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A Construction Cost Flow Risk Assessment Model

Biomedical Sciences Research Institute Computer Science Research Institute Environmental Sciences Research Institute Nanotechnology & Advanced Materials Research Institute

Odeyinka, H, Lowe, J and Kaka, A (2002) A Construction Cost Flow Risk Assessment Model. In: The 18th Annual ARCOM Conference, Northumbria University, Newcastle upon Tyne, UK. Association of Researchers in Construction Management. 10 pp. [Conference contribution]

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URL: http://www.arcom.ac.uk/publications/procs/ar2002-003-012_Odeyinka_Lowe_and_Kaka.pdf

Abstract

Various 'short cut' approaches have been adopted in cash flow forecasting ranging from the statistical, mathematical, simulation and the use of artificial intelligence techniques. However, the majority of these approaches failed to consider the issues of risks and uncertainties inherent in construction. As such, a wide variation is observable between the predicted cash flow profile and the actual. This study attempts to model the variation between predicted and actual cost flow due to inherent risks in construction. Data were obtained through questionnaire survey and empirical data collection. Contractors on individual projects were requested to score on a Likert type scale, the extent of occurrence of each identified risk variable that resulted in the variation between the predicted and actual cost flow profiles. An analysis of the responses, using ranking of the mean response enabled the study to focus on the most significant risk variables. The impact of these risk variables on cost flow forecast was then investigated by collecting data on predicted and actual cost flow from completed construction projects in order to determine their variation. Neural network was employed using the back propagation algorithm to develop the cost flow risk assessment model. The developed model was tested on 20 new projects with satisfactory predictions of variations between the forecast and actual cost flow at 30, 50, 70 and 100% completion stages.

Item Type:Conference contribution (Paper)
Keywords:cost flow, contractors, modelling, neural network, risks and uncertainties
Faculties and Schools:Faculty of Art, Design and the Built Environment
Faculty of Art, Design and the Built Environment > School of the Built Environment
Research Institutes and Groups:Built Environment Research Institute
Built Environment Research Institute > Centre for Sustainable Technologies (CST)
ID Code:10615
Deposited By:Dr Henry Odeyinka
Deposited On:20 May 2010 13:32
Last Modified:01 Jul 2011 11:45

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