Cost Overrun in Construction Projects in Malaysia: A Study on Contractor Related Factors

Abstract

In construction industry, the key to a successful project lies on the quality of works, completed
within the stipulated time with the planned budget. However, unexpected situations from different
parties involved may lead to the delay of the works that eventually affect the whole cost of the
project. The contractor is always been the main party who is dealing with the actual construction
scenario that may affect the overall process of the construction project. Hence, this paper aim to
investigate the contractor related factors that lead to cost overrun in the Malaysian construction
project in Malaysia. A quantitative method was employed in this research by obtaining the data
from questionnaire survey to G7 contractors in Selangor. The data were analysed using statistic
method and Relative Importance Index (RII) method. The results indicate that improper planning
and poor site management ranked the main factors that affect the cost overrun in construction
project. Therefore, the results of this study will be beneficial to the contractors in achieving
effective cost performance in construction projects in Malaysia.