DEVELOPMENT OF A WHOLE-LIFE COST IMPLEMENTATION FRAMEWORK FOR THE NIGERIAN CONSTRUCTION INDUSTRY

By

Author

Presented To

Department of Environmental Design

ABSTRACT
Whole Life Cost (WLC) decision-making technique offers immense benefit to building investors as it captures not just the initial cost but also the maintenance, running and terminal costs of proposed buildings. Its application however is constrained by the absence of a standard implementation framework. This research effort was geared towards the development of an implementation framework that addresses; the legal requirement for WLC within the Nigerian construction industry; the limitations of existing frameworks; and major implementation challenges. First the legal requirement for WLC was articulated; the strength and weaknesses of existing frameworks was then assed based on some identified criteria; solutions to some of the critical implementation challenges were then identified through a mixture of theoretical survey, and structured interviews. The entire solution frame was then organised, integrated and harmonised into a framework structure. The framework was then improved by transforming it into programme flowcharts and interfaces to facilitate computer implementation. Result shows that substantial legislations, regulations and guidelines that facilitate the use of WLC are well established. Besides, none of the existing frameworks fully satisfy problem-solving, project life-cycle, and feedback requirement. A profiling of WLC Implementation challenges indicates that client?s lack of demand/ understanding, data scarcity, process complexity, and high level of risk and uncertainty are the most severe. In an attempt to mitigate these limitations, a conceptual framework was proposed. The framework utilises a relational database, a model selection framework and two mathematical models: Modified traditional model which enables the identification of the best alternative based on payback period, net present/net future values, and break-even point and; an Options appraisal model which facilitates the evaluation of embedded WLC opportunities. The present value options appraisal model enables the xxi determination of the optimum investment time thereby improving the decision horizon from two-way to five-way. It also provides estimate of benefit to cost ratios, profitability index on both the net present values and option value. Test result indicates that the database is effective in terms of: storage and retrieval of multiple data types, preservation of data integrity, and ensuring user-friendliness. Furthermore, the test result confirms the efficacy and robustness of: the transformation and integration algorithms in converting one data type to another, and the modified WLC and the options appraisal models. It was recommended that building professionals and consultants be aware of the existence of legal provisions for WLC and also get prepared to take on the challenge placed upon them. They must understand that traditional procurement on the basis of initial cost alone is no more tenable and redirect their attention to the use of WLC as it gives the public better value for money and as such becomes imperative at especially the present times in which the country is experiencing recession. It is anticipated that the framework would improve the usability of WLC in the industry by providing both private and public sector with a robust analysis tool that would facilitate long term property investment decision making.