Factors Affecting Effective Project Cost Management The Case Of Nashcon Construction Plc

A project is successful only if it is completed within the approved time, quality and budget.rnStudies show that most projects in Ethiopia are not completed on time because of cost andrnschedule overrun due to lack of proper project cost management. Managers in thernconstruction industry therefore need to focus on project cost management in order to attainrnproject success.rnThis research is done on a company called Nashcon Construction PLC. The main objective ofrnthe research is to improve the company’s Project Cost Management process by identifyingrnfactors which affect the effectiveness of the process most.rnThe researcher employed a mixed research approach to investigate the problem under study.rnBoth quantitative and qualitative data was collected through questionnaire and interview fromrnpersonnel’s in Nashcon Construction PLC. The study concepts were developed throughrnliterature survey that enables to find out the variables. Furthermore, In order to obtain morerninsight on the cases, the study used review of document in the company and also an in-depthrninterview was conducted to assess the current status of the company’s project costrnmanagement implementation.rnThe research result shows that though Nashcon Construction PLC is implementing the threerncost management components (Cost Estimation, Cost Budgeting, and Cost Controlling)rncurrently, its cost management system is poor and needs improvement. After data analysis itrnwas discovered that the company’s cost management process is affected more by factorsrnrelated to Cost Budgeting this shows that the company has of poor cost budgeting system.rnFurthermore poor scope definition, not updating budget after variation of changes, inaccuraterncost budgeting, incomplete design, poor WBS design, material price fluctuation, allowance ofrnnumerous variation during project implementation, inaccurate/impractical schedule, poorrnallocation of costs, failure to site investigation, change in schedule and construction methods,rnnot having a risk register are identified as factors which affect the cost management processrnof Nashcon Construction PLC.rnFinally, based on the analysis of the results, recommendations have been proposed tornimprove the current project cost management of the company.

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