ASSESSMENT OF THE CAUSES AND IMPACTS OF CLAIM IN BUILDING CONSTRUCTION PROJECT MANAGEMENT OF LOCAL CONTRACTORS: THE CASE OF COMMERCIAL BANK OF ETHIOPIA IN ADDIS ABABA CITY

Abstract

The purpose of this study is to assess the project management practices in causes and effect of claim in Commercial Bank of Ethiopia building construction Office. On this study a descriptive case study design was adopted. While the sampling technique is quota sampling technique, Participants of the study are all project management team members of the organization, contractor and consultants that have been involved on different projects owned by the organization and data is collected through interview, and questionnaires. The analysis is done qualitatively by relating the results with literatures and quantitatively using percentage, frequency and mean. For the mean value the researcher adopted previous literature style in order to categorize the mean value. The findings of the study revealed that among knowledge area assessment almost all of them are at low level of mean value except project quality management. In light of other knowledge areas the organization perform project quality management in a better way. The main objective of this study is to assess the main causes and effect of clam and how it could be mitigated or reduced or even avoiding claim in building construction projects. Lack of suitable project management methodology, interference and late decision making by the top managements and lack of project management practices are the major challenges that the organization face during the assessment. Therefore, to alleviate these prevailing implementation challenges the organization should adopt a standard Project Management (PM) methodology for its projects, decision on basic matters on time that hardly affects the project progress, diversify funding partners, and conduct need assessment of beneficiaries. To conclude the main reason for claim in project construction management is poor site coordination. The main internal factors that lead to price escalation in CBE were found to be engineering and construction complexities, lack of proper procurement methods, unclear contract terms, project schedule changes and inaccurate estimation, the high global demand for construction materials, focal concerns and requirements and currency change rate fluctuation are found to be major external factors. The main impact of claim in CBE are design and work order changes, to prevent this, its suggested that any design ,schedule and other issues should be specified in the contract before the project begins to ensure a clear understanding between the parties.