Developing and Evaluating a Digital Cost Management System for Construction Projects

Thesis Abstract

The effective management of project costs remains a persistent challenge within the construction industry, characterized by frequent budget overruns, inadequate cost control measures, and limited integration of digital technologies in cost management practices. This study addresses the need for innovative, technology-driven solutions by developing and empirically evaluating a comprehensive digital cost management system tailored specifically for construction projects. The research aims to enhance accuracy, transparency, and real-time decision-making capabilities for cost-related activities, thereby contributing to optimal resource allocation and project success. The primary objectives of this research include designing a user-centered digital cost management platform, assessing its operational efficacy, and evaluating its impacts on cost accuracy, timeliness of cost reporting, and stakeholder satisfaction. To achieve these, the study adopts a mixed-methods research design, integrating qualitative and quantitative approaches to ensure a comprehensive understanding of the subject matter. The qualitative component involves thematic analysis of interviews conducted with 25 project managers, quantity surveyors, and financial controllers across multiple construction firms, aiming to capture the contextual requirements and perceptions of digital cost management. The quantitative aspect comprises a quasi-experimental design involving 20 ongoing construction projects, with 10 projects employing the newly developed digital system and 10 utilizing traditional cost management practices. Data collection methods include structured questionnaires, project documentation review, and system usage logs. Validity and reliability of the research instruments are established through pre-testing, expert review, and Cronbach’s alpha scores exceeding 0.85. Data analysis techniques encompass descriptive statistics to summarize project and stakeholder characteristics, inferential statistics such as multiple regression analysis to examine the relationship between system adoption and cost control performance, and paired sample t-tests to assess differences in project outcomes pre- and post-implementation. Additionally, qualitative data are analyzed through thematic coding in NVivo to uncover perceived benefits, challenges, and barriers associated with digital cost management. The anticipated findings suggest that the digital system significantly improves the accuracy and timeliness of cost reporting, reduces estimation errors, and enhances decision-making processes. It is expected that projects utilizing the digital platform will demonstrate lower cost overruns—averaging a 15% reduction compared to traditional practices—and improved stakeholder satisfaction. The study also anticipates identifying critical factors influencing successful adoption, including user training, system customization, and organizational readiness. This research contributes to the theoretical advancement of cost management within construction by integrating principles from the Technology Acceptance Model (TAM) and Dynamic Capabilities Theory, highlighting the role of user acceptance and organizational flexibility in digital transformation. Practically, the developed system provides a scalable solution adaptable across various project sizes and organizational contexts, filling existing gaps related to the limited empirical validation of digital tools in construction cost control. The study concludes that implementing a dedicated digital cost management infrastructure markedly enhances project financial performance and operational transparency. Based on the findings, recommendations emphasize the importance of comprehensive user training, continuous system refinement based on user feedback, and strengthening organizational change management strategies. The research also advocates for further longitudinal studies to evaluate long-term impacts and integration with broader project management systems, thereby fostering a digital culture within the construction industry that aligns with contemporary technological advancements and strategic objectives.