Steering towards pinnacle of success : the NEC tenets in Australian construction contracting

Contractual relationships have become increasingly strained in recent years in the construction industry result in the use of the judicial system for the settlement of contractual disagreements. Why is this so? Evidence from anecdotes suggest that the lack of capacity amongst owners and contractors to carry out a contract using a good practice approach during the construction of a project contribute to the occurrence of conflicts, losses, deficient contractual relationships and poor performance of the construction work. Recognizing that current forms of contract in use today perpetuate a legacy of construction problems, we are conducting explanatory research to examine whether the widely publicized benefits of New Engineering Contract (NEC) could be realized in the Australian construction industry. This paper outlines a research agenda that will help shed light on how contract forms are able to be used as a mechanism to ensure construction projects are delivered successfully whilst also meeting the goals of multiple stakeholders. Understanding the Critical Success Factors (CSFs), commonly used construction contracts and the NEC system can help us address some of these issues. However, there are gaps in the validation of the benefits of NEC and its link with project success. We identify some of these gaps and propose a methodology by which to gain insights into this phenomenon. Keywords: Project Success, Construction Contracting, New Engineering Contract (NEC)

Construction performance and organisational culture

The purpose of this paper is to summarize the outcomes of a detailed research study carried out as part of the fulfilment of a doctoral programme which examined the relationships between, and impacts of organisational culture on construction performance within a Hong Kong context. The research used a mixed methodology approach consisting of an organisational culture survey using an adapted validated and reliable measurement instrument (the Denison Organisational Culture Survey), mini-case studies in four Hong Kong construction companies and correlated the derived culture scores against performance scores measured by the Hong Kong Housing Department Performance Assessment Scoring System (PASS). The significance of the research was to advance knowledge of the importance of organisational culture strength as a performance driver in the construction industry and the further proof of the culture performance links using a set of measures of the latter which were not financially-based. The findings of the research make a contribution to theory by further validating the work by Denison (1990) and others, not only in that a successful link between organisational culture and performance was demonstrated, but it also identifies particular cultural factors in organisations that appear to be significantly responsible for achieving successful outcomes and reveals opportunities for further research into the organisational culture of construction companies Keywords: organisational culture, construction performance, business success.

Responding to sustainability challenge and cost implications in highway construction projects

Highway construction often requires a significant capital input; therefore it often causes serious financial implications for developers, owners and operators. The recent industry-wide focus on sustainability has added a new dimension to the evaluation of highway projects, particularly on the economical scale of ‘going green’. Comprehensive analysis of the whole-of-life highway development that responds to sustainability challenges is one of the primary concerns for stakeholders. Principles of engineering economics and life cycle costing have been used to determine the incremental capacity investments for highway projects. However, the consideration of costs and issues associated with sustainability is still very limited in current studies on highway projects. Previous studies have identified that highway project investments are primarily concerned with direct market costs that can be quantified through life cycle costing analysis (LCCA). But they tend to ignore costs that are difficult to calculate, as those related to environmental and social elements. On a more positive note, these studies proved that the inclusion of such costs is an essential part of the overall development investment and a primary concern for decision making by the stakeholders. This paper discusses a research attempt to identify and categorise sustainability cost elements for highway projects. Through questionnaire survey, a set of sustainability cost elements on highway projects has been proposed. These cost elements are incorporated into the extension of some of the existing Life Cycle Costing Analysis (LCCA) models in order to produce a holistic financial picture of the highway project. It is expected that a new LCCA model will be established to serve as a suitable tool for decision making for highway project stakeholders.

Incorporating sustainability measures in life-cycle financial decision making for highway construction

Public awareness and the nature of highway construction works demand that sustainability measures are first on the development agenda. However, in the current economic climate, individual volition and enthusiasm for such high capital investments do not present as strong cases for decision making as the financial pictures of pursuing sustainability. Some stakeholders consider sustainability to be extra work that costs additional money. Though, stakeholders realised its importance in infrastructure development. They are keen to identify the available alternatives and financial implications on a lifecycle basis. Highway infrastructure development is a complex rocess which requires expertise and tools to evaluate investment options, such as environmentally sustainable features for road and highway development. Life-cycle cost analysis (LCCA) is a valuable approach for investment decision making for construction works. However, LCCA applications in highway development are still limited. Current models, for example focus on economic issues alone and do not deal with sustainability factors, which are more difficult to quantify and encapsulate in estimation modules. This paper reports the research which identifies sustainability related factors in highway construction projects, in quantitative and qualitative forms of a multi-criteria analysis. These factors are then incorporated into past and proven LCCA models to produce a new long term decision support model. The research via questionnaire, model building, analytical hierarchy processes (AHP) and case studies have identified, evaluated and then processed highway sustainability related cost elements. These cost elements need to be verified by industry before being integrated for further development of the model. Then the Australian construction industry will have a practical tool to evaluate investment decisions which provide an optimum balance between financial viability and sustainability deliverables.

An assessment of construction labour productivity in Malaysia

The construction industry is one of major strategic importance. Its level of productivity has a significant effect on national economic growth. The analysis of published census/biannual surveys of construction by the Department of Statistics of Malaysia shows that Malaysia managed to achieve construction labour productivity growth between 1996 and 2005 despite increases in cost per employee. The decrease in unit labour costs is attributed to the value added improvement per worker through the increase in capital intensity. The marginal decline in capital productivity is due to the gestation period and the overcapacity of the industry. The civil engineering sub-sector recorded the highest labour productivity and is the most labour competitive in terms of unit labour cost and added value per labour cost. The residential sub-sectors recorded greatest change in the productivity indicators between 1996 and 2005.

International comparisons of Malaysian construction labour productivity

Productivity is basic statistical information for many international comparisons and country performance assessments. This study estimates the construction labour productivity of 79 selected economies. The real (purchasing power parities converted) and nominal construction expenditure from the Report of 2005 International Comparison Programme published by the World Bank and construction employment from the database of labour statistics (LABORSTA) operated by the Bureau of Statistics of International Labour Organization were used in the estimation. The inference statistics indicate that the descending order of nominal construction labour productivity from high income economies to low income economies is not established. The average construction labour productivity of low income economies is higher than middle income economies when the productivity calculation uses purchasing power parities converted data. Malaysia ranked 50th and 63rd position among the 79 selected economies on real and nominal measurement respectively.

The management of transport construction projects : a survey of public sector organisations in Queensland Australia

Construction procurement organisations in the Australian framework provide broad guidelines on project management in setting benchmark performance measurements and processes for evaluating their projects. Despite this, little has been known in the project management practise in transport construction projects in Australia, in particular Queensland. Questionnaire data from 53 project management practitioners employed in State and City public sector organisations in Queensland,suggested that many practitioners in the public sector have little or a lack of understanding of government regulatory policies, which are used as economic evaluation tools for project options. Public sector project managers perceive socio-economic evaluation tools as inappropriate for public sector projects. The survey results also found conducting risk management analysis, developing a risk register and mitigation of risks were most effective way of managing risk. This study provides an opportunity for the public sector to review and provide training on project management practices and government regulatory policies governing public projects. This will improve project management practitioners’ understanding and interpretation of government regulatory policies.

Off-world robotic excavation for Large-scale habitat construction and resource extraction

This paper describes technologies we have developed to perform autonomous large-scale off-world excavation. A scale dragline excavator of size similar to that required for lunar excavation was made capable of autonomous control. Systems have been put in place to allow remote operation of the machine from anywhere in the world. Algorithms have been developed for complete autonomous digging and dumping of material taking into account machine and terrain constraints and regolith variability. Experimental results are presented showing the ability to autonomously excavate and move large amounts of regolith and accurately place it at a specified location.

Structural equation model of construction contract dispute potential

This paper presents the results of a structural equation model (SEM) for describing and quantifying the fundamental factors that affect contract disputes between owners and contractors in the construction industry. Through this example, the potential impact of SEM analysis in construction engineering and management research is illustrated. The purpose of the specific model developed in this research is to explain how and why contract related construction problems occur. This study builds upon earlier work, which developed a disputes potential index, and the likelihood of construction disputes was modeled using logistic regression. In this earlier study, questionnaires were completed on 159 construction projects, which measured both qualitative and quantitative aspects of contract disputes, management ability, financial planning, risk allocation, and project scope definition for both owners and contractors. The SEM approach offers several advantages over the previously employed logistic regression methodology. The final set of structural equations provides insight into the interaction of the variables that was not apparent in the original logistic regression modeling methodology.

Safety impacts of alcohol and other drugs in the construction industry : a research methodology

Anecdotal evidence from the infrastructure and building sectors highlights issues of drugs and alcohol and its association with safety risk on construction sites. Operating machinery and mobile equipment, proximity to live traffic together with congested sites, electrical equipment and operating at heights conspire to accentuate the potential adverse impact of drugs and alcohol in the workplace. While most Australian jurisdictions have identified this as a critical safety issue, information is limited regarding the prevalence of alcohol and other drugs in the workplace and there is limited evidential guidance regarding how to effectively and efficiently address such an issue. No known study has scientifically evaluated the relationship between the use of drugs and alcohol and safety impacts in construction, and there has been only limited adoption of nationally coordinated strategies, supported by employers and employees to render it socially unacceptable to arrive at a construction workplace with impaired judgement from drugs and alcohol. A nationally consistent collaborative approach across the construction workforce - involving employers and employees; clients; unions; contractors and sub-contractors is required to engender a cultural change in the construction workforce – in a similar manner to the on-going initiative in securing a cultural change to drink-driving in our society where peer intervention and support is encouraged. This study has four key objectives. Firstly, using the standard World Health Organisation AUDIT, a national qualitative and quantitative assessment of the use of drugs and alcohol will be carried out. This will build upon similar studies carried out in the Australian energy and mining sectors. Secondly, the development of an appropriate industry policy will adopt a non-punitive and rehabilitative approach developed in consultation with employers and employees across the infrastructure and building sectors, with the aim it be adopted nationally for adoption at the construction workplace. Thirdly, an industry-specific cultural change management program will be developed through a nationally collaborative approach to reducing the risk of impaired performance on construction sites and increasing workers’ commitment to drugs and alcohol safety. Finally, an implementation plan will be developed from data gathered from both managers and construction employees. Such an approach stands to benefit not only occupational health and safety, through a greater understanding of the safety impacts of alcohol and other drugs at work, but also alcohol and drug use as a wider community health issue. This paper will provide an overview of the background and significance of the study as well as outlining the proposed methodology that will be used to evaluate the safety impacts of alcohol and other drugs in the construction industry.

Safety impacts of alcohol and other drugs in the construction industry : Preliminary findings

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