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Rework in Urban Renewal Projects
Rework in Urban Renewal Projects
Abstract: There is a paucity of systematic knowledge on the dynamics of rework in urban renewal projects even though such projects
frequently exceed budget and schedule. The causal factors of rework and cost impact on 69 Colombian public projects are examined.
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The nomenclature of project, organization, and people (POP) is used to categorize causal variables and develop a generic systemic model
of rework causation. Inadequate initial budgets, poor project design (which instigated changes during construction), and the social inclu-
sivity of contracts in Colombia (which employ local inexperienced people to conduct the required work) were the most significant con-
tributors of rework. The developed model provides decision makers and stakeholders with insights about the interdependencies and behavior
between key influencing variables in Colombian urban renewal projects, and can be used to stimulate learning and process improvements in
future projects. DOI: 10.1061/(ASCE)IS.1943-555X.0000332. © 2016 American Society of Civil Engineers.
Author keywords: Colombia; Public urbanization projects; Rework; System dynamics.
provement. The paper commences with a description of the case the administration (e.g., contract information and payment orders)
study (including the data collection methods that were used) before and unstructured interviews with project team members (e.g., cli-
presenting the nomenclature for rework causation. This nomencla- ent’s representative, contractor, site managers, and subcontractors)
ture is then used to analyze the rework causation and develop the represented primary sources of information for determining both
dynamics of rework in the provided case study. Results are then the causes and costs of rework experienced. Once a rework event
discussed and conclusions are drawn. was identified, all respective parties involved with identification
and rectification were interviewed to elicit a balanced view of the
event. Interview data and narratives were then transcribed and given
Research Approach to the interviewee to check for any discrepancies that may have
arisen.
A case study should investigate the technical aspects of a contem-
porary phenomenon within a real life context, particularly in critical
and unique circumstances (Yin 1984). It is particularly useful when Data Analysis
the boundaries between phenomenon and context are difficult
to ascertain and when multiple sources of evidence are used (Yin The interview narratives and textual content obtained from secon-
1984). A case study provides analytical rather than pure statistical dary documentation were then analyzed using the NVivo 9 soft-
generalizations and can capture the complexity and dynamism of ware. This software has the inherent capability to organize and
organizational settings in projects (Flyvbjerg 2006). For these rea- analyze unstructured qualitative information, words, and concepts
sons, this research adopts a case study approach to examine under- with powerful processes of indexing and theorizing. This enabled
lying dynamics that contribute to rework in urban renewal projects. the research team to quantify and analyze the presence, meanings,
and relationships of words and concepts, as well as draw inferences
about the messages contained within the texts. It also enabled addi-
Case Background tional data sources such as web pages and journal notes to be
Urban renewal projects in the city of Medellín, Colombia, within incorporated into the analysis in the pursuit of identifying new
the PBP provide the paper’s case study setting. These projects emergent themes. NVivo 9 facilitated an organic approach to
include the construction of sidewalks, curbs, stairways, supply and coding by enabling triggers or categories of textural interest to be
installation of road protections, handrails, and complementary coded and used to monitor emerging and developing ideas (Kvale
works in different parts of the district. A traditional lump sum con- 1996). This coding can be modified, integrated, or migrated as the
tract was employed where the Secretaría de Obras Públicas acted as analysis progresses and facilitates the recognition of conflicts and
the contracting party for all projects. The initial contract value was contradictions (Morse and Richards 2002). Coding was undertaken
COL$486,431,898 [Colombian peso (1€ ¼ COL$2,500)] and the systematically to ensure all data was treated equally. As an initial
initial contract duration was 120 days; this included 49 projects step, all interview transcripts were read in their entirety and notes
within 17 districts. However, the contract grew to finally encom- made by members of the research team. These initial notes were
pass 69 small independent subprojects within 21 geographical dis- used to formulate categories, connect themes, and help develop
tricts of the city. Hence, the revised contract value was increased to contextual relationships between themes.
COL$717,310,539 and the contract duration to 180 days. The analysis commenced by examining themes associated with
Despite being a single contract, each district was independent in change, error, cost, and mistakes. Using an in-built function within
terms of budget allocation and could not transfer funds to other NVivo 9, words with similar meanings such as “mistake” and
districts. Similarly, there was neither a specific planning policy “error” were identified in selected materials (sources). This func-
for the execution of works nor a sequence of order for the projects. tionality enabled the research team to maneuver from one data
There was a global milestone for the execution of the entire pro- source to the next using features called doc links, node links, and
gram of works, but no independent milestones individual projects. data links. The process adopted involved creating nodes to mark
Fig. 1 presents areas of the city prior to the commencement of con- relevant concepts and topics in text documents that were sub-
struction works. sequently searched and analyzed. The analysis revealed that a high
degree of interdependency existed between perceived rework sour-
ces. This resulted in the nomenclature of project, organization, and
Data Collection
people (POP) to be adopted akin to previous research conducted by
The research team acted as nonparticipant observers throughout the Love et al. (2012) and Forcada et al. (2014), where the following
duration of on-site data collection, which commenced from the elements were found:
construction phase. The team also utilized their industrial experi- • Project includes scope definition, wrong initial budget, lack or
ence to identify rework events that occurred while inspecting his- inadequate design, deterioration of the site regarding natural
torical contract documentation such as site instructions, change accidents, pressure to start work(s) execution, lack of clarity
order requests, requests for information, and drawing changes. of citizen needs and specifications, type of procurement path,
Fig. 1. Examples of different areas of the city before carrying out the works (images by Angela P. Alvarez): (a) retaining wall; (b) pavement;
(c) sidewalks; (d) retaining wall; (e) installation of road protections; (f) stairways
vandalism, climatic conditions and specifically inclement Table 1 presents an example of the description of incidences that
weather, and interferences with existing public services; occurred.
• Organization includes lack of supervision, design changes, un- From the analysis of rework incidences a taxonomy of causes
expected events, inadequate quality of execution, slow client re- based on POP was developed and is presented in Table 2. The POP
solution, inadequate budget management, third party problems, taxonomy enabled common factors contributing to rework to be
and inadequate resources management; and identified prior to further examining each subproject. The common
• People involved have a lack of experience and expertise, and significant factors influencing rework were identified as
stress. • Wrong initial budget: Poor documentation and technical de-
signs/specifications that were based solely on the district re-
presentative’s request (without on-site technical inspection and
Rework Causation validation) brought many scope and budget modifications. For
example, excavations with significant slope did not include a
The selected projects experienced significant cost variations be- retaining wall. These extra works significantly increased con-
cause of changes, errors, and omissions, which resulted in rework struction costs and delayed the program of works. Many of these
occurrence. Despite its presence, rework was not formally mea- rework events could be directly attributed to the district repre-
sured or acknowledged as there was a negative perception that sentative’s slow acceptance of changes, absence of technical site
admission would damage the contractor’s corporate reputation. visits, necessity of ordering new materials, and subsequent em-
However, the administration was curious to know why and how ployment of specialized staff for the works. Other consequences
project rework arose. Through direct observation and subsequent of an inaccurate initial budget were uncertainty and stress due
analysis of interviews and documentation, the incidences and their to constant changes and new situations, a significant increase of
causes, description, budget, and cost modifications were detailed. work with the available resources, and overall confusion for the
Exact location of the platform had to Lack or inadequate design Only general details were Client — —
be decided on site received
Execution delays Lack or inadequate design Lack of works and procedure End users 3 —
definition (community)
Lack of experience Workers did not know how to Contractor — —
carry out the work
Site managers requested changing the Lack of clarity Lack of communication between Client 1 —
design parties
Low efficiency Type of contract Workers did not know how to Client — —
carry out the work
Stress Due to scope changes, errors and Contractor
unexpected events
termination of works. This situation could have been avoided concerning the lack of works precision and led to repairs, scope
with the provision of accurate information design; changes, rework, and delays; and
• Lack of design or inadequate design: Poor initial documentation • Unviable works: Unviable works appeared when a project or
created constant delays during construction works because of an activity could not be performed according to the contract
a lack of design clarity and supporting technical advice; the cli- content because of errors in the design documentation or a lack
ent’s inability to reach resolution on design changes further ex- of resources allocated to that activity or project. Some designs
acerbated these problems. For example, project commencement were developed only with the request forms provided by the
was delayed by 10 days because the client had not approved key district’s representative without ensuring the real location and
information; situation of the site. Consequently, many errors appeared in the
• Scope definition: Scope changes were closely related to poor contract documentation. Several unviable projects were then re-
design documentation and erroneous initial budget calculations; defined or replaced for other necessary works in the district.
• Type of contract: The inherent degree of uncertainty within the It was identified that initial budgetary plans were a primary
scope of projects under PBP, and in general for an urban im- cause of rework, perhaps because of issues to optimism bias. A
provement project, created a problematic issue (Alessandri et al. detailed analysis of such costs within each project was carried out.
2004). The absence of detailed project design, inadequate allo- Table 3 presents a summary of analysis disaggregated by district
cation of budget, and bureaucratic indecisions prior to, or during and includes awarded budget, corrected budget (awarded budget
construction may lead to cost and schedule increases (Love et al. modified and adapted to the work to be completed), rework costs
2013). The obligation to seek permission via community socia- because of unexpected events, rework costs because of scope mod-
lization meetings before commencing (or changing) the works ifications by the client, and final executed budget.
together with the requirement to hire 80% of unskilled labor Because many inconsistences between the design and what was
from the district’s citizens, were identified as contributing to actually documented were found (with the aim to analyze the real
rework; costs of rework), the budget was recalculated to produce a corrected
• Inadequate economic solvency and inadequate budget manage- one that accommodated actual work undertaken.
ment: The contractor’s poor financial position was aggravated On average, the awarded budget was 28% higher than the cor-
by inadequate budgetary management when allocating material rected budget, illustrating that the budget was inflated. Had a de-
and equipment resources among the various projects. In turn, tailed analysis of work activities been carried out during the design
resources shortages occurred, which result in rework and delays; process this aforementioned inflation could have been avoided. It is
• Weather conditions: High temperatures and sporadic torrential estimated that tighter budgetary control and a detailed design at the
rains caused the temporary suspension of some work. Such in- outset of project inception could have saved COL$153,653,978.
cidents could only be classified under the heading of force ma- Yet, the contract did not allocate any contingency for schedule
jeure but better planning would reduce the impact of inclement or cost overruns. In fact, the final executed budget was COL
weather; $3,224,875 less than the awarded budget primarily because one
• Lack of experience: Workers’ inexperience and incompetence project was not carried out. Hence, when comparing the final
resulted in substandard quality works such as mixing incorrect executed budget to the awarded budget there is no cost increase.
proportions of grouting materials; failing to determining the cor- However, many budget modifications and budget exchanges were
rect thickness of concrete; and failing to ensure that surfaces made between projects from the same district, seeking not to over-
were even, level, and smooth (as per contractual specifications). take the awarded budget. By comparing the final executed budget
Extreme pressure to complete works further exacerbated issues with the corrected budget, a 21.1% increase in the corrected budget
© ASCE
Wrong Lack or Pressure Lack Interferences Slow Inadequate Inadequate
Project Scope initial inadequate Deterioration to start of Type of Weather with existing Lack of Design Unexpected Inadequate client economic budget Lack of
number definition budget design of the site execution clarity contract Vandalism conditions services supervision changes events execution resolution solvency man. experience Stress
District 1
a a a a a a a
1 — — — — — — — — — — — —
a a a a a a a a a
2 — — — — — — — — — —
a a a
3 — — — — — — — — — — — — — — — —
a a a a a a
4 — — — — — — — — — — — — —
a
5 — — — — — — — — — — — — — — — — — —
a a a a a a a
6 — — — — — — — — — — — —
a a a
7 — — — — — — — — — — — — — — — —
District 2
a a a a a a
8 — — — — — — — — — — — — —
a a a a a a a a a
9 — — — — — — — — — —
a a a
10 — — — — — — — — — — — — — — — —
a
11 — — — — — — — — — — — — — — — — — —
District 3
a a a a a a
12 — — — — — — — — — — — — —
a a
13 — — — — — — — — — — — — — — — — —
a
14 and 69 — — — — — — — — — — — — — — — — — —
a a a a
15 — — — — — — — — — — — — — — —
a a a a a a a
68 — — — — — — — — — — — —
District 4
04016034-5
a a a a
16 — — — — — — — — — — — — — — —
District 5
a a a a a a a a a
17 — — — — — — — — — —
a
18 — — — — — — — — — — — — — — — — — —
J. Infrastruct. Syst.
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Table 2. (Continued.)
Project Organization People
© ASCE
Wrong Lack or Pressure Lack Interferences Slow Inadequate Inadequate
Project Scope initial inadequate Deterioration to start of Type of Weather with existing Lack of Design Unexpected Inadequate client economic budget Lack of
number definition budget design of the site execution clarity contract Vandalism conditions services supervision changes events execution resolution solvency man. experience Stress
District 9
a a a a a a a a
33 — — — — — — — — — — —
District 10
a a
34 — — — — — — — — — — — — — — — — —
District 11
a a a a a a a a
35 — — — — — — — — — — —
a a a a a a a a a a a
36 — — — — — — — —
a a a
37 — — — — — — — — — — — — — — — —
a
38 — — — — — — — — — — — — — — — — — —
a a
39 — — — — — — — — — — — — — — — — —
District 12
a
40 — — — — — — — — — — — — — — — — — —
District 13
a a a a a a a
41 — — — — — — — — — — — —
District 14
a a a a a a
42 — — — — — — — — — — — — —
a
43 — — — — — — — — — — — — — — — — — —
a a a
44 — — — — — — — — — — — — — — — —
a
04016034-6
45 — — — — — — — — — — — — — — — — — —
District 15
a a a a a a a a
46 and 67 — — — — — — — — — — —
a
47 — — — — — — — — — — — — — — — — — —
J. Infrastruct. Syst.
experience Stress
was recorded and was attributed to scope changes that transpired as
—
—
—
—
—
—
—
cost and time overruns.
People The contributors of rework can be categorized into various
Lack of
—
—
—
—
—
—
dichotomous groups such as client related, design related, and con-
a
tractor related factors (Love and Edwards 2004). Rework costs be-
cause of execution errors and management problems were incurred
Slow Inadequate Inadequate
Weather with existing Lack of Design Unexpected Inadequate client economic budget
man.
by the contractor, while rework costs due to scope modifications
—
—
—
—
—
—
a
(client and design related factors) were incurred by the client
but had to be allocated in the awarded budget. The wrong initial
execution resolution solvency
—
awarded budget 28% higher than forecasted; constant modifica-
tions and scope changes created by a lack of design clarity and
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the client’s inability to reach timely resolution were the most im-
Organization
accounted for 4.6% of the project’s total cost. These costs were
—
—
—
—
—
—
—
—
—
a
District 21
—
It should be a cross and means that the specific project involve that rework factor.
—
—
—
a
Dynamics of Rework
Project
Pressure Lack
—
—
—
—
—
—
where a cause and effect relationship exists, while the plus or minus
definition budget design
—
—
—
—
—
—
initiate a series of dynamics that can provoke rework and thus cre-
ate substantial cost and schedule modifications (Forcada et al.
—
—
—
a
66
performance.
a
project brief to their requirements and effectively communicated eration and severity of its occurrence. Where more complex events
this brief to all contractual participants involved. The time to rectify are involved, the risk is traditionally defined as the summation of
any error can affect the work’s progress, require a costly design associated individual events, weighted according to the degree of
change and/or lead to unscheduled program overruns. Design errors importance of each individual event (Rescher 1983). In the context
identified during the construction phase are often the mostly costly of the research presented the identification of rework causation is
to rectify (Burati et al. 1992; Love and Li 2000; Love et al. 2008). understood by considering the whole project system holistically
Inconsistences between actual construction work and specifica- and how variables dynamically interact (Love and Edwards 2004;
tions contained in the contract documentation were an important Aljassmi and Han 2013; Li and Taylor 2014).
contributor to rework. In fact, scope uncertainty is an innate fea- Further research is required to identify the probability of occur-
ture of Colombian urban renewal projects under the PBP. During rence between the identified causal factors and rework levels (Love
this research, it emerged that the lack of technical visits by the and Edwards 2004). Once the probability of occurrence between
municipality when defining the project’s scope and end users’ the identified causal factors and rework levels can be determined,
(community) inexperience in defining project needs also contrib- this model will provide the public sector with an objective assess-
uted to rework during construction (Palaneeswaran et al. 2008).
ment of the likelihood of rework levels given prevailing conditions.
The municipality allocated the budget to each project based on the
However, the procurement processes to which Colombian urban
community needs but a comprehensive design was not developed.
renewal projects are subject exposes it to corruption (Signor et al.
The lack of technical visits when defining the project’s scope and
2016). Procurement is one of the biggest areas of internal weakness
design generated many changes that had to be approved by the
to corruption risk. Public contracts in Colombia are awarded based
community; the latter were slow to reach resolution thus creating
on the lowest price. Lowest price bidding is more likely to result in
further delays and rework. It was apparent that the community
time and cost overruns as a result of opportunistic behavior of con-
lacked construction knowledge and were bound by a protracted
tractors, which can lead to poor value for money and significantly
group decision-making process; this in turn led to partial stops of
work and schedule overruns. Furthermore, the extended period higher whole life costs (Love et al. 2012).
between drawing up the project and executing it caused deterio- Lump sum contracting stimulates contractors to bid for work
rations of several sites. Therefore, modifications in the scope were at unrealistically low levels. It then becomes difficult for them to
normal in all projects. maintain standards and obtain optimum profits, the quality of their
Colombian urban renewal projects have tended to be pro- work falls, and they become more likely to make claims (which
cured using the traditional lump sum methods (e.g., design-bid- may be unjustified in many instances), delay payments to subcon-
construct). However, scope uncertainty and lack of contractor tractors, and indulge in corrupt behavior to reduce their losses. To
involvement during design provoked design changes and increased mitigate corruption risks reforms to the public procurement proc-
the initial awarded budget (Love et al. 2013). The wrong budget esses should be implemented, while contractors could help by
management coupled with the contractor’s low financial capacity maintaining high ethical standards in their own operations.
further exacerbated delays and cost increases. Contractor economic
problems delayed the materials and equipment supply that led
to imprecise execution procedures and further delays and cost Discussion
increases as a result of rework. Similarly, productivity was affected
by work quality, availability of prerequisites, out-of-sequence While limited systematic knowledge is available on construction
work, schedule pressure, morale, skill and experience, organiza- rework dynamics, generic models of rework have been developed
tional size changes, and overtime (Lyneis et al. 2001). The need for building civil engineering projects (Love et al. 2011; Forcada
to employ 80% of local workers generated construction errors due et al. 2014), residential apartments (Love et al. 1999, 2008), and for
to the worker’s lack of experience, knowledge, and competence. As complex hydrocarbon (oil and gas) projects (Love et al. 2011).
the project progressed and construction errors became increasingly These aforementioned studies revealed that rework experienced
prevalent, the contractor spent a disproportionate amount of time was predominantly generated from the project’s conception and de-
resolving problems that arose. For these small and geographically sign stages. Poor quality documentation and design errors led to
distributed sites, staff supervision is quintessentially important in changes being implemented during construction. These previous
controlling the quality of construction works via front-line manag- findings resonate with those obtained from this research, particu-
ers and the workforce. larly a lack of design and errors in allocating the budget were pre-
Previous research undertaken by Love (2002) revealed that there dominant factors leading to rework. However, the causes of these
were no significant differences between procurement methods and design errors were very different from those obtained in other pre-
rework costs. However, the case study analyzed in this paper re- vious research. The special characteristics of public contracts
veals that the characteristics of the procurement path were a con- in Colombia were determinant on the occurrence of rework. The
tributor to rework. In these cases, a proportion of rework costs were obligation to conduct community socialization meetings to seek
solvency when allocating material, equipment, and workmanship various problems encountered included the following: technical
resources were also a cause of rework. In contrast to highway infra- measurements for many of the projects were incorrect; there were
structures assets, the reduced area and scope of each project re- nonviable works or unrequired activities; and necessary works were
duced the need to deal with surrounding aspects such as traffic sometimes omitted from the designs or budgets. Therefore, many
during the construction process. budget modifications and budget exchanges between projects from
Undertaking design reviews and verifications is the first step to the same district were carried out to balance costs and spend the
minimizing the potential impact of errors, but these practices will entire awarded budget. The corrected budget was calculated to ob-
not prevent them from occurring. With this in mind, consideration tain the real deviation based on real quantities to be executed. Scope
needs to be given to employing an adviser for the community errors and poor design documentation generated additional changes
representative who has sufficient construction skills and knowledge and rework, which inflated the final executed budget to be 21.1% of
to define specifications and to changing the procurement path such the corrected budget. The most important factors contributing to
that greater shared responsibility is placed on all contractual parties rework were: the wrong initial budget derived from an inaccurate
(Love and Edwards 2004; Palaneeswaran et al. 2014). design; constant modifications and scope changes provoked by
If job creation is the reason of contracting unskilled personnel, the lack of clarity about the works; and slow client resolution on
training must be provided in order to improve work practices. If queries. Although rework costs due to the client’s scope modifica-
municipalities do not begin to reexamine their contract clauses and tions accounted for 51.3% of the project’s total cost, this cost in-
procedures, then there is a danger that errors become a norm and crease was incurred by other project modifications and by changing
adversely impact on their overall profitability and the performance specifications. Rework costs due to unexpected events accounted
of the projects that they are involved with. Selection of contractors for 4.6% of the project’s total cost but were incurred by the con-
based on experience and solvency and making sure that resources tractor. These costs were primarily due worker inexperience, pres-
are available to undertake the required work are other suggestions sure to finish works, stress, and inadequate budget management
to minimize errors and thus reduce rework. Municipalities should when allocating material and equipment resources.
pay increasing attention to effectively managing their human re- The contribution of the city’s inhabitants is fundamental to de-
sources and implementing quality management practices. fining urban improvement actions. However, the PBP does not in-
The constant urban transformation of Colombian cities because clude advising the community on technical aspects when defining
of the MDP, the infrastructural demands of this country, and this their needs, and thus produces technically unviable solutions.
study’s findings suggest that other public projects that are currently Municipalities should guide initiatives and help districts address
underway should be scrutinized. The methodology adopted for the their needs, while communities should understand that these initia-
analysis presented in this paper might be used to analyze the factors tives aim to improve the city as a homogenous whole. Understand-
that contribute to rework in public building projects and then en- ing how variables that contribute to rework interact with one
hance understanding about the dynamics of rework and develop another provides a new insight that could lead to behavioral adjust-
improvement strategies. The findings of this research are directly ment. This may be achieved by formally recognizing rework as a
applicable to other South American countries such as Brazil, key performance indicator within urban improvement contracts and
Mexico, and Chile were the urban development projects are also linking it to a risk/reward model of compensation. It is suggested
awarded under the PBP. that this would stimulate learning and process improvements for
future similar projects. Future research should focus on developing
probabilities and better define the potential impact of risks that arise
from the contract documentation process. The use of probabilistic
Conclusions
network models, such Bayesian networks, could present a suitable
In Colombia, the dynamics of rework in urban improvement proj- tool for measuring and managing rework in projects because of
ects is largely unknown, despite the fact that construction works are their ability to take into causal relations.
often neither properly defined nor executed. Consequently, project
performance is reduced significantly by unnecessary instances of
rework. In this paper, the factors contributing to rework on 69 urban References
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