• Journal of the Korea Institute of Building Construction
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• v.21 no.2
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• pp.149-156
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• 2021

This study empirically verified whether aggressive order intake affect occurrence of defects of Korean construction companies. In order to compensate for the shortage of construction costs due to aggressive low-cost orders of contractors, self-response measures such as design changes are followed, and construction defects may be induced in this process. It aims to verify relevance between aggressive order intake and defect in construction empirically using financial accounting data. As a result, it was confirmed that an abnormal increase in order volume and a deterioration in profitability such as operating margin due to aggressive order taking behavior leads to a decrease in construction quality and occurrence of defects. In addition, it was also confirmed that low construction ability and intentional changes in construction design or contract conditions after construction commences were a direct causes of defects. The results of this study can serve as an opportunity to come up with measures to prevent defects by confirming the relationship between defects in construction and deterioration of profitability due to aggressive low-cost order takings.