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Impact of cash flow variation on project performance: contractors’ perspective

Author

Listed:
  • Tarawneh Sultan

    (Mutah University, Applied Science Private University, Jordan)

  • Almahmoud Anoud Fawwaz

    (Mutah University, Jordan)

  • Hajjeh Hassan

    (Applied Science, Private University, Jordan, MEU Research Unit, Middle East University, Amman, Jordan)

Abstract

This study aims to determine the impact of cash flow variation in Jordanian construction projects from contractors’ perspective and its relationship with project performance. An online questionnaire was developed and distributed to a selective sample. The respondents were project managers from contracting companies working in Jordan, around 340 construction companies. The sample frame was a form of non-probability sampling of 181 project managers. The collected data were analysed using the Statistical Package of the Social Sciences (SPSS) version 25. The study results showed a positive statistically significant effect at the significance level (α ≤0.05) of cash flow variation on project performance in Jordanian construction projects. In addition, respondents indicated a high level of agreement on the impact of cash flow variation on projects’ performance, with a mean of 4.01 and a standard deviation of .546. However, on the project performance dimensions’ level, Quality came first, with a mean of 4.11 and at a high level, followed by Safety, with a mean of 4.01 and at a high level, while Final Cost ranked third with a mean of 3.96 and at a high level. Finally, Project Final Duration ranked fourth with a mean of 3.95. The researchers recommended the necessity of more efforts for a better understanding of the importance of cash flow by contractors to schedule project activities correctly and efficiently to maintain a steady state of the project cash flow.

Suggested Citation

  • Tarawneh Sultan & Almahmoud Anoud Fawwaz & Hajjeh Hassan, 2023. "Impact of cash flow variation on project performance: contractors’ perspective," Engineering Management in Production and Services, Sciendo, vol. 15(1), pages 73-85, March.
    • Handle: RePEc:vrs:ecoman:v:15:y:2023:i:1:p:73-85:n:3
    DOI: 10.2478/emj-2023-0006
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    References listed on IDEAS

    as
    1. Hasan Mahmoud & Vian Ahmed & Salwa Beheiry, 2021. "Construction Cash Flow Risk Index," JRFM, MDPI, vol. 14(6), pages 1-17, June.
    2. McInnis, John & Collins, Daniel W., 2011. "The effect of cash flow forecasts on accrual quality and benchmark beating," Journal of Accounting and Economics, Elsevier, vol. 51(3), pages 219-239, April.
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