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

Love, P, Smith, J, Ackermann, F, Irani, Z and Teo, P 2018, 'The costs of rework: insights from construction and opportunities for learning', Production Planning & Control, vol. 29, no. 13, pp. 1082-1095.


Document type: Journal Article
Collection: Journal Articles

Title The costs of rework: insights from construction and opportunities for learning
Author(s) Love, P
Smith, J
Ackermann, F
Irani, Z
Teo, P
Year 2018
Journal name Production Planning & Control
Volume number 29
Issue number 13
Start page 1082
End page 1095
Total pages 14
Publisher Taylor and Francis
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 organizations 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 'known-known'. 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.
Subject Building Construction Management and Project Planning
Keyword(s) Construction
costs
information
learning
quality
rework
profit
DOI - identifier 10.1080/09537287.2018.1513177
Copyright notice © 2018 Informa UK Limited, trading as Taylor & Francis Group.
ISSN 0953-7287
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