Tambo Plaza Housing Development Project Failure Construction Essay

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This research investigates the impacts of four major key components on performance of construction projects particularly the Tambo Plaza Housing Project. The broad four components are project scope management, project time management, project cost management, and project quality management. A questionnaire survey was conducted on the selected attributes and quantitative analysis was performed to understand criticality and impacts on the Tambo Plaza project. The key findings of this research are the identified links between the factor variables within current project management practices. The findings of this study helped in understanding the impacts of critical factors affecting the project performance and minimize the risk of construction project failure.

INTRODUCTION

A successful project can be defined as a project that has been completed on schedule, within budget, within scope and satisfied the required quality. To achieve successful projects, it is the planning phase which has the critical control over the project performance especially in the aspects of project schedule and cost. Tambo Plaza Housing Project was based on servicing by the Construction of civil engineering Services and other minor works such as Road, Storm water, Sewer, water pipeline and platforms bulk Earthworks in an informal Township (1050) sites at Inanda Area in Durban over a period of 24 months, (Commencement- 20/06/2007 and Original Completion Date- 19/06/2009). However, with the contractor�s involvement and investigations it was discovered that the project actually services 1509 sites, which is 44% more than tendered. This project comprises of four distinct areas within the Langalibele Township, with phase A having the biggest Greenfields area of + 220 sites out of + 360 sites which were chosen as a starting point to kick start the project. The storm water design on this project was only done on the 8th month of the project, as a result of a huge storm which changed the design engineer�s idea that the limited storm water was adequate.

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� This project went out to public tender in October 2006, with the compulsory site inspection on the 25th of October 2006, and the tenders closed the 17th of November 2006, and the tender closed with a public opening on the 17th of November 2006, where NRC/NNLK JV were successful of being the lowest qualifying compliant contractor though the tender period and information was very limited and vague.

� This contract was finally awarded to NRC/NNLK JV on the 30th May 2007, which was way after the normal three month tender validity period.

� The contractor then set about getting their sureties and contract all risk, public liability and SASRIA political insurances in place.

� The Tambo Plaza housing development project was finally handed over to the contractor on the 20th of June 2007.

� The excitement of commencing such a large project was short lived, as it became evident that this project was fast tracked and politically steamrolled through all the different line departments in order to satisfy the disgruntled community / benefactors of this project, as a result proper design / working drawings and setting out information not being available as well as The Environmental Management Policy (EMP) Right of Development (ROD) had not been attained.

� The contractor then had to assist by getting their surveyors and site staff to look for and collate as built information of existing services, so as to speed up the design of the new services.

� The Project Managers had also done a very basic and uniformed report on the ring fencing of the affected benefactors of this project.

2. SCOPE MANAGEMENT

� This project was based on servicing 1050 sites but with the contractor�s involvement and investigations it was discovered that the project actually services 1509 sites, which is 44% more than tendered.

� This project comprises of four distinct areas within the Langalibele Township, with phase A having the biggest Greenfields area of + 220 sites out of + 360 sites which were chosen as a starting point.

� Delays due to funding have been a frustration in terms of delivery of serviced sites as tendered.

� In terms of the original contract it should have been + 60% complete the contractor had a lagging at + 40% due to the allocations of temporary and permanent housing to beneficiaries as the sales administration and social facilitation were introduced late into the project.

� There has also been a huge frustration with the slow and limited access to the final design drawings which was sitting at +70% complete at + 60% of the elapsed contract time period.

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� The storm water design on this project was only introduced on the 8th month of the project, as a result of a huge storm which changed the design engineer�s idea that the limited storm water was adequate.

� The contractor then had to source pipes in a hurry as the roads were being prepared for layer works.

� They had to put the storm water in the roads as there were no spaces on the sidewalks as the water and sewer had been laid.

� Special catch pits had to be built to accommodate the Kerb line which was +/- 1m from the storm water line; this caused a delay of 8 weeks to the layer works in Phase A.

3. TIME MANAGEMENT

� This project was a twenty four month contract period.

� The contract program was approved by the client in the middle of July 2007.

� The first Frustration was that the contractor was only allowed to start work in August 2007, as a result in the delay in the issuing of the R.O.D certificate in terms of the Environmental Management Policy an additional frustration was the slow access to approved design drawings and setting out date which forced the contractor to limit their resources and speed of construction to accommodate these delays.

� In fourteen months of a twenty four month contract they have lost eight months due to bad planning, limited access, limited design, political interference and lack of funds.

� It has been a planning nightmare to accommodate all these delays in terms of design and obstructions to make sure that the contractor on site uses their resources on site costs effectively and profitably.

� The contractor also submitted various extensions of time claims in terms of clause 42 of General Conditions of contract in accordance with clause 48 of General conditions of Contract 2004 and they received a lot of reluctance and resistance in awarding/acceptance of these claims with cost, as the professional team felt that there were a lot of other Areas that were accessible to get continuity of work.

� As contractors are generally mistrusted and that engineers fear/failure of admitting that they have made a mistake.

4. COST MANAGEMENT

� Although this project is subject to contract price adjustment in terms of CPIX.

� It had an under recovery on certain oil based products as well as huge loss on Steel products which had a 53% increase from February 2008 to July 2008.

� A huge frustration was meeting the tendered allowable and productions, which have been scaled down because of the lack of access and having to accommodate design changes and obstructions.

� The contractor was forced to monitor the plant utilization versus availability on a basis in order to manage any downtime losses that may occur.

� It was found that by monitoring the daily site costing, they were able to identify a few unrealistic priced items that were red flagged and monitored strictly that they do not lose anything more than necessary.

� This project was also priced very competitively in order to secure a full order book and has resulted in the site management to be very vigilant in cost control and working more smartly and productively.

� It was also found that the site cost reporting faced a lot of challenges and hurdles from site foreman who tend not to like doing any paperwork and sometimes only fill out the necessary plant and labour timesheets after being threatened with pay cuts as a lot of extra work was done and not paid for.

5. QUALITY MANAGEMENT

� To monitor the quality of material delivered and handle on site is a huge frustrating task as it�s often supplied under cured poor quality concrete products.

� Door and Window frames were manufactured out of square and built in by over ecstatic sub contractors who were chasing targets/money.

� Workmanship on block work to housing has its own challenges as their sub contractor�s abuse their workmen and the contractor forced to hold back money for defects.

� As the upgrading of informal settlement, the contractor was constantly challenged by local children, animals, etc. that vandalize the freshly poured concrete slabs or drains.

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� Handing over of tested and completed work to different line departments at EThekwini municipality constantly inundated with having to go back and clear blockages as the locals did not appreciate the new services that they have at their disposal.

� Local structures to set up a workshop to educate the beneficiaries of this project as this poses to be a long term problem which may even see the total failure of services.

6. HUMAN RESOURCE MANAGEMENT

� Productivity in certain aspects of work has always been a challenge as it is human nature to do less if you can get away with it.

� The contractor was constantly held to ransom by the demands of local labour and sub contractors, which tend to take a considerable amount of site management time.

� The levels of skills are always a service challenge as the contractor was forced to employ labour within the boundaries of the project/ward.

� As a company they had a continuous demand for more operational information, they tried to employ more line supervisors but found that a lot of the time that they had management crisis rather than planning as a result of all the different obstructions faced on site.

� Also found as a result of the fractured/isolated nature of the different work modes that the contractor have a high work management ratio, which results in workers tending to drag work along without being noticed.

7. COMMUNICATION MANAGEMENT

� Poor communication from project management team has always been a challenge from the onset of the project and was only to an extent been properly managed, with the introduction of the new project engineers.

� The internal politics in the ward was a huge frustration, which finally came to a head, with there being a new project steering committee and community liaison officer appointed.

� Discipline/punctuality from the project management team has been a huge frustration as well as the late issue of the site meeting minutes, verbal instructions are slow to be confirmed in writing and always have to be pre-empted by the contractor.

� The local structures always left out of design and the found themselves playing the role of project managers in order to get them back on board.

8. RISK MANAGEMENT

� The cost of Security in the upgrading of informal settlements is astronomical and is way above what the contractor catered for.

� Theft and shrinkages of materials as well as fuel is a huge disappointment and normally a huge problem to handle with the police as building materials do not have serial numbers.

� In terms of security the contractor coerced into using a so called local security as a result of a number of security threats to staff and surveyor with his assistants being hijacked and his vehicle and equipment being stolen as well as theft on fuel and vandalism to plant and equipment.

� With getting the variation order for the building of permanent housing, came and added logistic nightmares to control building materials, both for the supply and what have been built in , as the housing was spread over a large geographical which had also encompassed a fair amount of informal dwellings.

� This provided to be a challenge for the so called local security as poverty can be a huge temptation to steal material for resale as there will always be a willing seller and a willing buyer under these conditions.

� This project had an additional frustration in that it is also divided politically VIZ. ANC +-/ 70% and IFP +/-30% with phase A and B being effected the most with almost a 50/50 split in the political divide.

� This has proven to be a huge challenge as phase A had the largest Greenfield area followed by Phase B and with the next General Elections looming, the contractor found themselves in the middle and have spent a huge amount of time to try and Broker an amicable solution to the differences of the ward committees who are trying to score bonus political points at the contractors expense.

� With the uncertainty of the power struggle within the community, the allocation of housing became a very thorny issue as these political groups are trying to improve their own political numbers at the projects expense and with the real threat of invasions were given an instruction not to complete houses until the allocation problems are resolved.

� Health and safety management has also been a huge challenge, as the contractor had been excavating trenches among the informal dwellings which have children of all ages moving around who are not properly supervised.

9. PROCUREMENT MANAGEMENT

� Concrete, storm water pipes supply and delivery has been the biggest challenge as local pipe suppliers have been running at max capacity.

� Most suppliers had been reluctant to fix their prices and have put a lot of pressure on the contractor to beat their allowable.

� Although all of the contractor�s materials used on this project are standard shelf items, it is still a mammoth task in securing deliveries from various suppliers as they always fall back on their delivery promises.

� Also had to be vigilant in monitoring the deliveries as there are always supplier delivery drivers trying to manipulate the site staff into signing proof of delivery notes that are duplicate and material is dropped off somewhere else and sold, although the company ordering system had the features of monitoring back orders and work cost grouping, it was still a challenge that information that is fed in incorrectly or not done timorously needs to be monitored and audited so that the correct information is reported with the late instruction from the contractor to acquire the water reticulation pipe and fittings, this had caused a two week delay on this section of the work which we also submitted a claim for.

RESEARCH METHODOLOGY

Selection of data collection method was conducted prior to the data analysis stage. One on one meeting�s held with the following people involved in the project:

� Architect

� Engineer (former and present)

� Contract administrator

� Project manager

� Quantity surveyor

� Contracts manager

At the end of each meeting a questionnaire was handed out that was prepared to find out each individual�s opinions or even their own possible solution to the problem. It appeared questionnaire was the most appropriate data collection means for this research project. The advantages of using questionnaire method as follows:

� Low cost in money.

� Easy and quick to collect information from many respondents.

� Respondents can complete the questionnaire at their time convenience.

� Analysis of answer to closed questions is straightforward.

� Less pressure for an immediate response.

� Respondents� anonymity can be assured.

� Eliminate interviewer bias.

RESULTS

a) TAMBO PLAZA FINANCES TABLE @ 02/08/12

ID Description % work completed Amount paid % work

Outstanding Cost to complete

(Outstanding work)

1 P&G 40 3 456 682 60 5 108 068

2 Road works and Service Duct 45 4 662 665 55 9 234 460

3 Storm water drainage 48 4 014 090 52 4 255 310

4 Sewerage reticulation 67 6 172 225 33 3 563 735

5 200 Houses (40m2) 95 9 106 608 5 91 986

6 1100 Raft foundations 36 6 060 600 64 9 812 400

7 Platforms 38 1 248 575 62 2 248 425

8 Temporary housing 100 3 052 899 0 0

9 Security houses �temporary houses n/a 596 638 n/a 749 162

10 Add. Work � housing � water tanks, wash hand basin, bag wash in/out 100 475 200 0 0

11 Retaining walls � geolok �based on 15m2/platform and 60% of 1300no. platforms 0 0 100 11 466 000

12 Sewer pipe bridge 20 61 600 80 140 700

13 Water reticulation 30 2 079 888 70 5 267 551

14 M O S @ 80% n/a 451 251 n/a 0

TOTALS 41 438 921 51 937 797

93 376 718

b) Completion Programme for the Tambo Plaza Housing Development Programme:

SEE ANNEXURE A

CONCLUSION

The initial scope of works of this project was servicing 1050 sites with the changes it went up to 1509 sites, which is 44% more than tendered.

The advantages and disadvantages of this project have been considered as follows:

Advantages

� This project is aimed at bringing good quality living standards to a disadvantaged community

� Poverty alleviation

� Job creation

� Skills transfer

Disadvantages

� Applications for more funding from government officials are a lengthy process.

� Moving of people to temporal housing settlements whereas there is no set plan as to how long it will take for them to move into their new RDP houses that are intended on offering better living standards.

Poor planning, limited access to working areas due to obstructions on the way of services, limited design and drawings, political interference and lack of funds lead to the constraints and downfall of this project.

Local structures to set up workshops to educate the beneficiaries of the informal settlement projects as this poses to be a long term problem which may even see the total failure of services.