TUNKU ABDUL RAHMAN COLLEGE

FACULTY OF ENGINEERING & BUILT ENVIRONMENT

DEPARTMENT OF QUANTITY SURVEYING & REAL ESTATE
BACHELOR OF QUANTITY SURVEYING (HONOURS)
YEAR 3
ACADEMIC YEAR 2015/2016
BTBE2052 RESEARCH METHODOLOGY
ASSIGNMENT
CAUSES AND EFFECTS OF DELAYS IN MALAYSIAN
CONSTRUCTION INDUSTRY
No Student Name
1. PAN MING CHUAN

ID. No.
14WTR12880

2.

14WTR12884

SHE ZHEN RUI

Assignment Mark

PROGRAMME

: RQS3

GROUP

:F

TUTOR

: DR SHEELA

DATE OF SUBMISSION

: 10 JULY 2015

Table of Contents
Abstract................................................................................................................................1
Introduction..........................................................................................................................2
Research Objective..........................................................................................................4
Research Questions..........................................................................................................4
Problem Statement...........................................................................................................5
Literature Review................................................................................................................6
Introduction......................................................................................................................6
Types of delay..................................................................................................................7
Causes of Delay...............................................................................................................7
Effects of Delay...............................................................................................................8
Possible Solution towards Delay.....................................................................................9
Extension of time...........................................................................................................10
Liquidated damages.......................................................................................................11
Research Methodology......................................................................................................12
Data Analysis.....................................................................................................................14
Conclusion.........................................................................................................................15
Anticipated Finding...........................................................................................................16
References..........................................................................................................................17

Abstract
A major problem in construction projects is delay of time. The goals of this work are to
identify the causes that contribute to this and to examine its effects towards construction
projects and the participated parties. The final completion date of the project, most of the
time is later than the expected completion date since long time ago. Thus, it has become a
must to investigate the factors causing delay and the possible solutions to resolve these
problem.
This research is to provide an in-depth analysis of the potential factor and effect of delay
in construction projects, which would be helpful for building professionals in advance to
reducing the chances of getting delay and reduce the influences from the delay.
To achieve the study objectives, a questionnaire survey was carried out to collect
information on potential effects, factors and the possible solution of the delay of time.
Responses from 100 professionals from the construction industry which from developer,
contractors and consultant firms were analysed.
This studies has identified seven factors of delay: (1) Client related factors, (2) Contractor
related factors, (3) Consultant related factors, (4) Material related factors, (5) Labour
related factors, (6) Equipment related factors, and (7) External factors. The six effects of
the delay: (1) Time overrun, (2) Cost overrun, (3) Dispute, (4) Arbitration, (5) Litigation,
and (6) Total abandonment.
This paper presented only the professions and developers view of the causes and effects
of delay in time on construction projects in Malaysia. The study will benefit the
professionals involved with institutional building projects. The professionals would have
the knowledge about the negative effects that cause by the delay.

Introduction
Construction industry is defined as the industry concerning the carrying out of
construction works. It also include such work like planning, design, supply of materials,
financial services and construction-related research and development. Other definition of
construction which under the Financial (No.2) Act 1975 of the United Kingdom the
construction operation is include construction, alteration, repair, extension, demolition or
dismantling of building and structures including offshore installations and any works
forming part of the land, installation of mechanical and electrical system in building and
structures, and internal cleaning of buildings and structures carried out in the course of
their construction, alteration, repair or restoration. (George Ofori, 1990)
All parties in the construction industry are primarily concerned with quality, time and
cost and yet the majority of construction projects are procured on the basis of only two of
these parameters, namely time and cost. The literature emphasises time as an indicator for
project success. (Ramanathan, C et al., 2012)
Completing projects on time is an indicator of efficiency, but the construction process is
subject to many variables and unpredictable factors, which result from many sources.
These sources include the performance of parties, resources availability, environmental
conditions, involvement of other parties, and contractual relations. However, it is rarely
happen that a project is completed within the specified time. (Sadi A. A. & Sadiq A.H.,
2006)
This is normally named as delay which is a problem always occur in the construction
project which is a very serious criteria. However, the delay in the construction industry
has caused many troubles and issues towards the parties involve. Construction industry is
involved of many parties to run out all the process so it is very easy to happen delay in
construction site. Delay is often involved of large amount of cost to claim by either party.

Cost and schedule overruns occur due to wide range of factors. If project costs or
schedules exceed their planned targets, client satisfaction would be compromised. The
funding profile no longer matches the budget requirement and further slippage in the
schedule could result (Kaliba et al., 2009). According to Ahmed et al. (2002), delays on
construction projects are a universal phenomenon and road construction projects are no
exception. Delays are usually accompanied by cost overruns. These have a debilitating
effect on contractors and consultants in terms of growth in adversarial relationships,
mistrust, litigation, arbitration, cash-flow problems, and a general feeling of trepidation
towards other stakeholders (Ahmed et al., 2002). This problem is not unique to developed
countries and is being experienced in most of the developing economies.
Hong Kongs construction industry has emphasised that timely delivery of projects within
cost and quality standard specified by the client is criteria of successful project delivery.
Failure to achieve time, cost and quality of the project will cause various unexpected
negative eects to the projects. When the projects are delayed, they are either extended or
accelerated will incur additional cost. Construction projects usually have a percentage of
the project cost for contingency allowance for the uncertainty changes. Even though, the
contract parties agreed upon the extra time and cost related with delay, in many cases
there were problems between the client and contractor such as claim of the contractor
towards the extra cost. Such situations, usually involved questioning the facts, causal
factors and contract interpretation. Thus, delays in construction projects cause
dissatisfaction to all the parties involved. (Murali S. & Yau W.S., 2007)
In this research, our main goal is to find out the causes and effects of the delay towards
the construction industry. As this is the problem that happens towards most of the project
in the Malaysias construction industry. We hope that our research can let those parties
such as contractors and consultants aware of the causes and seriousness of the
consequences caused by the delay in construction.

Research Objective
The research is to achieve the following objectives:
1. To ascertain the effect of delay towards construction industry.
2. To find out the causes of delay in construction industry.
3. To determine the solutions to resolve the delay in construction industry.

Research Questions
The research question the way of to gain the objective research. The questions are:
1.
2.
3.

What does the delay effect in construction industry?

What cause the delay in the construction industry?
What solution to solve the delay in construction industry?

Problem Statement
According to the Kang S. W. (2010), delay is a very common problem that happen in the
construction project and cause multi negative effect on the project and the participated
parties. The final completion date of the project, most of the time is later than the
expected completion date since long time ago. Thus, it has become a must to investigate
the factors causing delay and the possible solutions to resolve these problem.
Kang S.W. (2010) also stated that delay in dispute settlement will affect the relationship
between owner and contractor. Moreover, it will also contribute to the cost and time
overruns. The most serious problem is it sends bad signals to foreign investors thereby
slowing down the national progress. It is generally said that the contract language is
considered difficult to comprehend and they are therefore a major source of disputes.
The construction process can be divided into three important phases, i.e. project
conception, project design and project construction. Usually, the vast majority of project
delays occur during the construction phase, where many unforeseen factors are always
involved. (Ramanathan, C et al., 2012)
This research is to provide an in-depth analysis of the potential factor and effect of delay
in construction projects, which would be helpful for building professionals in advance to
reducing the chances of getting delay and reduce the influences from the delay.
To achieve the study objectives, a questionnaire survey was carried out to collect
information on potential effects of delay. Responses from 100 professionals from the
construction industry which from developer, contractors and consultant firms were
analysed.
The study will benefit the professionals involved with institutional building projects. The
professionals would have the knowledge about the negative effects that cause by the
delay.

Literature Review
This literature review is done with a method of research the journal that done by the
previous researchers and get information from the thesis researches have been done by
others. This literature review is to get the overview of the topic in terms of their
background, types, causes, effect and the possible solution towards the delay in
construction industry. The keywords we used were delay, extension of time, issues,
and construction.

Introduction
In construction, delay could be defined as the time overrun either beyond completion date
specified in a contract, or the date that the parties agreed upon for delivery of a project. It
is a project slipping over its planned schedule and is a common problem in construction
projects. To the developer, delay means loss of in terms of revenue through lack of
production facilities and rentable space or a dependence on present facilities. In some
cases, to the contractor, delay means higher overhead costs because of longer work
period, higher material costs through inflation, and due to labour cost increases. (Sadi A.
A. & Sadiq A.H., 2006)
Majid (2006) stated that delays can be minimized when their causes are identified.
Identification of the factors of delays has been studied by many researchers in different
countries. Delay is a situation when the contractor, consultant, and client jointly or
severally contributed to the non-completion of the project within the original or agreed
contract period.

Types of delay
Theodore (2009) mentioned that there are four basic ways to categorize type of delays:
a)
b)
c)
d)

Critical or noncritical
Excusable or non-excusable
Compensable or non-compensable
Concurrent or non-concurrent

In the process of determining the effect of a delay on the project, the analyst must
determine whether the delay is critical or noncritical. The analyst must also assess if
delay are concurrent. All delays that are identified in the analysis will be either excusable
or non-excusable. Delay can be further categorized into compensable or noncompensable delays.

Causes of Delay
Delays in construction projects can be cause by many factors from different parties.
These range from factors inherent in the technology and its management, to those
resulting from the physical, social, and financial environment. There are in total of seven
groups of causes for delay in construction project:
1.
2.
3.
4.
5.
6.
7.

Cause of delay by client

Cause of delay by contractor
Cause of delay by consultant
Cause of delay by materials
Cause of delay by equipment
Cause of delay by labours
Cause of delay by external factors(Kang S. W., 2010)

Effects of Delay
The effects of construction delays on project delivery in construction industry. The six
effects of delay identified by the previous researchers, Murali S. & Yau W.S. (2007) were:
a)
b)
c)
d)
e)
f)

Time overrun;
Cost overrun;
Dispute;
Arbitration;
Litigation; and
Total abandonment.

In the report of Owolabi James D (2014), there were nine effect of delay was studied
which are:
1.
2.
3.
4.
5.
6.
7.
8.
9.

Time overrun
Increase in final cost of project
Tying down of client capital due to non-completion of the project
Wastage and under-utilization of man power and resources
Abandonment of project
Reduced profit
Dispute between parties involved
Litigation
Arbitration

Over all of the nine effect, the top three effect bring by the delay are time overrun,
increase in final cost of project and tying down of client capital due to non-completion of
the project. These is already been research by the Owolabi James D(2014) which found
out 53% of the respondent is strongly agreed that delay will bring time overrun.

Possible Solution towards Delay

Delay will bring client suffer from the profit lost or increases expenses. Thus, it is very
important to resolve this situation. The possible solution for delay are (Kang S. W.,
2010):
No
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

Methods
Frequent progress meeting
Use up-to-date technology utilization
Use proper and modern construction equipment
Use appropriate construction methods
Effective strategic planning
Proper material procurement
Accurate initial cost estimates
Clear information and communication channels
Frequent coordination between the parties involved
Proper emphasis on past experience
Proper project planning and scheduling
Complete and proper design at the right time
Site management and supervision
Collaborative working in construction
Compressing construction durations

Extension of time
Kang S. W. (2010) identified extension of time (EOT) as an excusable delay that occurs
when the contractor is delayed by occurrences beyond his control. The Government of
Malaysia P.W.D. Form 203A (Rev. 10/83) form of contract is widely used in public sector
construction projects (Government of Malaysia, 1983). It provides 11 clauses whereby
the contractor is eligible for an extension of time. Data related to extension of time were:
1. Extension of time (EOT) due to clause 43a, force majeure;
2. EOT due to clause 43b, exceptionally inclement weather;
3. EOT due to clause 43c, direction given by Superintending Officer (SO)
consequential upon disputes with neighbouring owner;
4. EOT due to clause 43d, loss or damage occasioned by allowable contingencies;
5. EOT due to clause 43e, Superintending Officers instructions;
6. EOT due to clause 43f, contractor not having received in due time necessary
instructions, drawings, levels or instructions in regard to the nomination of
subcontractors and/or suppliers;
7. EOT due to clause 43 g, delays in giving possession of site;
8. EOT due to clause 43 h, any action due to local combination of workmen strike,
or lockout affecting any of the trades employed upon the works;
9. EOT due to clause 43i, delay on the part of artists, tradesmen or others engaged
by Government in executing work not forming part of the contract;
10. EOT due to clause 43j, contractors inability, for reasons beyond his control,
which he could not reasonably have foreseen at the date of closing tenders;
11. EOT due to clause 43k, delays on the part of nominated suppliers.
The contractor that occurs delay due to the present of the event above the contractor can
claim for the extension of time by giving written notice to the contract administrator
identifying the relevant event that has caused the delay. If the contract administrator
accepts that the delay was caused by a relevant event, then they may grant an extension
of time and the completion date is adjusted.

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Liquidated damages
According to Twyford (2007), in the construction contracts liquidated damages clauses
are usually inserted to encourage compliance with time provisions, in particular,
completion of the work and payment on time. In regard to completion of the work, a
typical clause will provide that if the work is not completed by the extended date for
completion, liquidated damages, at the daily rate provided by the schedule, shall become
due and payable. A similar provision is made for overdue payments under the contract.
Liquidated damages clauses have the virtue of informing both parties to a contract in
advance what the damages payable for an identified breach will be at the time of entering
the contract. This can be equal advantage to the party who must pay the damages as it is
to the party receiving the damages. The upper limit of the damages payable is fixed and a
party can take this into account in the initial negotiations. It is not uncommon for a
contractor who knows he or she cannot complete within the required time to add the
liquidated damages equivalent of the time overrun to the tendered price.
Thus, liquidated damages are not penalties, they are pre-determined damages set at the
time that a contract is entered into, based on a calculation of the actual loss the client is
likely to incur if the contractor fails to meet the completion date. However, it is a method
for client to encourage the contractor to complete the construction project within the
construction period that set by client in order to get the full contract sum and avoid
counter claim by the client.

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Research Methodology
In the developing countries, there have been a lot of adverse effects on ongoing projects
as a result of constant changes in the course of carrying out such projects. To achieve the
study objectives, a questionnaire survey was carried out to collect information on factors
and potential effects of delay.
Throughout the literature review, we can get a comprehensive list of causes and effect of
delay in the construction industry by using basis for the formulation of a questionnaire. It
was compiled from a review of previous works which comprised of documented
observations, opinion and views of various specialists and experts of more than 20 years
experience in the field. A survey of 100 professionals from all the construction field as
the professional from developer firms, contractor firm and consultant firms was carried
out. It also contains experience of respondents in construction industry ranged from 4 to
30 years. A total of 100 questionnaires were sent to the above respondents, together with
a covering letter explaining the purpose of the study and assuring them of anonymity. The
questionnaires were delivered personally to them. The aim of the questionnaire was to
collect data for ranking the effects of delay in construction industry.
The questionnaire was divided into four sections. Section A requested background
information about the respondents such as the name, age, race, and the categories they are
either developer, contractor or consultant.
Section B is focused on causes of construction delay. The respondents were asked to
indicate their response category on construction delay factors to extract the cause of
project delay. These causes were categorized into the following seven major groups:
1. Client related factors: finance and payments of completed work, owner
interference, slow decision making and unrealistic contract duration imposed by
owners.
2. Contractor related factors: delays caused by subcontractor, site management,
improper construction methods, improper planning and errors during
construction, and inadequate contractor experience.
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3. Consultant related factors: contract management, preparation and approval of

drawings, quality assurance and waiting time for approval of test and inspection.
4. Material related factors: quality of material and shortage in material.
5. Labour related factors: labour supply and the labour productivity and
equipment availability and failure.
6. Equipment related factors: equipment availability and failure.
7. External factors: weather condition, regulatory changes, problem with
neighbours and unforeseen site condition
In this section B we are going to ask by five-point Likert scale. The responses will
number by giving numerical values for ratings the subsequence factors. The outcome of
the exercise as shown by responses monitored via a 5-point Liker:
1 =Strongly disagree
2 =Disagree
3 =Neutral
4 =Agree
5 =Strongly agree
Section C of the questionnaire focused on the effects of construction delay in Malaysian
construction industry. The six effects of construction delay identified were: time overrun,
cost overrun, dispute, arbitration, litigation, and total abandonment. Similar to the Section
B of the questionnaire by using the five-point Likert scale
Section D of the questionnaire will focused on the possible solution to avoid the delay.
The respondents were asked to highlight their recommendation to resolve the
construction delays through an open-ended question.

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Data Analysis
The overall ranking of most important factors, causes, effects and procedures of change
orders control on construction projects was determined by the evaluation of the mean
rank score through the use of Statistical Package for Social Science (SPSS). A fivepoint Likert scale was used in the questionnaire to gauge the cause and potential effects
of delay in Malaysian construction industry.

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Conclusion
Through the research on delay, we found that it is still a major problem in the
construction industry. We have concluded that these journals had helped us found out the
factors and effects of delay in construction industry, and the possible solution to resolve
the delay in construction industry. Other than that, these journals had helped us to
complete our research which is Causes and Effects of Delay in Malaysian Construction
Industry.

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Anticipated Finding
The present study was designed to determine the causes and effects of delay in
construction industry. The main finding for the causes of delay can be summarized as
follow seven factors: 1. Client related factors. 2. Contractor related factors. 3. Consultant
related factors. 4. Material related factors. 5. Labour related factors. 6. Equipment related
factors. 7. External factors.
On the other hand, the main finding for the effects of the delay can be summarized as
follow: 1. Time overrun. 2. Cost overrun. 3. Dispute. 4. Arbitration. 5. Litigation. 6. Total
abandonment.
The anticipated findings have been proven correct when we carried out this research. The
factors of delay stated above had shown us why delay happened so that the involved
parties can solve this problem to avoid experiencing the consequences of delay.

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References

Ahmed, S., Azher, S., Castillo, M. and Kappagantula, P. (2002) Construction

delays in Florida; an empirical study, Florida, 2002.

George, O., 1990, The Construction Industry: Aspects of Its Economics and

Management, Singapore, Quaser Technology Pte Ltd.

Kang, S. W., 2010, Causes, Effects And Methods Of Minimizing Delays In

Construction Projects, Universiti Teknologi Malaysia.

Kaliba, C., Muya, M. and Mumba, K., 2009, Cost escalation and schedule
delays in road construction projects in Zambia, International Journal of

Project Management, 27, 522-531.

Majid, 2006, Causes and Effects of Delays in Aceh Construction Industry,

Master of Science in Construction Management, Universiti Teknologi Malaysia.

Murali, S. & Yau, W.S., 2007, Causes and effects of delays in Malaysian
construction industry, International Journal of Project Management 25(2007)

517-526.
Owolabi James, D et al, 2014, Causes And Effect Of Delay On Project
Construction Delivery Time, International Journal of Education and Research

Vol. 2 No. 4 April 2014

Ramanathan, C et al., 2012, Construction delays causing risks on time and
cost a critical review, Australasian Journal of Construction Economics and

Building, 12 (1) 37-57.

Sadi, A. A. & Sadiq, A.H., 2006, Causes of delay in large construction

projects, International Journal of Project Management 24 (2006) 349357.

Theodore, J & Trauner, Jr. et al., 2009, Types of Construction Delays,

Construction Delays (Second Edition), Pages 25-36

Twyford, J., 2007, Liquidated Damages: A Comparative Study of the Law in
England, Australia, New Zealand and Singapore, Journal of Professional
Issues in Engineering Education and Practice, ASCE.

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