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IN THE NAME OF ALLAH, THE MOST GRACIOUS, THE MOST MERCIFUL
ANALYSIS OF CAUSES OF SUCCESS AND FAILURE
OF POST DISASTER RECONSTRUCTION PROJECTS
IN EARTHQUAKE AFFECTED AREAS OF PAKISTAN



                      BY
    Muhammad Abbas Choudhary & Kashif Mehmood

                                         August 27, 2012
              International Disaster and Risk Conference
                        IDRC 2012, DAVOS, Switzerland.
PART – I
    • Introduction, Problem Statement and Objectives
                        PART – II
S   •   Natural Disaster and its Impacts
    •   Project Success Criteria and KPIs
E   •   Critical Success and Failure Factors
Q   •   Post-disaster Housing Reconstruction
                       PART – III
U   • Case Study of the Earthquake October, 2005
E                       PART – IV
    • Project Data Collection and Analysis
N   • Questionnaire Surveys and Statistical Analysis
C   • KPIs of ERRA Building Projects, Earned Value
      Analysis of Under Construction Projects
E                      PART – V
    • Proposed Framework
    • Recommendations and Conclusions
INTRODUCTION
• A significant part of development assistance is spent on the
  construction of infrastructure in Pakistan but these
  investments can be lost in seconds in the event of a natural
  hazard
• Post-disaster reconstruction in Pakistan rely either on external
  assistance or by reallocation of resources from existing
  developmental projects to meet reconstruction needs
• After the destruction of 2005 Earthquake in North Pakistan,
  government has assigned the task of reconstruction and
  rehabilitation of quake-hit areas to newly formed Earthquake
  Reconstruction and Rehabilitation Authority (ERRA)
• ERRA is the central body for reconstruction of 13,312 projects
  & for 600,000 private housing units in quake affected areas of
  Pakistan

                                 Source: ERRA,2011, Annual review 2010-11
Cont’d
• There are some factors responsible for success or
  failure of multidisciplinary reconstruction projects and
  these factors, if not handled properly may be
  detrimental for the success of the project
• Failure will affect
   –   Unmet development goals
   –   loss to economy
   –   loss of donor confidence
   –   loss of funding for disaster relief
   –   loss to rehabilitation of victims
   –   loss to construction related organizations
PROBLEM STATEMENT
• The ERRA post-disaster reconstruction programme in
  earthquake affected areas of Pakistan is not meeting the
  success criteria because of many factors. Roads, hospitals &
  schools planned with money given by foreign governments &
  international aid groups remain unbuilt almost five years after
  the earthquake
• The initial relief operation is successful in its aim. However,
  despite     the    extensive     resources,    the   subsequent
  reconstruction is not meeting its objectives
• In disaster prone countries like Pakistan success of
  reconstruction & rehabilitation projects are very important for
  normalization of life in disaster affected areas
OBJECTIVES OF RESEARCH WORK
• To analyze the post disaster reconstruction projects
• To identify success and failure factors in construction
  process and to identify their relative importance
• To establish success criteria for measuring the performance
  of post disaster construction projects
• To analyze the key performance indicators for cost and time
  of different building projects
• To carry out earned value analysis of the ongoing projects
• To analyze the causes of success of post disaster housing
  reconstruction and rehabilitation project, with respect to the
  World Bank funded projects
RESEARCH METHODOLOGY
• Main source of data is ERM database of ERRA & MIS
  database of PPAF(Pakistan Poverty Elevation Fund)
• Literature review - exhaustive list of critical success and
  failure
• From studies mention above 68 project success/failure
  factors for ERRA reconstruction programme was concluded
• A 68 factors survey questionnaire was used where the
  respondents were asked to assess the critical success and
  failure factors, both on their perceived importance and on the
  extent of their presence in the reconstruction project.
• A total of 74 completed responses were received, giving a
  response rate of 40%.
• Framework & strategy for reconstruction projects success is
  proposed
• Recommendations for improvement and conclusion
LITERATURE REVIEW
EARTHQUAK
    E
WORLDWIDE EARTHQUAKE MORTALITY
               Top 10 Earthquakes Globally by Mortality (1970-2009)
                                                               Persons             Persons
      Date                  Country            Richter
                                                                killed             affected
 July 27th, 1976             China                7.8          242,000             164,000
                         Indian Ocean
 Dec 26th, 2004                                    9            226,000           2,432,000
                           tsunami
 May 12th, 2008              China                7.9           88,000           45,977,000
                          Pakistan &
October 8th, 2005                                 7.6           75,000            5,285,000
                             India,
May 31st, 1970                Peru                7.8           67,000            3,216,000
June 21st, 1990               Iran                7.3           40,000             710,000
 Dec 26th, 2003                Iran               6.6           27,000             268,000

 Dec 7th, 1988              Armenia               6.9           25,000            1,642,000

 Sept 16th, 1978               Iran               7.7           25,000              40,000

 Feb 4th, 1976            Guatemala               7.5           23,000            4,993,000

       Source: Data extracted from CRED (2010 ) EM-DAT International Disaster Database
ECONOMIC   DAMAGES                                         &        NUMBER           OF
 EARTHQUAKE
 •      Earthquakes were responsible for 29% of natural disaster-related
        deaths in the last 30 years but accounted for 58% of fatalities in the
        last decade
 •      56% of all earthquakes happened in Asia, causing 90% of global
        earthquake fatalities

                                          Economic Damage
Country        Date           Magnitude
                                          (Billion US $)

Japan          Jan 17, 1995   7.2         140.4
China          May 12, 2008   7.9         84.4
United State   Jan 17, 1994   6.6         43.3
Japan          Oct 23,2004    6.6         31.7
Turkey         Aug 17,1999    7.4         25.7
Italy          Nov 23, 1980   7.2         51.9
Taiwan         Sep 21, 199    7.6         18.1
Russia         Dec 7, 1988    6.9         25.3
Japan          Jul 16, 2007   6.8         12.9
Iran           Jun 21, 1990   7.3         13.1



                      Source: EM-DAT: The OFDA/CRED International Disaster Database
SEISMIC ZONES OF
    PAKISTAN
7.7 MAGNITUDE EARTHQUAKE IN QUETTA – 1935

Lytton                         Railway
Road                           Station
                      35,000 deaths




         Bruce Street, Quetta, before & after the earthquake
WORLDWIDE NATURAL DISASTER TRENDS

   A particularly high number of disasters occurred recently. Fact is that
   almost 270 large natural disasters have appeared since 1955




Source: EM-DAT - International Disaster Database www.emdat.be University catholique de Louvain Brussels –
Belgium
TOP TEN NATURAL DISASTER BY ECONOMIC DAMAGES

   The disasters with the highest economic impact occur primarily in
   highly developed countries
                                                                 Total damages
        Year   Country or Region          Event                                     Rank
                                                                 (mill. US $)

        2005   USA                        Hurricane Katrina      125,000            1
        1995   Japan/Kobe                 Earthquake             100,000            2
        1994   USA/Northridge             Earthquake             44,000             3
        1998   China/Yangtze region       Flooding               30,700             4
        2004   Japan                      Earthquake             28,000             5
        1992   USA/Florida                Hurricane Andrew       26,500             6
        1996   China/Yangtze region       Flooding               24,000             7
        2004   USA/Caribbean              Hurricane Ivan         23,000             8
        1993   USA/Mississippi            Flooding               21,000             9
        2004   USA/Caribbean              Hurricane Charley      18,000             10


Source: Schenker-Wicki et al. (2010) ‘Unmastered risks: From crisis to catastrophe, An economic and
management insight ‘,Journal of Business Research, 63, 337–346.
PROJECT SUCCESS CRITERIA
             Criteria used for judging Project                              Ranking
                         Success
                   Meets client’s requirements                                    1
                   Completed within schedule                                      2
                     Completed within budget                                      3
                Meets organizational objectives                                   4
                Yield business & other benefits                                   5
            Causes minimal business disruption                                    6

                Meets quality/safely standards                                    7

                             Other criteria                                       8
Source: Data extracted from White, D. & Fortune J. (2002) ‘Current practice in project management an
empirical study’, International Journal of Project Management, pp.1-11
CRITICAL FAILURE FACTORS
       A project is considered failed if it falls short in achieving
       the planned objectives, goals or is unable to achieve
       stated & agreed tasks within given constraints
       Critical failure factors extracted from literature are;
             conflict among project participants
             lack of knowledge
             hostile socio economic and climatic condition
             reluctance in timely decision
             short bid preparation time
             bad political influence
             bribes etc
       The construction industry is the worse affected by
       corruptions
Source: K.C. Iyer and K.N. Jha (2005), ‘Factors affecting cost performance: evidence from Indian construction projects’,
International Journal of Project Management, 23; 283–295
PART – III
CASE STUDY OF THE OCTOBER 2005
 EARTHQUAKE RECONSTRUCTION
          PROJECTS
POPULATION AFFECTED: 3.5 M
                                                                      Gilgit




                          Kalam                    M-7.6

Fault Line 100
  KM Long                         Pattan



                Mingora

                              Batgram            Kaghan
                                                           •Human Loss - 73,338

                                             Balakot       •Injured     - 1,28,309
                                         GHB             •Families Affected - 500,000
                                            Muzaffarabad
            Mardan                Mansehra


 Peshawar                          Abbotabad
                                                          Bagh
                                                   Arja

                                                           Rwkt
                            Islamabad
                                    Rawalpindi




 AREA AFFECTED - 30,000 SQ KM                                                        20
ECONOMIC IMPACTS OF 2005 EARTHQUAKE
  • Overall cost associated with the earthquake is estimated at
    approximately US$5.198 billion
  • Direct total damage sustained due to the earthquake was Rs. 135.1
    billion (US$2.3 billion)
  • The largest component of this damage is private housing, which
    amounts to Rs. 61.2 billion (US$1.03 billion), followed by damage to
    the transport sector totaling Rs. 20.2 billion (US$340 million)
  • Cost of reconstruction of lost assets and of the restoration of public
    services is estimated to be Rs. 208 billion (US$3.5 billion)




Source: The Asian Development Bank and World Bank (2005) Pakistan 2005 Earthquake: Preliminary Damage and Needs Assessment, Islamabad
DISTRIBUTION OF RESPONSIBILITIES
• After the earthquake Government quickly established the Federal Relief
  Commission (FRC) on October 10, 2005, to supervise and coordinate
  relief efforts
• Later stages of recovery, reconstruction and rehabilitation were left to
  the ERRA which was formed in January 2006. The key actors in the
  new organizational structure for reconstruction of quake-hit areas
  include:
− ERRA as a central agency responsible for coordinating, macro
  planning, financing, project approval and monitoring
− Secretariats servicing governments in KPK & in AJK is responsible
  for provincial/state strategy formulation; the secretariats are known as
  the Provincial Earthquake Reconstruction & Rehabilitation Authority
  (PERRA) in the province & the State Earthquake Reconstruction &
  Rehabilitation Authority (SERRA) in AJK. The basic mandate of
  implementation of all reconstruction projects rest with these forums
− District reconstruction units in each district to execute all
  reconstruction and rehabilitation projects

                                                 Source: ERRA, Annual review 2006-2007
ERRA RECONSTRUCTION & REHABILATION
                         PROGRAMME
   ERRA programme is divided into two parts:
   1.Owner-driven housing programme, which was for
   600,000 homes
   2.The other part of the programme consists of about
   13,312 projects in 11 different sectors and three cross-
   cutting programmes at a cost of over US$ 5 billion
                                                     Projects construction summery of all Projects
Owner-driven Housing                                 as on 10 Aug, 2011

Programme




                Source: Developed from data provided by ERRA
PHYSICAL PROGRESS ANALYSIS OF ERRA PROJECTS
• Monthly progress reports of ERM database was collected from all
  District Reconstruction Units for last one year

                               Number of Projects               Percentage
     Total Projects:                      13,312
        Allocated:                        13,312                100.00 %
       Unallocated                            0                    0.00 %
         Stages
       Completed                           7357                  55.27 %
   Under Construction                      3868                  29.06 %
        Tendering                          1677                  12.60 %
        Designing                           393                   2.95 %
        Planning                             17                  0.05   %

                 Source: Developed from data provided by ERRA
PHYSICAL PROGRESS ANALYSIS OF PROJECTS IN
               TERM OF FUNDING SOURCE
 •    In term of funding sources, all projects can be divided into 3 separate
      groups, GOP funded projects, donor funded projects and sponsor
      funded projects
 •    Physical progress of Sponsor funded projects is highest and GOP
      funding projects are lowest
 •    Combination of fielding inexperienced staff or incompetent contractors
      to manage very complex projects in a shifting policy and cost escalation
      environment is leading to significant failure in term of delivery timing
      and cost drift
                                                                                                                 Designing &
                      Completed                           Under construction                      Tendering
                                                                                                                  Planning
 Funding    Total
                                              Total               Number of Projects
 Source    Projects
                      No.      %                                                                 No.      %      No.     %
                                       No       %        76-95%   51-75%       26-50%   0-25%


GOP         8,713     3,290   37.76     3,505    40.23    547       738          911     1,309   1,575   18.08   330    3.79
Donors      1,130     881     77.96     197      17.43     30        62           68      37      33     2.92    19     1.68
Sponsors    3,469     3,186   91.84     166       4.79     49        40           31      46      69     1.99    44     1.27
All        13,312     7,357   55.27     3,868    29.06    626       840         1,010    1,392   1,677   12.60   393    2.95


                                      Source: Developed from data provided by ERRA
CURRENT STATUS OF ALL ERRA’s PROJECTS
7343 projects are completed before August 10, 2011, total under construction
projects are 3868 while 1877 projects are still at designing and tendering stages.
The physical progress of Social Sector projects is the lowest (13.33%) and
Livelihood Sector projects are the second lowest (18.96%). These projects are
government funded and inadequate availability of resources and lack of money
is the main reason for slow progress in above two sector buildings.
                       Total                                                                     Designing &
                                       Completed    Under Construction         Tendering
        District      Projects                                                                    Planning
                           No.       No.      %           No.      %         No.      %          No.     %
  Grand Total         13312      7357      55.27%   3,868       29.06%   1,677      12.60%   410       3.08%
  Education           5,751      2,055     35.73%   2,151       37.40%   1,334      23.20    212       3.67%
  Environment         466        160       34.33%   293         62.88%   13         2.79     0         0.00%
  Governance          697        392       56.24%   258         37.02%   47         6.74     0         0.00%
  Health              306        162       52.94%   97          31.70%   41         13.40    6         1.96%
  Livelihood          1,076      204       18.96%   489         45.45%   205        19.05    178       16.54%
  Medical
                      6          6         100.0%   0           0.00%    0          0.00     0         0.00%
  Rehabilitation
  Power               15         10        66.67%   2           13.33%   0          0.00     3         20.00%
  Social Protection   15         2         13.33%   7           46.67%   6          40.00    0         0.00%
  Telecommunicatio
                      1          1         100.0%   0           0.00%    0          0.00     0         0.00%
  n
  Transport           233        137       58.80%   84          36.05%   11         4.72     1         0.43%
  WatSan              4,746      4,228     89.09%   487         10.26%   20         0.42     11        0.23%
RECONSTRUCTION PROGRESS AS ON 10 August, 2O11
               Reconstruction Project Progress Yearly-wise




                                                             Reconstruction Summary
ANALYSIS, RESULTS AND
     DISCUSSION
DATA COLLECTION
• Main source of data is ERM database of ERRA and MIS
  database of Pakistan Poverty Elevation Fund
• Data is also collected from different NGOs, United Nation
  agencies, NESPAK, contractors, C&W Mansehra, PWD
  Neelum, District Reconstruction Units etc.
• Different nature of reconstruction projects in earthquake
  affected areas of Pakistan are selected, which have been
  executed in the last five years with at least Rs. 1 Millions
  worth
• The financial and scheduling data of all the ERRA 13,312
  small and large projects have been collected and it has
  been analyzed by using the some performance indicators,
  earn value analysis and in light of executers opinions
• Project success & failure factors are extracted from this
  process
Cont’d
• 185 questionnaires were send to construction professionals
  of Pakistan, selected randomly from across the quake-hit
  areas
• A total of 74 completed responses were received




                               Project Classification of Respondents’
Nature of
                               Organization
Respondents
DATA EVALUTION
• A four-point Likert scale was used to measure the factor influence
  on overall performance of reconstruction projects
• The individual numerical ratings of each of the identified factors
  were transformed to relative importance indices to assess the
  relative ranking of factor by using the following formula
• RII= ∑X/(A*N) , (O < RII < 1)
        Where
− RII = relative importance index.
− X = rating given to each factor by the respondent; ranging from 1
  to 4 where '1’ is not effective at all and '4' is extremely effective
− A = highest rating (i.e. 4 in this case)
− N = total number of respondents responding to that factor
• The biggest value of RII of a factors indicates the most important
  success factors with rank one and the smallest value of RII
  indicates the most critical failure factors with rank one & so on
• Statistical Package for the Social Sciences (SPSS) was used to
  find correlation in ranking among different responding groups

 Source: Daniel W.M. Chan , Mohan M. Kurnaraswarny (2002) International Journal of Project Management, vol.20, pp. 23-35
Analysis of Success Criteria from Questionnaire’s
                     Feedback




Discussion
− Ranking of all success criterions was obtained by computing RII for
   overall sample as well as separately for all responding groups
− Respondents are conscious about the popular ‘Iron Triangle’ of
   construction industry, that is “completion on time, under budget &
   according to specifications”
Result:
• Top ranked success criteria are completion ‘within schedule’, ‘within
   budget’, ‘stakeholders satisfaction’, ‘meet specifications’ and ‘high
   quality of workmanship’                                               Cont’d
SOLICITATION OF RECONSTRUCTION PROJECT
          SUCCESS & FAILURE FACTORS
• Depending upon mean scores of responses for various factors,
  the factors were segregated in three groups: the first group (with
  µ≥ 3.0) that showed positive contribution; the second group (with
  3.0 < µ < 2.35) which was neutral, having no significant impact on
  the project success and the third group (with µ≤ 2.35) indicating
  negative impacts
• Factors of first group (µ≥ 3.0) were arranged on their descending
  order of RII values and ranked
• Factors of the third group (with µ≤ 2.35) were arranged in
  ascending order of the RII and ranked. The lowest RII indicates
  the most critical failure factor with rank 1 and so on
                                Ranges of mean values
              Group 1                  Group 2                  Group 3
              µ≥ 3.0                3.0 < µ < 2.35               µ≤ 2.35
             14 factors               24 factors                17 factors
             Success      Neither positively contributing nor   Adversely
              factors            adversely affecting            affecting
Post-disaster Reconstruction Project Success
                  Factors
Post-disaster Reconstruction Project Failure
                  Factors
Post-disaster Reconstruction Project Success
                  Factors
  S. No Critical project success factors (µ≥ 3.0)                              RII     Mean    Rank

  1      Clarity of goals and directions of the project                        0.889   3.554   1

  2      Detailed planning of project                                          0.855   3.419   2

  3      A full-time and experienced project manager                           0.834   3.338   3

  4      Clear & detailed written contracts                                    0.814   3.257   4

  5      Effective monitoring and feedback                                     0.801   3.203   5

  6      Projects management skills                                            0.794   3.176   6

  7      Frequent meetings among various stakeholders                          0.780   3.122   7
         Project team members possess adequate capabilities &
  8                                                                            0.774   3.095   8
         experience
  9      Extent of rewarding high performing staff and motivation              0.767   3.068   9

  10     Sufficient capacity of contractors                                    0.764   3.054   10

  11     PM ability to handle contingencies & deviations from plan             0.760   3.041   11

  12     Adequate communication among related parties                          0.756   3.021   12

  13     Training human resources in the skill demanded by the project         0.752   3.011   13

  14     Client’s clear and precise definition of project scope & objectives   0.750   3.000   14
Post-disaster Reconstruction Project Failure
                  Factors
S.No   Critical Failure Factors for Construction Projects (µ≤ 2.35)                       RII     Mean    Rank

 1     Inadequate availability of resources (funds, material etc.)                       0.443    1.77     1
 2     Finance problems and payments of completed work                                   0.449    1.797    2

 3     Lengthy decision taking process & reluctance in timely decision by stakeholders   0.483    1.932    3

 4     Excessive subletting                                                              0.517    2.068    4
 5     Centralized system by ERRA                                                        0.531    2.123    5
 6     Inappropriate cost and time estimation                                            0.530    2.122    6
 7     Shortages of skilled man-power, experienced professionals                         0.536    2.148    7
 8     Increasing energy, material, labor prices & their shortages                       0.537    2.149    8
 9     Vulnerability of roads and difficult access to site                               0.540    2.161    9
 10    Political support                                                                 0.541    2.162    10
 11    Mistakes/ delays in producing design documents & drawings                         0.551    2.203    11
 12    Complexity and large size of reconstruction project                               0.554    2.216    12
 13    Work suspensions owing to conflicts                                               0.557    2.23     13
 14    X-Factor (fraudulent practices, corruption, favoritism etc.)                      0.574    2.297    14
 15    High cost of skilled labor & high transportation costs                            0.578    2.311    15

 16    Capacity of line departments                                                      0.5810   2.323    16

 17    Harsh climatic condition                                                          0.5811   2.324    17
SOLICITATION OF ERRA’S RECONSTRUCTION
PROGRAM FOR MONITORING & MANAGING PURPOSE
    The "normal" pace of project implementation is simply not
    good enough to address the urgent needs of the people
    affected by the earthquakes
    ICT tools (wireless communication, webmail, database bank)
    are keys to identify the gaps in reconstruction delivery
    The online database may provide a tool to track the physical
    progress of implementing agencies
    ERRA need to classifying delayed projects into 4 categories,
    based on the partner’s frequency of updating their data on the
    online databank. Concepts related to managing and
    monitoring of the reconstruction programme of ERRA
−   Halted Projects
−   Delayed Projects
−   Snailing Progress (Time Overrun Projects)
−   Awaiting Progress
HALTED PRJECTS
• A project becomes halted if more than 3 months
  have passed and no physical progress is received.
  Halted Projects are further categorized into the
  following categories:
− Halted - No Work Started: Commencement order is
  issued but work has not started since 3 months or
  more. The project should have zero % physical
  progress
− Halted - Sick Projects: Construction is stopped
  between 1% and 80% since 3 months or more
− Halted - Stuck Projects: Construction is stopped
  between 81% and 95% since 3 months or more
Cont’d
    Detail of Sector wise Halted Projects as on 10 August, 2011
          Sector             Under      Total Halted      No Work Started       Sick            Stuck
                          Construction NO.     %         NO.      %         NO.    %        NO.    %


           Grand Total:       3868      2322    60.03      194      5.02    1950    50.41    178    4.60
     Education               2,151      1,301   60.48      117      5.44    1,101   51.19    83     3.86
     Environment              293        163    55.63       8       2.73     138    47.10    17     5.80
     Governance               258        172    66.67       6       2.33     149    57.75    17     6.59
     Health                    97         4      4.12       0       0.00      2     2.06      2     2.06
     Livelihood               489        243    49.69      29       5.93     206    42.13     8     1.64
     Power                                                                          100.0
                               2          2     100.00      0       0.00      2               0     0.00
                                                                                      0
     Social Protection         7          5     71.43       0       0.00      5     71.43     0     0.00
     Transport                 84        28     33.33       1       1.19     22     26.19     5     5.95
     WatSan                   487        404    82.96      33       6.78     325    66.74    46     9.45

Result
• Lack of funding, increase in taxes because of August 2010 flood,
  remote hilly areas, location of some sites directly below the high
  voltage power line and shortage of technical persons is the main
  reasons for stopping of work at these projects
DELAYED PROJECTS
• When a project fails to achieve the planned progress
  and lags behind the schedule, it is declared delayed
  whether the time is over run or not. Difference between
  planned & actual progress should be 30% or more for
  delayed projects. The delayed projects are further
  categorized into the following categories
− Delayed - Slow Progress: Difference between planned
  and actual progress is between 30% and 49%
− Delayed - Sick Projects: Difference between planned
  and actual progress is between 50% and 74%
− Delayed - Critical Projects: Difference between planned
  and actual progress is equal to or greater than 75%
Cont’d
        2944 number of projects is declared Delayed at 10 August, 2011
                                                                                     Delayed Projects
                                          Under                                    Slow
                             Total     construction             Total            Progress          Sick                Critical
         Sector             Projects   No      %       No          %        No        %        No       %        No         %
             Grand Total:    13312     3868    29.06   2746         70.99    641       16.57    962     24.87    1143       29.55
    Education                5,751     2,151   37.40   1,692        78.66    388       18.04    541     25.15     763       35.47
    Environment               466       293    62.88    200         68.26    49        16.72    50      17.06     101       34.47
    Governance                697       258    37.02    175         67.83    44        17.05    61      23.64      70       27.13
    Health                    306        97    31.70     24         24.74    12        12.37    10      10.31       2        2.06
    Livelihood               1,076      489    45.45    275         56.24    52        10.63    106     21.68     117       23.93
    MR & Telecom               6        0      0.00         0       0.00         0     0.00         0     0.00        0      0.00
    Power                     15        2      13.33        0       0.00         0     0.00         0     0.00        0      0.00
    Social Protection         15        7      46.67        7      100.00        6     85.71        1   14.29         0      0.00
    Transport                  1        0       0.00     0           0.00     0         0.00    0        0.00         0      0.00
    WatSan                    233       84     36.05    42          50.00    17        20.24    17      20.24         8      9.52

Result
•    Generally government of Pakistan faces shortage of funds in financial
     allocation to ERRA’s projects and projects more than the available
     finances are started which later on causing delay in payment to
     contractors. When the contractors do not receive their payments then they
     also stop paying to their supplier and labour. These scarcities of cash flow
     cause the project delay
SNAILING PROGRESS (TIME OVERRUN PROJECTS)
Construction pace of Snailing Progress Projects is very slow. They can not
be called “Halted (Sick/Stuck)” because they do some progress in 90 days.
They do not fall under the category of delayed projects because the
difference between planned and actual progress is less than 30%
−Non imposition of penalty/liquidity damage by the consultant, subletting of
contracts, critical technical observations, poor condition of road, price hike
in construction material and procedural delays by clients are the some
reasons of time overrun project
           Detail of Snailing Progress Projects at 10 August, 2011

                                                  Number of Projects

                    Under                                  Time Over Run
  Sector
                 Construction   Total   Up to 3                               10-12    > 12
                                                  4-6 Months    7-9 months
                                        Months                               Months   Months
  Grand Total:      3,868       296        5          20               37      20      214
  Education         2,151       155        4          12               28      13       98
  Environment        293         63        0          8                5       2        48
  Governance         258         33        0          0                0       1        32
  Health              97         0         0          0                0       0        0
  Livelihood         489         19        0          0                0       0        19
  Transport           84         15        0          0                3       1        11
  WatSan             487         11        1          0                1       3        6
AWAITING PROGRESS
• A project is considered member of this group if more than 49 days
  have passed and no progress is received
• If there is no improvement in progress on a project of this group than
  after 90 days the project will automatically become “Halted (No
  Work Started/Sick/Stuck)” and disappear from awaiting progress
  report group
• Result:
− This awaiting progress report will give an early warning to managers
  that the progress of project is not received since long
− Sector wise detail of Awaiting Projects (Waiting since 50 to 89 days)
                               Awaiting No Work
                       Total                      Awaiting Sick   Awaiting Stuck
       District                     Started
                       No.       No.        %     No.       %      No.       %
       Grand Total     527       16       3.04    374     70.97    137     26.00
       Education       199        0       0.00    174     87.44    25      12.56
       Environment      45        0       0.00    32      71.11    13      28.89
       Governance       27        0       0.00    23      85.19     4      14.81
       Health           31        1       3.23    24      77.42     6      19.35
       Livelihood      189       15       7.94    90      47.62    84      44.44
       Transport        19        0       0.00    17      89.47     2      10.53
       WatSan           17        0       0.00    14      82.35     3      17.65
       Transport        19        0       0.00    17      89.47     2      10.53
PROPOSED FRAMEWORK


RECOMMENDATIONS AND
    CONCLUTION
Comprehensive Framework for Reconstruction
             Project Success
Framework for Effective Post-disaster Recovery Process in
                       Pakistan
Organizational Models for Recovery Projects in Pakistan
1) Create new dedicated organization or task force
−   Seriously consider this option for large-scale disasters
−   Formulate the exit strategy to avoid agency surviving beyond its
    mission
2) Dedicated organization drawn from existing line
   ministries
−   It may undermine ongoing non-disaster programs
−   International agencies may not finance backfilling of normal
    ministry functions
3) Existing Governmental Agencies Manage Recovery
   under National Disaster Plan
−   This model needs detailed pre-disaster planning, staff training &
    national disaster plan
−   It requires existing line ministries to be strengthened with
    experienced staff
RECOMMENDATION AT NATIONAL LEVEL
•   All stages of a disaster response should be handled by the same
    dedicated permanent institution
•   Development of human resource to cater for global disasters from rescue
    to reconstruction
•   Establish worldwide linkage between government and NGOs and share
    experience with disaster-hit countries
•   Government should specify rates periodically based on requirement and
    price escalation
•   Approach for housing reconstruction after mega disaster should be
    owner driven
•   Time and cost schedule for site in remote areas should be flexible along
    with special incentives to attract NGOs and contractors to far flung areas
•   Progress analysis of projects should be carried out by client, consultant
    and contractor to know whether the project is successful
•   Project success criteria and KPIs should be developed at the initial
    stages of project before implementation
•   As there are different requirements and special targets of any given
    project, success measurement should also be tailored for each project
•   The earned value analysis of the projects should be carried out during
    execution of projects to control/monitor the project to see whether the
    project is on schedule and within budget or not
FUTURE RESEARCH DIRECTIONS
− Comprehensive analysis of the causes of success and failure at the end of
  reconstruction projects in disaster affected areas of Pakistan
− Project success criteria and key performance indicators for construction
  projects in Pakistan
− Assessment of critical success and failure factors in other industries in
  Pakistan
− Establishment of a comprehensive benchmarking system to determine the
  performance of mega development projects in government sector
− Establishment of a clear link between critical success factors and project
  success criteria
− Analysis of cost overrun and delays in post disaster recovery projects in
  Pakistan
− Role analysis of consultants, contractors, relief and recovery organization
  after mega disaster in Pakistan
− Project success factors and criteria for aid agencies in the World
− Impact assessment of post disaster reconstruction projects to examine
  how beneficiaries perceive the performance of reconstructed facilities

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Causes of success and failure in post disaster reconstruction projects – a case study of post 2005 earthquake rehabilitation and reconstruction in Northern Pakistan

  • 1. 1 IN THE NAME OF ALLAH, THE MOST GRACIOUS, THE MOST MERCIFUL
  • 2. ANALYSIS OF CAUSES OF SUCCESS AND FAILURE OF POST DISASTER RECONSTRUCTION PROJECTS IN EARTHQUAKE AFFECTED AREAS OF PAKISTAN BY Muhammad Abbas Choudhary & Kashif Mehmood August 27, 2012 International Disaster and Risk Conference IDRC 2012, DAVOS, Switzerland.
  • 3. PART – I • Introduction, Problem Statement and Objectives PART – II S • Natural Disaster and its Impacts • Project Success Criteria and KPIs E • Critical Success and Failure Factors Q • Post-disaster Housing Reconstruction PART – III U • Case Study of the Earthquake October, 2005 E PART – IV • Project Data Collection and Analysis N • Questionnaire Surveys and Statistical Analysis C • KPIs of ERRA Building Projects, Earned Value Analysis of Under Construction Projects E PART – V • Proposed Framework • Recommendations and Conclusions
  • 4. INTRODUCTION • A significant part of development assistance is spent on the construction of infrastructure in Pakistan but these investments can be lost in seconds in the event of a natural hazard • Post-disaster reconstruction in Pakistan rely either on external assistance or by reallocation of resources from existing developmental projects to meet reconstruction needs • After the destruction of 2005 Earthquake in North Pakistan, government has assigned the task of reconstruction and rehabilitation of quake-hit areas to newly formed Earthquake Reconstruction and Rehabilitation Authority (ERRA) • ERRA is the central body for reconstruction of 13,312 projects & for 600,000 private housing units in quake affected areas of Pakistan Source: ERRA,2011, Annual review 2010-11
  • 5. Cont’d • There are some factors responsible for success or failure of multidisciplinary reconstruction projects and these factors, if not handled properly may be detrimental for the success of the project • Failure will affect – Unmet development goals – loss to economy – loss of donor confidence – loss of funding for disaster relief – loss to rehabilitation of victims – loss to construction related organizations
  • 6. PROBLEM STATEMENT • The ERRA post-disaster reconstruction programme in earthquake affected areas of Pakistan is not meeting the success criteria because of many factors. Roads, hospitals & schools planned with money given by foreign governments & international aid groups remain unbuilt almost five years after the earthquake • The initial relief operation is successful in its aim. However, despite the extensive resources, the subsequent reconstruction is not meeting its objectives • In disaster prone countries like Pakistan success of reconstruction & rehabilitation projects are very important for normalization of life in disaster affected areas
  • 7. OBJECTIVES OF RESEARCH WORK • To analyze the post disaster reconstruction projects • To identify success and failure factors in construction process and to identify their relative importance • To establish success criteria for measuring the performance of post disaster construction projects • To analyze the key performance indicators for cost and time of different building projects • To carry out earned value analysis of the ongoing projects • To analyze the causes of success of post disaster housing reconstruction and rehabilitation project, with respect to the World Bank funded projects
  • 8. RESEARCH METHODOLOGY • Main source of data is ERM database of ERRA & MIS database of PPAF(Pakistan Poverty Elevation Fund) • Literature review - exhaustive list of critical success and failure • From studies mention above 68 project success/failure factors for ERRA reconstruction programme was concluded • A 68 factors survey questionnaire was used where the respondents were asked to assess the critical success and failure factors, both on their perceived importance and on the extent of their presence in the reconstruction project. • A total of 74 completed responses were received, giving a response rate of 40%. • Framework & strategy for reconstruction projects success is proposed • Recommendations for improvement and conclusion
  • 11. WORLDWIDE EARTHQUAKE MORTALITY Top 10 Earthquakes Globally by Mortality (1970-2009) Persons Persons Date Country Richter killed affected July 27th, 1976 China 7.8 242,000 164,000 Indian Ocean Dec 26th, 2004 9 226,000 2,432,000 tsunami May 12th, 2008 China 7.9 88,000 45,977,000 Pakistan & October 8th, 2005 7.6 75,000 5,285,000 India, May 31st, 1970 Peru 7.8 67,000 3,216,000 June 21st, 1990 Iran 7.3 40,000 710,000 Dec 26th, 2003 Iran 6.6 27,000 268,000 Dec 7th, 1988 Armenia 6.9 25,000 1,642,000 Sept 16th, 1978 Iran 7.7 25,000 40,000 Feb 4th, 1976 Guatemala 7.5 23,000 4,993,000 Source: Data extracted from CRED (2010 ) EM-DAT International Disaster Database
  • 12. ECONOMIC DAMAGES & NUMBER OF EARTHQUAKE • Earthquakes were responsible for 29% of natural disaster-related deaths in the last 30 years but accounted for 58% of fatalities in the last decade • 56% of all earthquakes happened in Asia, causing 90% of global earthquake fatalities Economic Damage Country Date Magnitude (Billion US $) Japan Jan 17, 1995 7.2 140.4 China May 12, 2008 7.9 84.4 United State Jan 17, 1994 6.6 43.3 Japan Oct 23,2004 6.6 31.7 Turkey Aug 17,1999 7.4 25.7 Italy Nov 23, 1980 7.2 51.9 Taiwan Sep 21, 199 7.6 18.1 Russia Dec 7, 1988 6.9 25.3 Japan Jul 16, 2007 6.8 12.9 Iran Jun 21, 1990 7.3 13.1 Source: EM-DAT: The OFDA/CRED International Disaster Database
  • 13. SEISMIC ZONES OF PAKISTAN
  • 14. 7.7 MAGNITUDE EARTHQUAKE IN QUETTA – 1935 Lytton Railway Road Station 35,000 deaths Bruce Street, Quetta, before & after the earthquake
  • 15. WORLDWIDE NATURAL DISASTER TRENDS A particularly high number of disasters occurred recently. Fact is that almost 270 large natural disasters have appeared since 1955 Source: EM-DAT - International Disaster Database www.emdat.be University catholique de Louvain Brussels – Belgium
  • 16. TOP TEN NATURAL DISASTER BY ECONOMIC DAMAGES The disasters with the highest economic impact occur primarily in highly developed countries Total damages Year Country or Region Event Rank (mill. US $) 2005 USA Hurricane Katrina 125,000 1 1995 Japan/Kobe Earthquake 100,000 2 1994 USA/Northridge Earthquake 44,000 3 1998 China/Yangtze region Flooding 30,700 4 2004 Japan Earthquake 28,000 5 1992 USA/Florida Hurricane Andrew 26,500 6 1996 China/Yangtze region Flooding 24,000 7 2004 USA/Caribbean Hurricane Ivan 23,000 8 1993 USA/Mississippi Flooding 21,000 9 2004 USA/Caribbean Hurricane Charley 18,000 10 Source: Schenker-Wicki et al. (2010) ‘Unmastered risks: From crisis to catastrophe, An economic and management insight ‘,Journal of Business Research, 63, 337–346.
  • 17. PROJECT SUCCESS CRITERIA Criteria used for judging Project Ranking Success Meets client’s requirements 1 Completed within schedule 2 Completed within budget 3 Meets organizational objectives 4 Yield business & other benefits 5 Causes minimal business disruption 6 Meets quality/safely standards 7 Other criteria 8 Source: Data extracted from White, D. & Fortune J. (2002) ‘Current practice in project management an empirical study’, International Journal of Project Management, pp.1-11
  • 18. CRITICAL FAILURE FACTORS A project is considered failed if it falls short in achieving the planned objectives, goals or is unable to achieve stated & agreed tasks within given constraints Critical failure factors extracted from literature are; conflict among project participants lack of knowledge hostile socio economic and climatic condition reluctance in timely decision short bid preparation time bad political influence bribes etc The construction industry is the worse affected by corruptions Source: K.C. Iyer and K.N. Jha (2005), ‘Factors affecting cost performance: evidence from Indian construction projects’, International Journal of Project Management, 23; 283–295
  • 19. PART – III CASE STUDY OF THE OCTOBER 2005 EARTHQUAKE RECONSTRUCTION PROJECTS
  • 20. POPULATION AFFECTED: 3.5 M Gilgit Kalam M-7.6 Fault Line 100 KM Long Pattan Mingora Batgram Kaghan •Human Loss - 73,338 Balakot •Injured - 1,28,309 GHB •Families Affected - 500,000 Muzaffarabad Mardan Mansehra Peshawar Abbotabad Bagh Arja Rwkt Islamabad Rawalpindi AREA AFFECTED - 30,000 SQ KM 20
  • 21. ECONOMIC IMPACTS OF 2005 EARTHQUAKE • Overall cost associated with the earthquake is estimated at approximately US$5.198 billion • Direct total damage sustained due to the earthquake was Rs. 135.1 billion (US$2.3 billion) • The largest component of this damage is private housing, which amounts to Rs. 61.2 billion (US$1.03 billion), followed by damage to the transport sector totaling Rs. 20.2 billion (US$340 million) • Cost of reconstruction of lost assets and of the restoration of public services is estimated to be Rs. 208 billion (US$3.5 billion) Source: The Asian Development Bank and World Bank (2005) Pakistan 2005 Earthquake: Preliminary Damage and Needs Assessment, Islamabad
  • 22. DISTRIBUTION OF RESPONSIBILITIES • After the earthquake Government quickly established the Federal Relief Commission (FRC) on October 10, 2005, to supervise and coordinate relief efforts • Later stages of recovery, reconstruction and rehabilitation were left to the ERRA which was formed in January 2006. The key actors in the new organizational structure for reconstruction of quake-hit areas include: − ERRA as a central agency responsible for coordinating, macro planning, financing, project approval and monitoring − Secretariats servicing governments in KPK & in AJK is responsible for provincial/state strategy formulation; the secretariats are known as the Provincial Earthquake Reconstruction & Rehabilitation Authority (PERRA) in the province & the State Earthquake Reconstruction & Rehabilitation Authority (SERRA) in AJK. The basic mandate of implementation of all reconstruction projects rest with these forums − District reconstruction units in each district to execute all reconstruction and rehabilitation projects Source: ERRA, Annual review 2006-2007
  • 23. ERRA RECONSTRUCTION & REHABILATION PROGRAMME ERRA programme is divided into two parts: 1.Owner-driven housing programme, which was for 600,000 homes 2.The other part of the programme consists of about 13,312 projects in 11 different sectors and three cross- cutting programmes at a cost of over US$ 5 billion Projects construction summery of all Projects Owner-driven Housing as on 10 Aug, 2011 Programme Source: Developed from data provided by ERRA
  • 24. PHYSICAL PROGRESS ANALYSIS OF ERRA PROJECTS • Monthly progress reports of ERM database was collected from all District Reconstruction Units for last one year Number of Projects Percentage Total Projects: 13,312 Allocated: 13,312 100.00 % Unallocated 0 0.00 % Stages Completed 7357 55.27 % Under Construction 3868 29.06 % Tendering 1677 12.60 % Designing 393 2.95 % Planning 17 0.05 % Source: Developed from data provided by ERRA
  • 25. PHYSICAL PROGRESS ANALYSIS OF PROJECTS IN TERM OF FUNDING SOURCE • In term of funding sources, all projects can be divided into 3 separate groups, GOP funded projects, donor funded projects and sponsor funded projects • Physical progress of Sponsor funded projects is highest and GOP funding projects are lowest • Combination of fielding inexperienced staff or incompetent contractors to manage very complex projects in a shifting policy and cost escalation environment is leading to significant failure in term of delivery timing and cost drift Designing & Completed Under construction Tendering Planning Funding Total Total Number of Projects Source Projects No. % No. % No. % No % 76-95% 51-75% 26-50% 0-25% GOP 8,713 3,290 37.76 3,505 40.23 547 738 911 1,309 1,575 18.08 330 3.79 Donors 1,130 881 77.96 197 17.43 30 62 68 37 33 2.92 19 1.68 Sponsors 3,469 3,186 91.84 166 4.79 49 40 31 46 69 1.99 44 1.27 All 13,312 7,357 55.27 3,868 29.06 626 840 1,010 1,392 1,677 12.60 393 2.95 Source: Developed from data provided by ERRA
  • 26. CURRENT STATUS OF ALL ERRA’s PROJECTS 7343 projects are completed before August 10, 2011, total under construction projects are 3868 while 1877 projects are still at designing and tendering stages. The physical progress of Social Sector projects is the lowest (13.33%) and Livelihood Sector projects are the second lowest (18.96%). These projects are government funded and inadequate availability of resources and lack of money is the main reason for slow progress in above two sector buildings. Total Designing & Completed Under Construction Tendering District Projects Planning No. No. % No. % No. % No. % Grand Total 13312 7357 55.27% 3,868 29.06% 1,677 12.60% 410 3.08% Education 5,751 2,055 35.73% 2,151 37.40% 1,334 23.20 212 3.67% Environment 466 160 34.33% 293 62.88% 13 2.79 0 0.00% Governance 697 392 56.24% 258 37.02% 47 6.74 0 0.00% Health 306 162 52.94% 97 31.70% 41 13.40 6 1.96% Livelihood 1,076 204 18.96% 489 45.45% 205 19.05 178 16.54% Medical 6 6 100.0% 0 0.00% 0 0.00 0 0.00% Rehabilitation Power 15 10 66.67% 2 13.33% 0 0.00 3 20.00% Social Protection 15 2 13.33% 7 46.67% 6 40.00 0 0.00% Telecommunicatio 1 1 100.0% 0 0.00% 0 0.00 0 0.00% n Transport 233 137 58.80% 84 36.05% 11 4.72 1 0.43% WatSan 4,746 4,228 89.09% 487 10.26% 20 0.42 11 0.23%
  • 27. RECONSTRUCTION PROGRESS AS ON 10 August, 2O11 Reconstruction Project Progress Yearly-wise Reconstruction Summary
  • 28. ANALYSIS, RESULTS AND DISCUSSION
  • 29. DATA COLLECTION • Main source of data is ERM database of ERRA and MIS database of Pakistan Poverty Elevation Fund • Data is also collected from different NGOs, United Nation agencies, NESPAK, contractors, C&W Mansehra, PWD Neelum, District Reconstruction Units etc. • Different nature of reconstruction projects in earthquake affected areas of Pakistan are selected, which have been executed in the last five years with at least Rs. 1 Millions worth • The financial and scheduling data of all the ERRA 13,312 small and large projects have been collected and it has been analyzed by using the some performance indicators, earn value analysis and in light of executers opinions • Project success & failure factors are extracted from this process
  • 30. Cont’d • 185 questionnaires were send to construction professionals of Pakistan, selected randomly from across the quake-hit areas • A total of 74 completed responses were received Project Classification of Respondents’ Nature of Organization Respondents
  • 31. DATA EVALUTION • A four-point Likert scale was used to measure the factor influence on overall performance of reconstruction projects • The individual numerical ratings of each of the identified factors were transformed to relative importance indices to assess the relative ranking of factor by using the following formula • RII= ∑X/(A*N) , (O < RII < 1) Where − RII = relative importance index. − X = rating given to each factor by the respondent; ranging from 1 to 4 where '1’ is not effective at all and '4' is extremely effective − A = highest rating (i.e. 4 in this case) − N = total number of respondents responding to that factor • The biggest value of RII of a factors indicates the most important success factors with rank one and the smallest value of RII indicates the most critical failure factors with rank one & so on • Statistical Package for the Social Sciences (SPSS) was used to find correlation in ranking among different responding groups Source: Daniel W.M. Chan , Mohan M. Kurnaraswarny (2002) International Journal of Project Management, vol.20, pp. 23-35
  • 32. Analysis of Success Criteria from Questionnaire’s Feedback Discussion − Ranking of all success criterions was obtained by computing RII for overall sample as well as separately for all responding groups − Respondents are conscious about the popular ‘Iron Triangle’ of construction industry, that is “completion on time, under budget & according to specifications” Result: • Top ranked success criteria are completion ‘within schedule’, ‘within budget’, ‘stakeholders satisfaction’, ‘meet specifications’ and ‘high quality of workmanship’ Cont’d
  • 33. SOLICITATION OF RECONSTRUCTION PROJECT SUCCESS & FAILURE FACTORS • Depending upon mean scores of responses for various factors, the factors were segregated in three groups: the first group (with µ≥ 3.0) that showed positive contribution; the second group (with 3.0 < µ < 2.35) which was neutral, having no significant impact on the project success and the third group (with µ≤ 2.35) indicating negative impacts • Factors of first group (µ≥ 3.0) were arranged on their descending order of RII values and ranked • Factors of the third group (with µ≤ 2.35) were arranged in ascending order of the RII and ranked. The lowest RII indicates the most critical failure factor with rank 1 and so on Ranges of mean values Group 1 Group 2 Group 3 µ≥ 3.0 3.0 < µ < 2.35 µ≤ 2.35 14 factors 24 factors 17 factors Success Neither positively contributing nor Adversely factors adversely affecting affecting
  • 36. Post-disaster Reconstruction Project Success Factors S. No Critical project success factors (µ≥ 3.0) RII Mean Rank 1 Clarity of goals and directions of the project 0.889 3.554 1 2 Detailed planning of project 0.855 3.419 2 3 A full-time and experienced project manager 0.834 3.338 3 4 Clear & detailed written contracts 0.814 3.257 4 5 Effective monitoring and feedback 0.801 3.203 5 6 Projects management skills 0.794 3.176 6 7 Frequent meetings among various stakeholders 0.780 3.122 7 Project team members possess adequate capabilities & 8 0.774 3.095 8 experience 9 Extent of rewarding high performing staff and motivation 0.767 3.068 9 10 Sufficient capacity of contractors 0.764 3.054 10 11 PM ability to handle contingencies & deviations from plan 0.760 3.041 11 12 Adequate communication among related parties 0.756 3.021 12 13 Training human resources in the skill demanded by the project 0.752 3.011 13 14 Client’s clear and precise definition of project scope & objectives 0.750 3.000 14
  • 37. Post-disaster Reconstruction Project Failure Factors S.No Critical Failure Factors for Construction Projects (µ≤ 2.35) RII Mean Rank 1 Inadequate availability of resources (funds, material etc.) 0.443 1.77 1 2 Finance problems and payments of completed work 0.449 1.797 2 3 Lengthy decision taking process & reluctance in timely decision by stakeholders 0.483 1.932 3 4 Excessive subletting 0.517 2.068 4 5 Centralized system by ERRA 0.531 2.123 5 6 Inappropriate cost and time estimation 0.530 2.122 6 7 Shortages of skilled man-power, experienced professionals 0.536 2.148 7 8 Increasing energy, material, labor prices & their shortages 0.537 2.149 8 9 Vulnerability of roads and difficult access to site 0.540 2.161 9 10 Political support 0.541 2.162 10 11 Mistakes/ delays in producing design documents & drawings 0.551 2.203 11 12 Complexity and large size of reconstruction project 0.554 2.216 12 13 Work suspensions owing to conflicts 0.557 2.23 13 14 X-Factor (fraudulent practices, corruption, favoritism etc.) 0.574 2.297 14 15 High cost of skilled labor & high transportation costs 0.578 2.311 15 16 Capacity of line departments 0.5810 2.323 16 17 Harsh climatic condition 0.5811 2.324 17
  • 38. SOLICITATION OF ERRA’S RECONSTRUCTION PROGRAM FOR MONITORING & MANAGING PURPOSE The "normal" pace of project implementation is simply not good enough to address the urgent needs of the people affected by the earthquakes ICT tools (wireless communication, webmail, database bank) are keys to identify the gaps in reconstruction delivery The online database may provide a tool to track the physical progress of implementing agencies ERRA need to classifying delayed projects into 4 categories, based on the partner’s frequency of updating their data on the online databank. Concepts related to managing and monitoring of the reconstruction programme of ERRA − Halted Projects − Delayed Projects − Snailing Progress (Time Overrun Projects) − Awaiting Progress
  • 39. HALTED PRJECTS • A project becomes halted if more than 3 months have passed and no physical progress is received. Halted Projects are further categorized into the following categories: − Halted - No Work Started: Commencement order is issued but work has not started since 3 months or more. The project should have zero % physical progress − Halted - Sick Projects: Construction is stopped between 1% and 80% since 3 months or more − Halted - Stuck Projects: Construction is stopped between 81% and 95% since 3 months or more
  • 40. Cont’d Detail of Sector wise Halted Projects as on 10 August, 2011 Sector Under Total Halted No Work Started Sick Stuck Construction NO. % NO. % NO. % NO. % Grand Total: 3868 2322 60.03 194 5.02 1950 50.41 178 4.60 Education 2,151 1,301 60.48 117 5.44 1,101 51.19 83 3.86 Environment 293 163 55.63 8 2.73 138 47.10 17 5.80 Governance 258 172 66.67 6 2.33 149 57.75 17 6.59 Health 97 4 4.12 0 0.00 2 2.06 2 2.06 Livelihood 489 243 49.69 29 5.93 206 42.13 8 1.64 Power 100.0 2 2 100.00 0 0.00 2 0 0.00 0 Social Protection 7 5 71.43 0 0.00 5 71.43 0 0.00 Transport 84 28 33.33 1 1.19 22 26.19 5 5.95 WatSan 487 404 82.96 33 6.78 325 66.74 46 9.45 Result • Lack of funding, increase in taxes because of August 2010 flood, remote hilly areas, location of some sites directly below the high voltage power line and shortage of technical persons is the main reasons for stopping of work at these projects
  • 41. DELAYED PROJECTS • When a project fails to achieve the planned progress and lags behind the schedule, it is declared delayed whether the time is over run or not. Difference between planned & actual progress should be 30% or more for delayed projects. The delayed projects are further categorized into the following categories − Delayed - Slow Progress: Difference between planned and actual progress is between 30% and 49% − Delayed - Sick Projects: Difference between planned and actual progress is between 50% and 74% − Delayed - Critical Projects: Difference between planned and actual progress is equal to or greater than 75%
  • 42. Cont’d 2944 number of projects is declared Delayed at 10 August, 2011 Delayed Projects Under Slow Total construction Total Progress Sick Critical Sector Projects No % No % No % No % No % Grand Total: 13312 3868 29.06 2746 70.99 641 16.57 962 24.87 1143 29.55 Education 5,751 2,151 37.40 1,692 78.66 388 18.04 541 25.15 763 35.47 Environment 466 293 62.88 200 68.26 49 16.72 50 17.06 101 34.47 Governance 697 258 37.02 175 67.83 44 17.05 61 23.64 70 27.13 Health 306 97 31.70 24 24.74 12 12.37 10 10.31 2 2.06 Livelihood 1,076 489 45.45 275 56.24 52 10.63 106 21.68 117 23.93 MR & Telecom 6 0 0.00 0 0.00 0 0.00 0 0.00 0 0.00 Power 15 2 13.33 0 0.00 0 0.00 0 0.00 0 0.00 Social Protection 15 7 46.67 7 100.00 6 85.71 1 14.29 0 0.00 Transport 1 0 0.00 0 0.00 0 0.00 0 0.00 0 0.00 WatSan 233 84 36.05 42 50.00 17 20.24 17 20.24 8 9.52 Result • Generally government of Pakistan faces shortage of funds in financial allocation to ERRA’s projects and projects more than the available finances are started which later on causing delay in payment to contractors. When the contractors do not receive their payments then they also stop paying to their supplier and labour. These scarcities of cash flow cause the project delay
  • 43. SNAILING PROGRESS (TIME OVERRUN PROJECTS) Construction pace of Snailing Progress Projects is very slow. They can not be called “Halted (Sick/Stuck)” because they do some progress in 90 days. They do not fall under the category of delayed projects because the difference between planned and actual progress is less than 30% −Non imposition of penalty/liquidity damage by the consultant, subletting of contracts, critical technical observations, poor condition of road, price hike in construction material and procedural delays by clients are the some reasons of time overrun project Detail of Snailing Progress Projects at 10 August, 2011 Number of Projects Under Time Over Run Sector Construction Total Up to 3 10-12 > 12 4-6 Months 7-9 months Months Months Months Grand Total: 3,868 296 5 20 37 20 214 Education 2,151 155 4 12 28 13 98 Environment 293 63 0 8 5 2 48 Governance 258 33 0 0 0 1 32 Health 97 0 0 0 0 0 0 Livelihood 489 19 0 0 0 0 19 Transport 84 15 0 0 3 1 11 WatSan 487 11 1 0 1 3 6
  • 44. AWAITING PROGRESS • A project is considered member of this group if more than 49 days have passed and no progress is received • If there is no improvement in progress on a project of this group than after 90 days the project will automatically become “Halted (No Work Started/Sick/Stuck)” and disappear from awaiting progress report group • Result: − This awaiting progress report will give an early warning to managers that the progress of project is not received since long − Sector wise detail of Awaiting Projects (Waiting since 50 to 89 days) Awaiting No Work Total Awaiting Sick Awaiting Stuck District Started No. No. % No. % No. % Grand Total 527 16 3.04 374 70.97 137 26.00 Education 199 0 0.00 174 87.44 25 12.56 Environment 45 0 0.00 32 71.11 13 28.89 Governance 27 0 0.00 23 85.19 4 14.81 Health 31 1 3.23 24 77.42 6 19.35 Livelihood 189 15 7.94 90 47.62 84 44.44 Transport 19 0 0.00 17 89.47 2 10.53 WatSan 17 0 0.00 14 82.35 3 17.65 Transport 19 0 0.00 17 89.47 2 10.53
  • 46. Comprehensive Framework for Reconstruction Project Success
  • 47. Framework for Effective Post-disaster Recovery Process in Pakistan
  • 48. Organizational Models for Recovery Projects in Pakistan 1) Create new dedicated organization or task force − Seriously consider this option for large-scale disasters − Formulate the exit strategy to avoid agency surviving beyond its mission 2) Dedicated organization drawn from existing line ministries − It may undermine ongoing non-disaster programs − International agencies may not finance backfilling of normal ministry functions 3) Existing Governmental Agencies Manage Recovery under National Disaster Plan − This model needs detailed pre-disaster planning, staff training & national disaster plan − It requires existing line ministries to be strengthened with experienced staff
  • 49. RECOMMENDATION AT NATIONAL LEVEL • All stages of a disaster response should be handled by the same dedicated permanent institution • Development of human resource to cater for global disasters from rescue to reconstruction • Establish worldwide linkage between government and NGOs and share experience with disaster-hit countries • Government should specify rates periodically based on requirement and price escalation • Approach for housing reconstruction after mega disaster should be owner driven • Time and cost schedule for site in remote areas should be flexible along with special incentives to attract NGOs and contractors to far flung areas • Progress analysis of projects should be carried out by client, consultant and contractor to know whether the project is successful • Project success criteria and KPIs should be developed at the initial stages of project before implementation • As there are different requirements and special targets of any given project, success measurement should also be tailored for each project • The earned value analysis of the projects should be carried out during execution of projects to control/monitor the project to see whether the project is on schedule and within budget or not
  • 50. FUTURE RESEARCH DIRECTIONS − Comprehensive analysis of the causes of success and failure at the end of reconstruction projects in disaster affected areas of Pakistan − Project success criteria and key performance indicators for construction projects in Pakistan − Assessment of critical success and failure factors in other industries in Pakistan − Establishment of a comprehensive benchmarking system to determine the performance of mega development projects in government sector − Establishment of a clear link between critical success factors and project success criteria − Analysis of cost overrun and delays in post disaster recovery projects in Pakistan − Role analysis of consultants, contractors, relief and recovery organization after mega disaster in Pakistan − Project success factors and criteria for aid agencies in the World − Impact assessment of post disaster reconstruction projects to examine how beneficiaries perceive the performance of reconstructed facilities