The Effect of Variation Orders on Project Cost and Schedule Overruns

Smith, Wouter (2016-03)

Thesis

ENGLISH ABSTRACT: Cost and schedule overruns are common occurrences in construction projects, regardless of the various studies that have been done on the subjects. These overruns can occur for a wide variety of reasons; most of these reasons however can be attributed to scope change. The General Conditions of Contract for Construction Works use Variation Orders (VO’s) to deal with scope changes. Where other studies have focussed only on cost overruns and their causes, or schedule overruns and their causes, this research uses information collected about VO’s to determine the role of changes on the project schedule and costs. A database of 137 projects which were completed within the last 10 years has been investigated in order to determine if the number of VO’s or timing of VO’s have any effect on the project cost and schedule overruns. The Western Cape Department of Transportation and Public Works was the client for all the projects, thus only public transportation projects were studied. The research finds that projects with more VO’s have larger cost and schedule overruns than those with less VO’s. Additionally it also finds that larger cost and schedule overruns occur when the VO’s occur later in the project.

AFRIKAANSE OPSOMMING: Koste en skedule oorskrydings in konstruksie projekte is algemene verskynsels, ongeag die aantal studies wat oor die onderwerpe gedoen is. Hierdie oorskrydings kan deur 'n wye verskeidenheid van redes veroorsaak word. Die meeste van hierdie redes kan egter toegeskryf word aan wysigings aan die omvang van projekte. Die algemene kontrakvoorwaardes vir konstruksiewerk (GCC) maak gebruik van Wysigingsopdrag (VO) om die veranderinge aan n projek se omvang te bestudeer. Waar ander studies slegs op koste oorskrydings en hul oorsake, of skedule oorskrydings en hul oorsake gefokus het, gebruik hierdie studie die inligting wat ingesamel is oor wysigingsopdrate om die effek van die veranderinge aan die projek skedule en kostes te bepaal. ‘n Databasis van 137 projekte wat binne die laaste 10 jaar volrooi is word bestudeer om te bepaal of die aantal wysigingsopdragte of tydsberekening van die wysigingsopdragte enige impak op die projek koste en skedule oorskrydings het. Die Wes Kaapse Departemetn van Vervoer en Publieke werke was die klient vir al die projekte, dus is word slegs publiek vervoer projekte bestudeer. Die navorsing vind dat projekte met meer wysigingsopdragte ondergaan groter koste en skedule oorskrydings as die met minder. Verder is dit ook bepaal dat groter koste en skedule oorskrydings ervaar word deur projekte waar die wysigingsopdragte later plaasvind.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/98379
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