Stakeholder-Related Causes of Cost Overruns in the Namibian Construction Industry

Cost and time are two primary parameters that require due consideration throughout the project lifecycle and the determining factors for project success. Literature shows that many projects fail to achieve their goal of being completed within the planned budget and schedule. However, limited studies on project time and cost overruns have been conducted in the Namibian construction industry and the stakeholder responsible for the overrun. Therefore, this research examines the stakeholder-related causes of cost overrun on construction projects in the Namibian construction industry during the implementation stage. The study adopted a quantitative research approach that employs a cross-sectional survey research design in data collection from a sample drawn from a population of professionals in the Namibian construction industry. The data collected was analysed using descriptive statistics comprising of means, percentages, Relative Importance Index (RII), and Spearman Correlation. The study found that five of the main factors contributing to cost overrun on the construction projects in Namibia from a ranking perspective are contractors’ financial constraints, inadequate contractor experience, inefficient project planning and scheduling by the contractor, poor site management, and delay in progress payment by the client. Furthermore, the study revealed that four out of the five factors causing cost overrun are related to contractors, while one was client-related. Based on these findings, the study concludes that projects on which an inexperienced contractor is engaged and poor payment regimes exist will experience cost overruns. The study recommends that activities undertaken at the execution stage should be monitored appropriately to prevent cost overruns on construction projects.