Determinants of Subcontracting Performance in Road Construction Projects: Case of Addis Ababa Road Projects

Abstract: The study aims to examine the current subcontracting performance and its determinants in Addis Ababa city road authority road projects.It is descriptive and explanatory type.A sample of 51 representatives, 9 contractors, 32 subcontractors and 10 consultants, involved in AACRA projects during 2012-2017 have participated on the study. Major determinants (22) of subcontracting performance have been identified from literature reviews. The stakeholders? score on these determinants have been ranked by the use of relative Importance Index (RII). Then the underlying four determinants of subcontracting performance have been extracted using a factor analysis from the top ten determinants. The effect of these underlying determinants on subcontracting performance is studied by a binary logistic regression. Initial subcontractor selection and document preparation problem, Poor performance of the subcontractor, cooperation problems and delay of progress payments are the significant determinants of subcontracting performance on time dimension. Initial subcontractor selection and document preparation problem, poor performance of the subcontractor and cooperation problems are the significant determinants of subcontracting performance on cost and quality dimensions. Contractors are suggested to select their subcontractors properly with preset criteria and prepare subcontract document with precaution. Subcontractors need to improve the quality of their works and meet schedules. AACRA and the consultants need to be involved on selection and evaluation of subcontractors. Subcontracting is dominated by labor-only subcontracting but needs to widen up to other subcontracting types. AACRA need to prepare a subcontracting policy, guidelines and a modality for minimum percentage for subcontract works.