Impact of the Pandemic COVID-19 on the Implementation of Construction Contracts

Abstract

The COVID 19 pandemic has affected various sectors in the world, including the construction sector in Indonesia. The biggest impact is the impact on the health sector and the economy. The government budget for the construction sector has been cut very significantly, which has a negative impact on stakeholders, especially causing financial problems for business actors in construction. In this study, the identification of the impact of the COVID 19 pandemic was carried out on the construction sector, especially in the implementation of contracts. The research method used is through a quantitative analysis with questionnaire data which is distributed to stakeholders involved in the implementation of construction contracts. The results of identification study through questionnaires show that 80% of construction projects are still running in the current COVID 19 pandemic condition. However, pandemic conditions affect project performance, especially at the time of project completion. In addition, in implementing the health protocol, assistance, additional costs, improvement of human resource capacity, and special equipment are required, so that the health protocol can be implemented properly. On the other hand, most stakeholders stated that the online coordination system during the pandemic for the implementation of construction projects tends to be less effective. Hopefully, the research results can provide direction in finding the best strategy to reduce the impact of the COVID 19 pandemic on the construction sector, both in terms of health and project performance.

Managerial Responses to the Onset of the COVID-19 Pandemic in Healthcare Organizations Project Management

“…A significant part of the obtained results is consistent with the experiences of organizations from other sectors of the economy (particularly commercial businesses). This mainly concerns the significant role of risk analysis in project management under crisis conditions [117,118], the negative impact of the COVID-19 pandemic on the performance of implemented projects [65][66][67][68] and the significant impact of the pandemic on the organization of work of project teams, particularly including the introduction of rules for remote work [74,78,119]. Regarding the anticipated changes in the area of project management, the results correspond directly with conclusions concerning the increased importance of risk management [86], and the progress of virtualization and digitization in project management in the future [89,90], in addition to H4.0 adaptation in terms of building resilience of healthcare organizations.…”

“…The dynamic and unexpected materialization of multiple risks related to the COVID-19 pandemic may, in many cases, have a negative impact on the performance of the implemented projects. This can be seen, in particular, in the construction industry [63][64][65], where the COVID-19 pandemic had a negative impact on the timely implementation of construction projects. The results of other research indicate that the pandemic also had a negative impact of the performance of projects in the energy sector [66], infrastructure [67] or crowd-funding projects [68].…”

Implementation of Management of COVID-19 Prevention and Control at PT. X

“…Based on the interviews with several informants, it was stated that the COVID-19 pandemic caused a considerable impact, especially in projects that caused some projects to be hampered or withdrawn due to worker restrictions. Following research conducted by Larasati et al (2021), it was stated that the COVID-19 pandemic caused more than 50% of construction contracts to change, the most significant change in the implementation time clause. Some stakeholders responded to the pandemic by reducing the on-site workforce, automatically impacting turnaround time.…”

New Modes of Operating for Construction Organizations during the COVID-19 Pandemic: Challenges, Actions, and Future Best Practices

“…Their results showed that the novelty and criticality of the pandemic improved several dimensions of OCB or construction employees, such as their compliance and dedication. Larasati et al (2021) developed a questionnaire to investigate the impact of the COVID-19 pandemic on the implementation of construction contracts. Their results showed that the pandemic had a significant impact on the implementation of construction contracts, especially at the planning stage of projects.…”