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1. Introduction
Construction projects are inevitably related to a future period of time so that it is problematic to predict the results of their implementation. They depend on how accurately the amount of material and their associated flows during the project are forecasted. Insufficient information is a problem, and stochastic materials flow through the value stream likewise hinder the universal application of lean principles to the construction supply chain (Fearne and Fowler, 2006; Forsman et al., 2012; Eriksson, 2010). In essence, the lean concept focuses substantially on the process flow, and a synchronization of demand and production. Therefore, it is difficult to implement this in the construction industry, due to its inherent uncertainty and complexity, both of which cause disintegration in its supply chains (Voordijk et al., 2006; Briscoe and Dainty, 2005; Fearne and Fowler, 2006). Hence, the construction supply chain should be developed within the framework of the “agile paradigm” (Vrijhoef and Koskela, 2000). Nevertheless, this study supports the idea of using a material inventory to avoid supply chain disruption in the construction industry.
Difficulties in planning construction projects result in the work flow variability causing inefficiency in downstream processes that result in delays and the associated costs. Accordingly, it is crucial to consider all possible outcomes and the influence of risk factors due to disruptions in the construction supply chain. Risk factors affect the value of investment in construction projects, by inducing a deviation of future cash flows from the expected flow within the project, which results in firms exceeding their budget goals. For so-called “megaprojects”, risks may result in cost overruns during the process of their implementation with more than 100 percent overspending from the expected budget appraisals, and the incurring of additional costs even before the construction begins.
The actual financial cost of the longest underwater railway, the Channel Tunnel, was sharp 140 percent higher than the estimated investment cost (Flyvbjerg et al., 2003). The increase in cost by 55 percent of the Great Belt Bridge (Denmark) was noted three years before the expected date of completion of the project, while the change in the cost (+10 percent) of the Öresund Bridge (Sweden) was recorded even before the start of its construction (Bruzelius et al., 2002). The...