Quantiative Methodology for Determination of Cost Contingency in International Projects

Date

2007-01-01

Author

Sönmez, Rifat
Birgönül, Mustafa Talat

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This paper presents a quantitative methodology to determine financial impacts of the risk factors during the bidding stages of international construction projects. Project and country data of 26 construction projects from 21 countries were collected for evaluation of the international risk factors. The factors impacting cost contingency were identified using correlation and regression analysis techniques. The results indicated that four factors had major contributions for explaining the variations in the contingency levels. A regression model including the significant factors was developed to support bidding contingency decisions. The methodology presented provides a robust and practical statistical approach for determination of contingency by focusing on important risk factors. Details regarding model development and validation are presented along with a discussion on study limitations.

Subject Keywords

Management Science and Operations Research, General Engineering, Strategy and Management, Industrial relations

URI

https://hdl.handle.net/11511/34995

Journal

Journal Of Management In Engineering

DOI

https://doi.org/10.1061/(asce)0742-597x(2007)23:1(35)

Collections

Department of Civil Engineering, Article

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Citation Formats

R. Sönmez and M. T. Birgönül, “Quantiative Methodology for Determination of Cost Contingency in International Projects,” Journal Of Management In Engineering, pp. 35–39, 2007, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/34995.