Factors which are critical in project cost overruns: A case' study of ministry of water resources projects
Abstract
This study sought to identify factors contributing to project cost overruns in the Ministry of
Water Resources. The policy objective of the water sector is to create an enabling
environment for orderly coordinated and sustainable development of water resources including
their conservation and protection. Towards this end, the Ministry has a strategy of supporting
and coordinating all water projects and programmes in both rural and urban areas.
Unfortunately, many of these projects are finally completed after some years, at a cost several
times the original estimate.
In order to achieve the objectives of this study, primary data was collected from a sample of 32
project participants. The respondents included project managers, site and office engineers,
supervisors and project officers. The information sought in the study was collected by means
of interviews and a self-administered questionnaire.
Factors Analysis was used to analyze the data. The results of the analysis indicated that
empirically five factors do emerge as the critical factors contributing to project cost overruns
in the Ministry of Water Resources. They are: project Organization, Environment, Project
Management, Project definition and Infrastructure and logistics. Further, suggestions as to
what needs to be done in the light of the above critical factors to minimize cost overruns have
been included in the summary and conclusions. They include:-
• adequate personnel policy
• adequate organization structure
• coupling of the different decision circuits within the bureaucracy with regard to
construction costs, personnel costs and general expenses.
• Assessment of time, costs and quality.
• External auditing.
• Good communication
• Environmental sensitivity
• Proper project management
• Complete definition of project requirements.
• Provision of adequate infrastructure facilities.
Citation
Degree Of Master of Business and AdministrationPublisher
Faculty of Commerce
Description
A management project submitted in partial fulfilment
of the requirements for the Degree of Masters In
Business Administration, Faculty of Commerce,
,
University of Nairobi