Improving cost performance of public sector construction projects in Ghana. (a case study of greater Accra and Ashanti regions)

Abstract

Over the years, there have been improvements in the management of construction projects; however, globally, the problem of cost overruns is still a critical issue in the construction industry especially in developing economies which Ghana is no exception. The aim of this study was to examines the critical factors affecting cost performance in construction projects in Ghana. The study adopted a quantitative survey approach. The questionnaires were distributed via email. Out of three hundred and eighty (380) questionnaires distributed, one hundred and ninety four (194) usable questionnaires were retrieved from respondents representing 51 percent. The data was analyzed using descriptive statistics, factor analysis and multiple regression technique for analyzing relationships between variables. The findings revealed that the underlying construct of the numerous critical factors of cost overruns are directly linked to five (5) main themes; managerial-related issues, financing-related issues, cost estimate-related issues, politicalrelated issues, and market-related issues. The study also revealed that, the main causes of cost overruns are: poor contract management, delayed payment, inaccurate cost estimate, weak government policy, and escalation of materials prices. The study further revealed that the critical factors that can prevent or minimize cost overruns in construction projects, in Ghana are directly linked to five themes: namely; adequate planning-related, financing-related, effective collaboration-related, adequate project team capabilityrelated, and motivation-related. Moreover, the results further revealed that the most significant success factors that can help prevent cost overruns in construction projects, in Ghana are early involvement of the contractor, provision of adequate funds, good project team relations, use of competent managers/supervisors, and provision of incentives/ bonuses to project participants. It is recommended that; training courses and workshops should be conducted to improve managerial skills of project participants.