The costs of rework: insights from construction and opportunities for learning

Abstract

During the production of artefacts in construction there is a likelihood for errors to be committed, which may need to be rectified so that they conform to defined contractual requirements and standards. In doing so, this initiates a process of rework, which is a problem that the industry has incessantly aimed to redress for decades with limited success. Rework is a 'known-unknown', but there remains a high degree of uncertainty about its costs. Such uncertainty occurs as there is a proclivity for the costs associated with rework to be largely ignored, concealed or considered to be normal function of operations. This paper presents the results from the first longitudinal and in-depth study of rework costs in construction. Based on a sample of 19,605 rework events derived from 346 construction projects delivered by a contractor between the years 2009 and 2015, it was revealed that their mean yearly profit over the period of analysis was reduced by a staggering 28%. In addition, 88 (0.45%) of the total 19,605 rework events accounted for 34% of the total costs that were incurred. The complete cost data for 98 of the 346 projects was made available, which enabled a mean rework cost of 0.39% of contract value to be determined. The research provides construction organisations with an improved understanding of the nature and likelihood of rework costs enabling them to move from a position of being a 'known-unknown' to becoming a 'knownknown'. Being able to 'anticipate what might go wrong' and ensure that risk management and controls are put in place throughout the construction process will contribute to their dynamic capability.

Dissecting the project anatomy: Understanding the cost of managing construction projects

“…As a consequence, there is a risk that poor quality remains undetected and not discovered until later. Love et al (2018) found that lack of supervision was the most frequent factor causing rework in construction projects.…”

BIM-based and AR Application Combined with Location-Based Management System for the Improvement of the Construction Performance

“…According to Love at al. [13], omissions in quality controls may cause construction errors and quality degradation, which negatively affect both costs and project schedules. Therefore, insufficient management and -quality controls affect delays, project profitability and cost increase [14].…”

Methods of construction quality issues elimination with use of modern technology

“…Transition to proactive quality management is suggested, which can contribute to the minimization of errors with the help of modern technological solutions, as discussed in this work. Severe influence of rework costs on construction companies profit, as revealed by Love et al [11] (even 28% profit reduction) is a good starting point for proper quality management while planning investment. According to the approach explained by Ross and Perry [10] securing budget for quality assurance may produce income due to savings based on lack of rework and failure costs -it has been shown on monetary estimate example, according to which correction of errors costs 10 times more than their prevention, and what is more cost of failure is 100 times more than preventing itsee fig.…”

“…-area of works during which defect occurred, -type of defect and its consequence, -cause and responsible phase of construction stage (design, construction), result and losses caused by defects, -necessary actions required to solve problem, Analyzing presented set of errors, one can notice basic division into designing and constructing errors. Love et al [11] refer to them as project rework and construction rework. The former are mostly associated with processing of a large amount of information, which has to be coordinated in a multi-person team, and then conveyed in a descriptive and graphical form consisting of many interdependent drawings.…”