Construction Technology and Management

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Analysis of Earthmoving Operation Using Discrete-Event Simulation
(Addis Ababa University, 2020-05) Yemane, Gebrezihier; Abraham, Assefa (PhD)
Earthmoving operations are a sizable and heavy portion of most civil construction projects. It includes cyclic work, expensive fleet, and a large volume of works. Earthmoving operations are difficult to plan and operate because of their operation complexity, uncertainty in the operation process, and environment. Due to this fact, and as the earthmoving operation process is cyclic, i.e., the events (activities) occur in a discretized manner. Therefore, Discrete-Event Simulation (DES) is found to be the most effective approach to analyze and model their improvement strategies for their operational performance. The main objective of this thesis is thus to analyze the current earthmoving operation practice, develop the DES model, and develop improvement strategies for the earthmoving operation production system. In this thesis, 421 field data instances were collected through observation from the sample road construction project. Out of this, 345 of the data instances were collected from the earthmoving operation process of selected materials. Simphony CYCLONE simulation software was used as a simulation tool. A detailed earthmoving operation simulation model with various adaptation (or scenarios) based on the types of loading equipment (loader and Excavator) and types of material (selected and crushed unbounded) is developed. The simulation experimentation and sensitivity analysis were performed to optimize production rates and resources' utilization levels of the earthmoving operation processes. Accordingly, in the case of selected material operation, assigning ten trucks, single dozer (stockpiling), Excavator, and dozer (spreading) is more effective in production rate and resource utilization. Besides, there is no significant difference in production rate and utilization of the resource between the overall and excluding the embankment work of retaining wall and box culverts of selected material. Additionally, in crushed unbounded material operation, assigning 27 trucks, two loaders, and a single grader is more effective.
Application of Multi-Criteria Decision-Making Based on Combined Analytic Hierarchy Process and Linear Programming as an Alternative for Project Selection: The Case of Ethiopian Road Authority Road Projects
(Addis Ababa University, 2022-06) Tewodros, Abere; Abraham, Assefa (PhD)
Resources are limited for pursuing and funding new projects hence the challenge is to prioritize, select and allocate optimally. Ethiopian public projects encountered challenges in selecting best projects, finishing in time and cost. The project selection methods commonly used are quantitative in nature and they lack to account for intangible factors which can affect the outcome of project appraisals. An integrated Analytic Hierarchy Process and Linear Programming model that considered both quantitative and qualitative factors in choosing capital project is presented. The combined model is applied in Ethiopian Roads Authority road projects with Planning and Development Commission and Ministry of Finance as prime stakeholders in project selections. Research surveys were conducted in those organizations and secondary documents were used for the analysis. The results indicated project characteristics, with 0.5 weight, were ranked higher than other criteria related to the firm characteristic and external factors with weights of 0.36 and 0.14 respectively. The most important project selection sub-criteria found to be profit, measure of worth, project risk, financial standing, and resources with the overall weight of 0.15, 0.13, 0.12, 0.10 and 0.09 respectively. Others are economic factors, experience, technical ability, size & complexity, duration, organization culture, environmental, location factors, social responsibility, and political factors with weights of 0.07, 0.07, 0.07, 0.06, 0.04, 0.03, 0.02, 0.02, 0.02, and 0.01 respectively. Four projects out of six total projects were selected to have the most use of resources under the available resource constraints. The study provides a simple framework that can be used by organizations to make these challenging decisions. The integrated model is recommended for its ability to capture all possible factors, optimality advantage and applicability in different situations with refining the selection criteria.
Assessing the Cause of Failure of SMM Construction Companies in Addis Ababa
(Addis Ababa University, 2019-05-17) Animut, Arega; Abraham, Assefa (PhD)
The importance of small, medium and micro enterprise contractors in Ethiopia has been recognized by many researchers and policymakers. The contribution of small contractors to the creation of jobs and to the alleviation of poverty has also been recognized by many developing countries including Ethiopia. However, these enterprises have got many problems which are causing failure in their business, especially in the construction industry. The main objective of this thesis is to assess the cause of failures that are facing on Small, Medium and Micro Enterprise (SMME) construction companies in Addis Ababa. The research used a questionnaire survey on 162 SMME construction companies and case studies to achieve the study objectives. The research was focused on organizational and economic- environmental related factors which were the cause of failure of these enterprises. The managerial, financial, expansion and information technology related factors were classified as organizational challenges while marketing, payment, regulation and policy related factors were studied as economic- environmental related factors. The research established that marketing factor is the most challenging factor which becomes the cause of failure of SMME construction companies in Addis Ababa. Next to marketing factor, another challenge which usually happens in SMME construction companies in Addis Ababa is a financial problem. This occurred due to late payment from the client and lack of working capital from an enterprise. According to research results, managerial, ethical, information- technology and government policy and regulation related factors were other challenges which has faced on SMME construction companies. The research has also suggested some recommendations for the concerning bodies, as they need to have an appropriate understanding about these factors in order to solve marketing, financial, managerial, ethical and government policy and regulation problems. These will assist SMME‘s to flourish and achieve their objectives of profit, growth and employment opportunities and also reduce poverty. Therefore, it is important for the government and nongovernmental organizations together to formulate their policies and strategies which makes easy to meet the goal of these enterprises.
Assessment of Facility Management Practices of Selected Public and Private Buildings in Addis Ababa
(Addis Ababa University, 2022-01) Abel, Tsegaye; Abraham, Assefa (PhD)
Facility Management studies and finds out a way to use a facility up to that pre-destined purpose by enhancing the efficiency and effectiveness without putting the facility in jeopardy. Facility Management has found popularity in different countries; since, its benefits are acknowledged by end users and owners of buildings. However existing buildings have a lot of shortage in providing appropriate services due to lack of proper facility management. This study has focused on facility management practice of public and private buildings and the services being given by facility management providing firms in Addis Ababa. Data for the study is collected in a case study approach from three distinct case studies and by interviewees and questionnaires to facility management firms, building owners and end uses of buildings. Based on the study, the current services being given by the existing facility management companies in Addis Ababa are of a property management type like security, maintenance, cleaning, and rental services. Furthermore, the research indicated that service being given by providers are in the early development stage; as the facility management practice is being operated by professionals with a very little facility management related background knowledge. In addition, it was found that most buildings don’t have either facility management firm by themselves as department or hire service providers. Accordingly, the practice of facility management is found on its infant stage but it is expected to boom due to its benefits during operational phase of a building. Accordingly, for the successful operation of a building in the city, development of facility management and improvement of existing facility management practices by end users and building owners are recommended. Furthermore, enhancement of technology aided practices by service providers and training of professional in the field of area are recommended.
An Assessment of The Role of Project Management Technical and Behavioral Competency in The Success Of Construction Projects in Ethiopia
(Addis Ababa University, 2020) Kifleyohannes, Daniel; Abraham, Assefa (PhD)
The objective of this research is to study the role of project management technical and behavioral competencies on project performance in the Ethiopian construction industry. The unique nature of the construction industry, coupled with challenges of global competitiveness, and changing regulatory requirements have created excessive demand for highly knowledgeable and competent project management. Project management is a philosophy and technique that allows users the maximum utilization of their potential with limited sources, together with the increase of profitability. Competency is capacities and attributes that project manager should possess to realize project aims and objectives. Effective project performance can be achieved with relating competency of an individual, requirement of the job and project environment. This study used a quantitative survey and it was design to examine the role of project management technical and behavioral competencies in project performance. This study employed stratified random sampling technique to distribute survey questionnaire to the contractors. The data and information collected through questionnaire survey was interpreted quantitatively. Findings indicate the role of project management technical and behavioral competencies is undeniable in the success of a project. Besides, technical competencies have a substantial effect on project performance. Projects meet their technical performance goals, efficiency of the project management effort, and projects meet their operational performance goals are perceived as successful projects. There is a moderate correlation between project management technical competencies and project success and strong relationship between project management behavioral competencies and project success. Though, lack of particular PM competencies has a significant impact on the projects performance. Since, both technological factor and ethical factors are the biggest challenge in Ethiopian construction industry, therefore it was recommended that the sector must have ways to overcome these challenges and all concerned stakeholders work intensively on remedial measures. Moreover, focus is needed to be given to professionals in the industry and different methods to develop competencies in addition to experience on site.
Building Performance Simulation in Design Phase: A Case for Construction Consultants in Addis Ababa
(Addis Ababa University, 2022-05) Michael, Teshome; Abraham, Assefa (PhD)
Building performance analysis at the design stage enables assessing the building's performance and the variables that influence it. Simulating the performance of a building by visualizing how the building will react in response to excitation in a virtual environment provides designers and respective stakeholders vital information in the decision-making of buildings. Nonetheless, a common practice in Ethiopia indicates that an emphasis is placed on how the building appears and is constructed in the project's design phase rather than how the building will accomplish its intended function and performance requirements. Despite the longevity of buildings, analysis of how the building will operate and perform its intended function is seldom. This research aims to study the existing practices of building performance simulation for buildings in the design stages for the case of consultants in the architecture, engineering, and construction industry of Addis Ababa. The research design employed a questionnaire as a data collection tool. It gathered information from consultants about their approach to design, their tools, use of building performance simulation tools, consideration of uncertainties in their design, and sustainability approaches. For further validation, semi-structured interviews and documentation reviews were used for the case study analysis. It is found that there is a disparity and underlying lack of understanding of building performance fundamentals and analysis methods. For existing simulation practices in building projects in Addis Ababa, it is found that local consultants do not do them. Moreover, with the infancy of BIM practices in the city’s consultants, capitalizing on the possible BIM-based building performance simulation of buildings is not foreseeable under current circumstances. As a result, this research recommends essential education and training regarding building performance to realize its potential in developing buildings with improved performance and applicable standards and rating systems for sustainability in the local context.
Challenges of Lower Grade Contractors In Addis Ababa
(Addis Ababa University, 2019-10) Biruk, Seyoum; Abraham, Assefa (PhD)
In the construction industry, contractors have many challenges on their progress and performance while on the other hand opportunities that lead them for success as well. The large contractors today could have once been small contractors and vice versa. The challenges faced specifically by lower grade contractors may determine their overall presence, involvement and functionality to a large scale. Since these lower grade contractors need to stay in the industry and actively perform in order to progress and develop, it is vital to identify the triggering and hindering factors and challenges that affect their progress, development and presence as a firm. This research helps to recognize the difficulties, challenges and factors revolving inside and around lower grade contractors. The research will also give good background information and what new small contractors should be aware of the industry‟s environment before they jump to enter into. The necessary measures and strategies to be taken to enable and capacitate these contractors are also been indicated.
Computer Aided Management of Construction Payment: For Clients with Multiple Building Projects
(Addis Ababa University, 2022-03) Alazare, Shiferaw; Abraham, Assefa (PhD)
Regular and on-time payment is critical for the successful completion of a construction project. However, the construction industry suffers from delayed payments due to an inefficient payment certification process. Payment delays affect material delivery, labor productivity, and project progress and induce financial and subsequent time claims. This study proposed the breakdown of contract conditions into a logic that can be converted into executable codes called smart contracts that are executed on a web-based application. The system uses a centralized database to store contract data and BOQ and a backend developed using PHP that integrates smart contracts to automate and control payment management. The web-based application was then tested using the data from three building projects and was found to be accurate, effective, and efficient. Aside from creating automated payment certificates the web-based application can check bill of quantities, update advance payment and performance guarantee amount and expiry dates, identify various contract limits, and provide documentation tools. The result of the study has shown that the use of smart contracts and web-based application facilitate automation, control, and follow-up of the payment management process for clients with multiple building projects.
Construction Industry Institute (CII) Best Practice of Contractors With Minimum Time & Cost Overruns in Ethiopian Road Authority Projects
(Addis Ababa University, 2021-12) Mebatsiyon, Alemu; Abraham, Assefa (PhD)
Roads form an integral part of any nation’s transportation network, and are widely accepted to contribute positively to the socioeconomic development. This fact has meant many nations, particularly developing ones invest heavily in their infrastructure. In Ethiopia, this role is played by the Ethiopian Road Authority (ERA), which is responsible for the construction and administration of federal roads. However, road projects general face time and cost overruns as highlighted by numerous previous works. While the sources of these inefficiencies have been studied in detail, little investigation has been done to discover the reasons for some projects exhibiting above average performance. In this research, the level of awareness and implementation of the Construction Industry Institute’s (CII) best practices, which have been shown to improve project performance, on selected best performing road projects. The thesis set out by first identifying the top performing projects, followed by the identification of best practices of contractors said performance among ERA projects which were completed between 2009 and 2019GC. A questionnaire was used to assess the uptake of CII construction best practices was distributed among top performing projects stakeholders, namely contractors, consultants, and client (ERA), their client. Respondents were also asked to rank factors which negatively affected project performance. The results showed that negative factors correlated strongly with evidence from the literature review and showed a lack of proper planning and management among all stakeholders. Respondents also indicated that they are aware of CII best practices and their impact on project performance. The results showed that support from top management, vertical alignment, having a set of shared goals, establishing trust, and have an interdependent relationship among stakeholders were very important to the successful completion of projects. This research recommends that work must be done in the implementation of best practices and increasing the level of awareness among other industry members to improve sectoral performance, as their importance has been established in this research. This should be taken as a goal by the government and shall be incorporated in the curriculum. The use of best practices should also be extended to other construction industry sectors based on research similar to this.
Design Management Using Building Information Modeling: In Case of Projects in Addis Ababa
(Addis Ababa University, 2020) Betelhem, Tesfaye; Abraham, Assefa (PhD)
Design is a major part of a building project which must be planned and managed carefully. Design management aims to improve the design quality by creating managerial techniques. Poor design management contribute to poor design quality, less integration, poor communication, and frequent reworks. This impact will propagate throughout the project life cycle. Building information modeling is a methodology that provide integrated platform for designing which enable the multi-disciplinary working under a collaborative environment. BIM also known as a revolution in industry, many countries have adopted BIM based design process by understanding its benefits. This research objectives accordingly were focused on design management using BIM and assess the conventional design management practice of category one consultant within Addis Ababa. To achieve the above objectives the research design employed questionnaire survey and case study research which is descriptive type in nature. ICT park design project and ZIAS consulting firms’ projects are the case studies taken as a baseline to describe design management using BIM. Case studies were analyzed using structured interviews and document review. To assess the design management practice of category one consultant, questionnaire survey was also used as data collection tool. The major finding of this research is that even if BIM is not fully implemented in both case studies, design management process has been improved through better communication and collaboration, visualization, design coordination and included constructability and maintainability concepts have been observed from the case studies. In the meanwhile, both case studies have been confronted with infrastructure, software interoperability, lack of expertise in the field and process-based challenges. Besides that, the research also indicated that traditional design management have gaps and challenges in improving the industry. As a result, the research recommends the adoption of BIM as it improves the current design management of consultants in Ethiopia.
Determining Optimum Cost Contingency for Road Construction Project Using Monte Carlo Simulation: A Case of Access Road for Housing Projects
(Addis Ababa University, 2017-06) Christina, Abebe; Abraham, Assefa (PhD)
Road construction project is subjected to many substantial risks which affect the project cost and time. Most of the contractors and owners of such projects handle such risks by having a reserve budget which will be used for the instance called contingency. The practices of most of the project owners and contractors in determining the actual amount of cost contingency is by arbitrarily assigning a percentage values, mostly 10% to the total cost of the project. However, this reserve budget failed to achieve the objective of handling any uncertainties occurring during the courses of the project execution. Thus, this research aimed to determine realistic project cost contingency percentage for each work package by taking ten different access road construction projects containing thirty work packages found to be common for all projects. The research used three different probability distribution functions to model the variation of unit costs from project to project. Then, these probability distribution functions are used to run a Monte Carlo simulation for estimating the probability of occurrence of cost overrun and percentage deviation. The results of the study revealed that arbitrary assignment of project cost contingency to the total project cost is not feasible and inappropriate. Moreover, the result indicates different work packages have different uncertainties and the respective cost contingency varies from 0 – 35%.
Developing Activity Construction Labor Productivity Model: A Case Study on Meles Zenawi Leadership Academy Construction Project
(Addis Ababa University, 2020) Birhanu, Goshu; Abraham, Assefa (PhD)
Productivity is an influential variable showing the economics of production activities. Higher productivity levels imply increased profitability and the ability to pay higher wages to workers. In the Ethiopian building industry, construction labor productivity loss is one of the severe problems. Since labor is more flexible and volatile than other project-cost components, it’s necessary to understand the effects of the labor situation, which exist in the construction site and identify problem area that causes delay. To deal with this challenge, the study presents the methodology for the development of activity construction labor productivity models. To attain this objective, the subsequent procedures were followed: identifying seven process parameters that influence construction labor productivity, determine the observation method, determination of the minimum number of observations for study. The research conducted extensive field data collection from Meles Zenawi leadership academy construction projects in Addis Ababa covering a period of 4-months; and documented information using work sampling studies, foreman delay surveys, craftsman questionnaires, and productivity measurements. The validity of the data was tested to establish a 95 % confidence level. This helps to know errors that can be encounter during observation and hence, increase the reliability of data. A multivariable linear regression model for formwork, reinforcement, and concreting activities was developed to predict construction labor productivity. However, the models for concreting and reinforcement activity were limited to predict construction labor productivity. Travel, waiting and material handling for column formwork activities predict construction labor with a high degree of accuracy of 95.81% and R-square value of 98.5%. This indicates that the relationship between independent variables (travel, waiting, and material handling activity) and construction labor productivity of the developed models is good and the predicted construction labor productivity values fit with the real-life data. Overall significance tests and scatters plots were conducted to see the relationship between direct work and construction labor productivity. The result proves that direct work activity was not significantly correlated with construction labor productivity. Unavailability of material, poor site layout, crew failure to follow instructions, incomplete drawings, the low skill level of crew, waiting for other crews, and tools were the main causes of delay in the study area.
The Effect of Birr Devaluation on Public Building Construction, Case Study on Sub-City Office Building Projects in Addis Ababa
(AAU, 2018-06) Ameha, Zewde; Abraham, Assefa (PhD)
On October 2017 the Central Bank of Ethiopia devaluated Birr by 15% against US dollar. Since the devaluation occurred, the price of construction materials in the country has been sharply increasing. As a result, the construction sector is facing a range of obstacles. But he extent to which the impact of devaluation has on the construction industry is not a wellstudied area. Initiated by this fact, this research investigates the effect of devaluation on public construction projects that were commenced before the devaluation occurred. It also focuses on how the risk was managed after devaluation took place. The research investigates the extent to which devaluation affects ongoing public construction projects regarding increasing cost, time overrun and project scope. This study contributes to the discourse by revealing the level of impact that economic decisions have in the construction industry in Ethiopia. The research uses case study approach to understand the effect of devaluation on public construction projects, more specifically on Sub-city office building construction projects. In order to measure the effect of devaluation on the projects, contract documents, monthly progress reports and material Performa of different periods concerning market prices used by the construction company are critically investigated. In conclusion, having investigated that high inflation rate, volatile market price, shortage of some materials and shortage of currency are the major effects of devaluation made on public building construction projects. This unfortunate economic event, have resulted high price escalation and delays on the projects.
Enhancing Labor Productivity of Selected Building Construction Operations Using Value Stream Mapping Integrated with Discrete Event Simulation
(Addis Ababa University, 2020) Tsion, Assefa; Abraham, Assefa (PhD)
As a consequence of traditional managerial concepts, construction is characterized by a high share of non-value-adding activities (NVAA) and resultant low productivity. Labor productivity growth in the construction industry has averaged only 1% per year in the past 20 to 30 years. Likewise, the labor productivity of the Ethiopian construction industry is at the lowest level. This research offsets with the objective of measuring the level of NVAA and identifying their root causes using value stream mapping (VSM). Then it strives to enhance labor productivity by the application of lean concepts and principles using VSM integrated with discrete event simulation (DES). Two case studies’, slab rebar and HCB operations, were selected and data were collected by observing the elapsed time of each sub-process and interviewing the manpower involved in the project. The developed VSM were used to analyze and measure the NVAA in the operations and propose the relevant lean concepts and principles. Subsequently, it was used to produce DES models in a detailed manner for the current state maps and exploration of different optimization scenarios. The research outcome has revealed that 99.96 % and 99.7% of the slab rebar and HCB operations are constituted by NVAA, respectively. Moreover, from the current state VSM, the existence of a vicious circle of wastes has been witnessed and root causes related to the perspective of material and methods comprised the huge share. Workplace organization/ standardization (WOS), production scheduling (PS), and optimization of labor resources were found to be the most pertinent principles for both operations. The assessment of the scenarios using DES showed that labor productivity could be enhanced by 36.3 % and 34.6% for slab rebar and HCB operations, respectively. Correspondingly, the lead time improved by 95.9% and 49% for slab rebar and HCB operations. Finally, this research principally recommends project participants to give due attention to the flow dimension of construction and to identify and eliminate NVAA using VSM. Moreover, to adopt WOS, PS, and optimization of labor resources principles to enhance labor productivity and to integrate DES to comprehend the efficacy of the applied concepts and principles.
Experience of Output and Performance Based Road Contracting System In Developing Countries and Future Prospects in Ethiopian Federal Road Construction
(Addis Ababa University, 2019-07) Addishiwot, Tadesse; Abraham, Assefa (PhD)
The government of Ethiopia has given significant attention to the road sector considering its immense impact on the socio-economic development of the country as road transport reaches the majority of the people. In this respect, the Ethiopian Roads Authority (ERA) is mainly responsible for the construction and maintenance of federal road networks of the country. The road maintenance and construction practice of ERA is predominantly based on the conventional method of quantity and unit rate based contracts by which several works are planned and carried out. The government has faced problems in maintaining the serviceability of road infrastructure systems by using these traditional methods of contracting. However, in recent years other alternative contracting methods are attempted including output and performance based road contracting (OPRC) in the Ethiopian road sector. These types of procurement methods have a substantial success records in many developed and developing countries. Nonetheless, taking the long term nature of the contract into account, OPRC projects require careful planning and capacity from the contracting authority and the contractor to implement it successfully. In the traditional approaches of project delivery systems, after the Contractor hands over the project any failures arising out of design or execution are the headaches of the Employer/Government and heavy costs are spent on the rehabilitation and maintenance of roads that doesn't serve the expected life. In order to tackle the above mentioned shortcomings of the traditional approaches of project delivery systems, other alternative project delivery systems that account the serviceability and usability of the road becomes critical. One of the project delivery systems that is being used by different countries and now initiated for implementation in our country (for Nekemte - Bure Road Project with its three lots) as a pilot project is OPRC (Output and Performance based Road Contract) which is believed to address the design, improvement works/construction and management and maintenance services in one package. This research tries to study the specific characteristics/features, advantages and disadvantages of this type of project delivery system from different stakeholder’s perspective, study the experience of other countries, and evaluate the contract and performance to date and encountered challenges of the newly initiated projects in our country by benchmarking other countries experiences and forward recommendation for further implementation for Ethiopian Federal Road Projects.
A Factor Model to Predict the Construction Labour Productivity in Building Project: A Case Study of Meles Zenawi Leadership Academy Construction
(Addis Ababa University, 2019-03) Kwizera, Arnaud; Abraham, Assefa (PhD)
In the construction industry, labor productivity is a key variable in the profitability of a construction project. The most challenging issue for planning a construction project is predicting the construction labor productivity (CLP) because it is affected with many factors that are objective and subjective ranging from internal to external. Based on review of the literatures, several research on CLP have been done in the past; however, a deeper understanding is still needed to control the construction labor productivity because parameters (factors and practices) influencing construction labor productivity are multifaceted and project dependent. In an attempt to predict CLP in construction projects, this research aims to identify, classify and quantify parameters (factors and practices) influencing the CLP of concrete placement, Rebar and formwork using a case study at the construction of the Meles Zenawi leadership academy situated at Goro by developing a multiple regression model .In this paper, the effective factors that affect the CLP were taken from a large literature review and 20 factors were classified into Management, Labor/human, technological and external termed based on the findings . In total, 222 data points have been collected for a period of two months on both daily and weekly basis. Multiple regression models have been developed for each activity. The slab formwork, column formwork, lift formwork and rebaring presented significant models with a coefficient of determination of 77.6%, 47.0%, 82.6% and 82.7%, respectively. In slab formwork activity, the study results indicated that increased crew size and complexity of the task decrease the CLP. In column formwork, the increase in level of interruption and disruption, crew size, working conditions and temperature will tend to lower the CLP, while the increase in the skills of labor and will increase the CLP. In lift formwork, the model shows that the increase in crew size, shortage of materials will decrease the CLP, whereas the increase in the crew experience and skills labor will increase it. For the rebaring activity the increase in skilled labor and clarity of technical specifications will considerably increase the CLP. In the study, the improvement strategies are also discussed.
Financial Performance Evaluation and Distress Prediction model of Selected Grade One Building Contractors
(Addis Ababa University, 2019-07-09) Eyobed, Miriye; Abraham, Assefa (PhD)
One of the main problem for evaluation of financial performance of Ethiopian construction industry participants are accepting high working capital and revenue for the lowest bid. But it does not guarantee for the performance of a construction company. This is reason why the study sets main objective to compare and examine the performance and distress of selected grade one building contractors in Ethiopia. As part of the approach to achieve this objective, the study first developed industry average through desk study to evaluate the selected Grade-1 building contractor’s financial performance. It identified by liquidity, profitability, operational efficiency and solvency ratios. Then the study used the concept associated with these basic pillars, both to notify the analysis and serve as a reference against which the selected grade one contractor’s financial ratios are compared. The study adopted case study research methodology whereby five Grade 1 building contractors that are registered under the Ministry of Urban Development, Housing and Construction are taken as case in point. Moreover, the researcher requires that the financial statements submitted by private companies comply with Generally Accepted Accounting Principles (GAAP). And the accessibility of accounting statements has taken as a criterion. It employed data collected from documents and through interviews. Based on this, a detailed analysis has been conducted to indicate construction firm’s performance using Return on Asset (ROA) and Return on Equity (ROE) as a dependent variable and Altman Z Score, Gross Profit Margin Ration (GPMR), and Total Debt to Equity Ratio are as independent variables. The study found out that Altman Z-Score distress prediction model was found to have the highest accuracy in predicting the distresses of the studied construction firms among the others prediction models (Springate and Zmijewski models). As a result, the outcomes of the correlation coefficient analysis, and ANOVA F-test in multiple regression analysis, the following conclusions were made: 1) The correlation analysis indicates that Altman Z score and GPMR have a positive relationship with both of ROA and ROE, while the Debt to Equity ratio has a negative relationship with ROA and a positive relationship with ROE; 2) The regression results show that, financial distress has a significant impact to the firm’s financial performance; 3) Financial performance prediction model results show that Altman-Z Score is robust in explaining both ROE and ROA. While, the majority of the firm’s profit has been generated by debt, ROE will no longer used as an indicator of financial performance. Therefore, a crucial implication of the findings is the trend of application of liquidity, profitability, operational efficiency, solvency ratios and Altman-Z Score as a financial performance indicator is often underestimated. Related to this, incorporation with its counterparts in developed and developing countries, the environment under which selected grade one construction companies are obtained financial performance evaluation and distress prediction is quite considered.
Hypothetical Modeling of Contractor’s Bid Markup Estimation for Road Construction Projects in Ethiopia
(Addis Ababa University, 2020-03) Ameneshewa, Alemu; Abraham, Assefa (PhD)
Markup is a factor that estimators apply to certain work activities or to the total cost of a bid to cover general overhead and profit. Estimating markup is an important decision for contractors as its size has to be low enough to win a contract, but high enough to make a profit. Studies which are done on cost estimation practice in Ethiopian construction industry agree in the need for a change in the current practice of bid markup estimation. But these studies have a gap in introducing a systematic tool for solving the problem. This research focuses on identifying and analyzing factors affecting bid markup in road projects and developing a model which will support local contractors’ decision in estimating bid markup size for road construction projects. The research uses integrated review of various literatures and questionnaire survey as data collection methods. Twenty-one factors that are considered to affect bid markup have been identified from literature review. Based on the results of the analysis, it appears that ‘complexity of project’, ‘number of competitors with strong desire to win a project’, ‘project location (region)’, ‘immediate need for work’ and ‘security need of project location’, are the top five ranked factors in terms of influencing bid markup size. Multiple linear regression (MLR) and artificial neural network (ANN) were selected for modeling bid markup estimation. The developed MLR equation contains eleven factors based on stepwise regression technique. The coefficient of correlation (R) was obtained as 0.882 with adjusted value of coefficient of determination (R ) = 0.745. The overall regression model was statistically significant, F (11, 73) = 23.297, p< 0.05. For developing the ANN model, various network structures were generated and tested. The most satisfactory model was the ANN8, which consists of 8 neurons in the hidden layer with R, R 2 2 , MAPE and RMSE values of 92.06%, 84.75%, 6.43% and 2.47 respectively. Cross validation for both models was done and satisfactory result was obtained. Statistical performance indicators shows that the ANN method of modeling predicts bid markup better than MLR method. But, the obtained values of the statistical performance indicators for the two models are closer to each other. Thus, both models can be considered as a satisfactory prediction tools for bid markup and can provide a starting point for estimators in a given road project bid markup estimation task.
Identification and Comparative Analysis of Key Parameters Influencing Construction labour productivity of Building Projects in Addis Ababa
(Addis Ababa University, 2019-06) Yared, Beyene; Abraham, Assefa (PhD)
Construction labour productivity (CLP) is dominant subject matter in the construction sector; essential cost savings and efficient usage of resources are achieved through high level of labour productivity. CLP is influenced by various factors and practices (parameters) which are multifaced and project dependent. Various studies have been performed to determine the parameters that influence the CLP in developed countries, but much has not been done in the developing countries. As a result, this study focuses on the identification of the key parameters influencing CLP from micro to macro level in building projects in Addis Ababa. The study relies on survey data collected to project managements and trade workers’ respondents from building constructions in Addis Ababa. Respondents from 14 different grade I contractors which are actively engaged in building construction in Addis Ababa were involved in data collection process. A total of 100 surveys, 42 from the project managements and 58 from the trade group, have been collected. The results from the study have shown that ―National‖, ―Engineering‖ & ―Project Complexity‖ from the PM survey and ―Location Property‖, ―Equipment & Tools‖ & ―Materials and Consumables‖ from the trade survey categories have been ranked from first to third respectively as negatively influencing categories. Whereas ―Foreman Related‖, ―Labour and Crew Related‖ and ―Project Management Practices‖ from the PM survey and ―Foreman Related‖, ―Labour and Crew Related‖ and ―Equipments and Tools‖ from the trade survey have been ranked from first to third respectively as positively influencing categories. The identified top three parameters in negatively influencing CLP are ―Public unrest due to political, economical or other issues‖, ―There is high inflation rate in Ethiopia‖ & ―Drawings and specifications are often not complete and require updates‖ from the PM survey respectively and ―Remunerations (salary, benefits) are satisfactory‖, ―Remuneration (salary, bonus and incentives) are fairly set‖ & ―Materials are not delivered on time to task location‖ from the trade survey respectively. Whereas the identified top three positively influencing parameters are ―Ethiopia has more young population‖, ―Work operation strategies and system increase performance of the organization‖, ―Clear goals are given to foreman and crafts‖ from the PM survey respectively and ―There is a really good cooperation between craftsmen in a crew‖, ―Craftsmen use alcohol and drugs during work hours‖, ―Foreman has the required experience‖ from the trade survey respectively. The result from the perspective difference analysis have shown that ―There is a shortage of good transportation equipment (cranes, forklifts)‖, ―Available drawings and specifications are not readable‖, ―Materials are not delivered on time to task location‖ have been the top three parameters showing difference in perspective between the two survey groups in negatively influencing parameters. Whereas ―Crew is experienced and has the necessary competence‖, ―Craftsmen trust in the skills and judgment of their supervisors‖ and ―There is a really good cooperation between craftsmen in a crew‖ have been the top three in positively influencing parameters showing difference in perspective.
Identification of Factors Affecting Bid No Bid Decision for Construction Projects in Addis Ababa and Developing Decision Model Using Fuzzy Rule -Based System
(Addis Ababa University, 2021-07) Meron, Wolde; Abraham, Assefa (PhD)
The main way of acquiring a job for a construction company is through competitive bid. Most of the time, bid invitations float for a short period of time and are seasonal. This activity is critical as it is done frequently, quickly, and intuitively. For a construction company, the decision to participate in a bid has to be done wisely. This decision is influenced by different factors and it varies with different background. In related to this, current research has been done to study the factors affecting bid decision as well as develop model. The purpose of this research paper was to identify factors and examine which of these factors had a relationship with the decision to bid or not to bid. The research results show that prequalification requirements have a significant relation with the decision to not bid or bid and the other factors include turn over requirements, ability to do the job, project tie with company future , future projects, overall economy (availability of work), past experience in managing similar projects and market conditions (stability of material prices). The decision support model was developed using multi-variable regression and the Fuzzy Rule-Based (FRB) System. For the FRB model, the C-means clustering technique is applied for generating membership function and rule base. The Data driven fuzzy rule base system model has been selected as the Mamdani or Linear Sugeno type having 38 rules, 14 inputs and 1 output structure and showed an R2 value of 85. Multiple linear regressions resulted in having a 3 variable model using a stepwise approach with an R2 value of 69and was a good fit. It has been established that for c

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