FACTORS AFFECTING THE DELAY OF PROJECT IMPLEMENTATION: THE CASE OF WEGAGEN BANK FINANCED PROJECTS

Abstract

Timely completion of projects within the predetermined schedule and cost haves a competitive advantage for all stakeholders involved under projects. Project implementation delay refers to the late completion of works compared to the pre-planned schedule. The study assumes, project implantation delay can be rectified and eased when major affecting variables are identified. With the aim of discovering these factors, the researcher identified variables based on different literatures and published materials and aims to filter out and investigate the effect of Project appraisal and approval process, Promoters change request, Project monitoring and follow-up, Project implementation, Project planning, External environment conditions versus project delay under selected Wegagen Bank s.co financed projects that founds at Corporate Head-office level. With the aim of assessing the effect of the mentioned factors, research hypothesis was formulated to explore major factors that affect project implementation. Therefore, the above mentioned variables identified to be independent variables and the dependent variable identified to be project delay. With the aim of testing the proposed hypothesis, the research identifies 75 projects through purposive sampling method and data collected from professionals under credit cluster namely from credit analysts, relationship managers and Loan workout officers. Primary Data were collected from selected credit professionals and the collected data analyzed using linear regression method. Following proper checking, coding and encoding of responses in to SPSS V.26 data analysis software The findings infer that there is a strong positive and significant relationship among all the mentioned factors namely; Project appraisal and approval process, Promoters change request, Project monitoring and follow-up, Project implementation, Project planning, External environment conditions and from these unfavorable variables, external environment condition founds to have the strongest influence on project completion delay. Furthermore, after checking indicated variables are free from collinearity or the level of collinearity is within acceptable range, the researcher conducts multiple regression test and results have shown if the bank control and manipulate these factors, the bank can reduce delays from reducing a minimal 17% delay in time up to 200+ percent reduction of delay time. Therefore, the bank shall take a due consideration under mentioned variables before rendering any type of project financing and the bank shall halt financing before adequate risk mitigation mechanism is in place.