, important for users of the findings of this study to take caution of the fact that the various assumptions although based on current knowledge and expert opinion may vary with time; therefore, the sensitive analysis on price and costs should always be considered. Practically, this study will contribute to solving the waste management situation in most cities, as well as generating revenue and helping close the energy deficit most developing countries are grabbling with. Originality/value The unique contribution of the study to knowledge is that it has professed an alternative analytical and methodological approach to measuring the financial viability of waste-to-energy plants in situations where there is none in the geographical jurisdiction of the proposed project.","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-04-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49118881","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-04-08DOI: 10.1108/JFMPC-11-2019-0083
AbdulRahman Asaad, S. El-Sayegh
Purpose This paper aims to identify and assess the key criteria for selecting green suppliers in the United Arab Emirates (UAE) construction industry. Design/methodology/approach A total of 20 criteria were identified and shortlisted through an extensive literature review. These criteria were grouped into four categories: technical and commercial bid, company characteristics, environmental and socioeconomic. A questionnaire was then developed and distributed to construction professionals in the UAE. A total of 39 professionals responded to the survey including contractors, consultants, owners and suppliers. The respondents performed pairwise comparisons among the selection criteria. Data was then analyzed using the Expert Choice Software. Findings The research findings highlighted that the technical and commercial bid category was ranked as the most important with a weight of 0.338, followed by socioeconomic, company characteristics and environmental categories weighing 0.239, 0.225 and 0.199, respectively. The UAE construction professionals also ranked health and safety, material’s quality and tender price as the top three most important criteria when selecting a sustainable supplier. Practical implications This research addresses the lack of literature toward green supplier selection in the UAE. In addition, it assists contractors in selecting the appropriate supplier and promotes sustainable practices in the construction industry. Originality/value Material suppliers play an important role in the successful delivery of construction projects. Selecting the appropriate supplier is of paramount importance to project success. Several methods can be used to evaluate and select the best-fit suppliers. However, the selection criteria in such methods are primarily based on traditional construction projects rather than sustainable construction projects. Recently, there is an increase in the number of sustainable construction projects in the UAE. Therefore, identifying and assessing the key criteria for selecting green suppliers is needed. This paper fills the gap in literature as to selecting green suppliers in construction projects.
{"title":"Key criteria for selecting green suppliers for construction projects in the UAE","authors":"AbdulRahman Asaad, S. El-Sayegh","doi":"10.1108/JFMPC-11-2019-0083","DOIUrl":"https://doi.org/10.1108/JFMPC-11-2019-0083","url":null,"abstract":"\u0000Purpose\u0000This paper aims to identify and assess the key criteria for selecting green suppliers in the United Arab Emirates (UAE) construction industry.\u0000\u0000\u0000Design/methodology/approach\u0000A total of 20 criteria were identified and shortlisted through an extensive literature review. These criteria were grouped into four categories: technical and commercial bid, company characteristics, environmental and socioeconomic. A questionnaire was then developed and distributed to construction professionals in the UAE. A total of 39 professionals responded to the survey including contractors, consultants, owners and suppliers. The respondents performed pairwise comparisons among the selection criteria. Data was then analyzed using the Expert Choice Software.\u0000\u0000\u0000Findings\u0000The research findings highlighted that the technical and commercial bid category was ranked as the most important with a weight of 0.338, followed by socioeconomic, company characteristics and environmental categories weighing 0.239, 0.225 and 0.199, respectively. The UAE construction professionals also ranked health and safety, material’s quality and tender price as the top three most important criteria when selecting a sustainable supplier.\u0000\u0000\u0000Practical implications\u0000This research addresses the lack of literature toward green supplier selection in the UAE. In addition, it assists contractors in selecting the appropriate supplier and promotes sustainable practices in the construction industry.\u0000\u0000\u0000Originality/value\u0000Material suppliers play an important role in the successful delivery of construction projects. Selecting the appropriate supplier is of paramount importance to project success. Several methods can be used to evaluate and select the best-fit suppliers. However, the selection criteria in such methods are primarily based on traditional construction projects rather than sustainable construction projects. Recently, there is an increase in the number of sustainable construction projects in the UAE. Therefore, identifying and assessing the key criteria for selecting green suppliers is needed. This paper fills the gap in literature as to selecting green suppliers in construction projects.\u0000","PeriodicalId":45720,"journal":{"name":"Journal of Financial Management of Property and Construction","volume":" ","pages":""},"PeriodicalIF":1.9,"publicationDate":"2021-04-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48028045","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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