Thesis Abstract

<p>&nbsp;             <b>ABSTRACT&nbsp;</b></p><p>The objective of this study was to identify possible factors that would minimize or contain failure and abandonment of public sector construction projects, evaluate the identified factors in their order of importance. Data on the study variables were collected through structured questionnaire from construction firms located in Imo, Abia and Rivers States of Nigeria with wealth of experience in failed and abandoned public sector construction projects. Respondents were approached personally to collect the data. A total of three hundred (300) questionnaires were distributed while two hundred and fifty three (253) were retrieved and used for analysis. Various statistical tools such as descriptive statistics, cronbach's alpha test, as well as relative importance index with the aid of SPSS and Microsoft Excel were applied for data analysis and inference. The results of the study revealed that nine factors were critical in containing failure and abandonment of public sector construction projects in Nigeria. The factors include; Detailed and Comprehensive Design by the Contractors, Effective Monitoring, Understanding of Project’s Mission, Technical Knowhow of the Project Manager, Support from Top Management, Political Risks, Effective Procurement Process, Provision of Adequate Finance by the Client, and Effective Communication and Information Management by Design Team. Key words Construction projects, failure, abandonment, Containing failure and abandonment, public sector construction projects. <br></p>

Thesis Overview

<p> <b>1.0 INTRODUCTION</b></p><p><b>1.1 BACKGROUND STUDY&nbsp;</b></p><p>Construction projects in Nigeria and the world over are confronted with a lot of complexities and ambiguities as a result of uncertainties of not meeting project deadlines which also hinges on low quality, cost overruns which invariably leads to failure and abandonment of such projects. Incessant failure and abandonment of projects by the public sector according to (Ubani and Ononuju, 2013); Olalusi and Otunola, 2012) are continuously posing serious challenges to the stakeholders in the built environment. The construction industry is known to be the primary and focal point on which the development of any country rests on. It is viewed as the life wire as well as an instrument of choice of a country, due to its role in providing the basic requirements for the entire citizenry. In as much as the industry remains the instrument of choice for most policy makers, the low performance of projects in the construction sector and the disillusionment ensuing there from by stakeholders seems to have become the rule and the exception in recent time. To a greater extent, the growth and development of a country is determined by the quality and capability of its products from the built industry/ sector. Unfortunately, the inherent complex, uncertain and dynamic state of most construction projects created obvious problems of not achieving their initially stated objectives. Despite Nigeria’s position as the largest economy compared to South Africa, Nigeria has persistently performed poorly in terms of providing for her citizens the best life can offer in terms of better living standard, economic growth, justice and the likes (Ingwe, et al. 2010) Furthermore, Ingwe et al. (2010) opined that foregoing poverty indices has compelled Nigeria’s government into developing infrastructural facilities as a means of propelling advocacy for rapid development in terms of stimulating economic growth and development, but the performance of Nigeria’s government in this regard has been dismal. Nigeria’s present and nearly ubiquitous collapse of various infrastructures like roads, railways, transport, and education are a pointer to these facts. In Nigeria, a lot of factors contributes to project failure which most often than not, leads to outright abandonment. Failure in construction projects is construed to be a negative consequence ensuing from risk actions that invariably leads to obstruction of any or some impending benefits derivable from the project. Furthermore, failure is said to occur in a component when the various elements that make up the components can no longer be relied upon to fulfill its initial objectives. On the other hand, abandonment is a situation whereby the client/owner of a project ceases to provide or make provisions for maintenance and operating services to a project. Abandonment occurs when management decides for whatever reason best known to it, discontinues temporarily or permanently a project under development (Ewusi-Mensah and Przasnyski, 1991).</p><p> Failed and abandoned construction projects abound everywhere; Malaysia, United States, Spain, Dubai, Saudi Arabia, Russia, Abu Dhabi (Hoe, 2013) and Nigeria (Ewa, 2013). See table 1 below on some failed and abandoned projects. According to Ewa (2013), there are about 4000 uncompleted or abandoned public projects to the tune of about ₦300 billion littered all over Nigeria and that it would take about 30 years to get them completed. Most authors have identified the factors responsible for construction project failure and abandonment. They include; lack of /poor planning, demise of client, unqualified project managers, incorrect cost estimates, poor design, political influence, poor funding etc. (Olalusi and Anthony 2012; Ubani and Ononuju 2013; Ayuba, et al. 2012; Hoe, 2013; Ayodele and Alabi 2011). Various scholars have tried to provide possible solutions to curtail the incidences of failed and abandoned construction projects, but still the problem keeps on rearing its ugly head (Hoe, 2013; Olalusi and Anthony 2012; Ubani and Ononuju 2013; Ayuba, et al. 2012; Sahibzada and Mahmood 1992). The aforementioned authors tried to provide solutions to the problems of failed and abandoned construction projects by merely making suggestions in their studies which obviously have not yielded sufficient results. It is in the light of these assertions that this study would provide possible solutions/measures for containing construction project failure and abandonment by way of carrying out an in-depth study into unraveling measures that if not possible would curtail the excesses of such a menace.&nbsp;</p><p> <b>1.2 STATEMENT OF THE PROBLEM</b></p><p>The construction industry has been one of the critical sectors of Nigeria’s economy before the era of the oil boom. Despite its role in the economy, it has been confronted with a lot of challenges as a result its inability to achieve ab initio set out goals. According to Ewa (2013), the issue of project failure and abandonment has been left unresolved for a very long time and this has created obvious room for a multiplier effect on the construction industry specifically and the entire economy as a whole. Olalusi and Anthony (2012) in their study opined that most construction projects that would have impacted on the economic and entire development of Nigeria, littered the nooks and crannies of the entire country. This affected the entire environment by defacing the aesthetics, and creating social problems as well as other health hazards to the entire populace. The abandonment of a public sector construction project normally does not directly affect the entire populace as a result of its absorption by the government through reserved funds. This scenario often leads to a loss of opportunity by the public not being able to benefit from the intended purpose. On the other hand, should additional funds be made available to revive such projects, this would invariably incur extra opportunity cost of foregoing the project’s original set objectives. (Hoe, 2013). According Onyekpere, (2011) the impact of failed projects in terms of cost and schedule overruns on a nation’s economy is enormous as the new costs incurred as a result of these scenarios would have been deployed for the development of other important projects for the overall benefit of the entire citizenry. Most projects frequently fail to achieve their goals due to a myriad of problems ranging from imperfect project design, poor stakeholder management, delays between project identification and startup, delays during project implementation, cost overruns, and coordination failure. Amade et al (2014) opined that, the entire nooks and crannies in Nigeria is a washed with evidence of failed and abandoned construction projects stemming from cost related issues viz poorly articulated cost estimating principles, poor risk management practices which is often hinges on clear cut knowledge of contingency provisions and management. Latham, (1994) opined that the public sector is usually particular about using their spending power in obtaining value for money on a particular project while also assisting in enhancing the productivity and competitiveness of the construction industry in terms of obtaining better value for money generally in the long term.&nbsp;</p><p>According to Potts, (2008), construction activities are prone to huge capital expenditure which the client may not commence implementation without confirming the state of the benefits accruing. In the case of the society benefiting from the project, in this case a public sector project, the justification for such a project will be based on the cost-benefit analysis. Much attention should be accorded to the budgetary process so that the project doesn’t fail to achieve it stated objectives. Morris, (2012) further stated that managing public-sector projects can be more difficult than the private-sector projects because they most times operate in an environment that is prone to conflicts, while also involving different stakeholders with varied interests. While Ali, (2010) opined that the public sector are differentiated by the activities of their counterparts in the private sector. There is no tendency for profit making, but rather a minute potential for income generation while also lacking on specific basis for performance measurement. Ali, (2010) further stated that the public sector organizations still possess the fulcrum to drive the growth of a nation’s economy. According to KPMG (2011) government as well as public sector projects are uniquely positioned to deliver highly-tailored local solutions, based on key insights gained from previous work with similar public and private sector organizations in different parts of the world.&nbsp;</p><p>A valuable mix of local specialists and leading global industry best practices consistently helps us to deliver valuable and sustainable strategies to the public sector clients. Possibly more than any other time in history, the public sector is confronted with a myriad of latest and complex challenges. Constant public scrutiny and the need for fiscal sustainability and a continued increase in demand for services has forced many governments to seek new ways to balance effective delivery of services in the short-term against long-term budget considerations. KPMG (2011) While Dlakwa and Culpin, (1990) opined that public sector projects in a developing country like Nigeria is prone to frequent delays compared to their counterparts in the private sector. The reasons for this are attributed to the delays in internal bureaucracy associated with most public service institutions. According to Opawale, et al. (2013) a study carried out in year 2000 on infrastructural development revealed that before 1999, Nigeria was losing a whooping sum of about $265 million annually via different types of illegal procedures in the award of contracts by government officials.</p><p>&nbsp;These illegal practices were in the form of escalated contract sums, use of unqualified contractors, over-invoicing, awarding contracts without budgetary provisions and most importantly diversion of contract sums into private pockets which most often than not leads to the failure of such projects and subsequent abandonment. Therefore it is the import of this work to critically provide far reaching solutions on how best incidences of failure and abandonment of construction projects could be curbed by specifically applying empirical research to address the underlying issues confronting public sector construction projects in Nigeria.&nbsp;</p><p><b>1.3 RESEARCH QUESTION</b></p><p>&nbsp;Based on the research problems identified, this study therefore attempts to provide answers to the following research questions.</p><p>&nbsp;1. What are the possible factors that would minimize or contain failure and abandonment of public sector construction projects in Nigeria?&nbsp;</p><p>2. How can the identified factors for containing construction project failure and abandonment be evaluated.&nbsp;</p><p><b>1.4 OBJECTIVE OF STUDY</b></p><p>1. To identify possible factors that would minimize or contain failure and abandonment of public sector construction projects in Nigeria.&nbsp;</p><p>2. To evaluate the identified factors in their order of importance &nbsp; &nbsp; &nbsp; &nbsp;</p>