Causes and Effects of Change Orders for Construction Projects in Palestine رسالة ماجستير

Abstract

The construction sector plays a crucial role in the Palestinian economy with a complex nature, which encompasses a mix of various human, non-human, and other elements that necessitate change orders. Change orders are an inevitable aspect of construction projects, regardless of their size, type, or characteristics, and are often cited as the main source of disputes within the industry. Furthermore, change orders serve as the official process for initiating changes in the design and contract documents during the construction phase. Changes frequently lead to delays in schedules and cost overruns, which create a negative impact on project performance and profitability. The purpose of this project is to investigate and rank the causes and impacts of change orders in construction projects in Palestine from contractors' and consultants' perspectives. It is crucial to understand these aspects to reduce potential changes in the future. To achieve the study objectives, a literature review was conducted to explore the causes and impacts of change orders as secondary data. Subsequently, a pilot study was conducted to assess the questionnaire's validity. Primary data for the study was collected through a structured survey distributed among professionals in the construction industry. The study sample was acquired using a method of stratified sampling, where participants were randomly chosen from various groups; contractors, and consultants who are key stakeholders in construction projects. Based on the results from the statistical equation, the minimum sample size required is 49 questionnaires. In order to obtain more accurate results, a total of 75 questionnaires were distributed to potential respondents at all levels in the VI construction industry. More specifically, 40 questionnaires were sent to contractors and 35 to consultants. A total of 70 responses were received, with 5 responses being considered invalid, resulting in 65 valid responses. A total of 65 questionnaires representing 93% of the responses, were analyzed using statistical techniques such as the Relative Importance Index to identify the importance and ranking of causes and impacts of change orders. Furthermore, the Standard Deviations technique was used to illustrate the degree of agreement between contractors' and consultants' perspectives. The SPSS software was also used to identify the correlation between the causes of change orders and the general characteristics of respondents representing construction firms. The findings revealed that internal factors related to the owner were the primary source of change orders, followed by factors related to internal consultants, internal contractors-related causes, and external factors such as political situations and lack of skilled labor, respectively. It also identified the major five causes of change orders with the highest relative importance index were, “using duplicated documents from previous projects”, “change in plan and scope by owner”, “owner's financial difficulties”, “poor site investigation before the design stage”, “errors and omissions in design”. Similarly, the study presented the top five impacts of change orders on construction performance as “ time overruns”, “cost overruns”, “rework and demolition”, “delay in payment by the owner”, and “disputes between contract parties”. Ultimately, the mitigation of different causes leading to change orders can be achieved by enhancing awareness and ensuring the active involvement of all project parties. It is recommended that professionals remain vigilant of the triggers for change orders in construction projects. Additionally, construction experts should implement effective planning VII strategies and establish a robust framework for proactive change management. This study holds particular importance for the construction sector, offering valuable insights to help project management teams meet the objectives of projects in terms of schedule, budget, and quality.