Abstract
Cost optimization is a process that should be carried out throughout the construction period to ensure that the cost of the project is within an allotted budget. Time and cost are the two most significant factors in any construction project. Cost increases with the time of construction. The objective of this study was to find out the factors that contribute to the optimization of construction costs in building construction projects in Nepal. The study was conducted during the period from April 2019 to September 2020. Field observation, in-depth interviews, focus group discussions and questionnaire surveys were the major tools for the investigation of this study. The findings were analyzed in nine categories: project related factors, design related factors, owner related factors, consultant related factors, contractor related factors, material related factors, labor related factors, equipment related factors, and external factors. The study found some key factors related to time and cost overrun, optimizing cost of construction and the strategies to optimize project costs. The most important strategy to optimize the construction cost are effective cost planning and control, development of proper monitoring and tracking system, sound working environment, recording daily work progress, using time cost trade off, follow plan-do-check-act quality policy, hire skilled labor and effective supervision. The study suggests that constructability and value engineering principles should be adopted in construction projects.
Highlights
Optimization is defined as value achievement with minimum cost
The study area is shown in figure (Figure 1) and the building construction projects selected for case study are listed in table (Table 1)
The study investigated the following major factors contributing to time overrun and cost overruns
Summary
Optimization is defined as value achievement with minimum cost It focuses on cost reduction, assurance of quality, value enhancement and value maximization. The construction industry is one of the largest businesses in the world Growth in this business is an indicator of the development of a country. The construction industry contributes to the development of infrastructure, sanctuary, hospitals, schools, townships, offices, houses, water supply, sewerage, drainage, highways, roads, ports, railways, airports, power systems, irrigation, and telecommunications [3]. It deals with all economic activities directed to the creation, renovation, repair or extension of fixed assets in the form of buildings, land improvements of an engineering nature. It provides a growth impetus to other sectors through backward and forward linkages
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