Economic fluctuations and productivity in the Malaysian construction sector

Growth in productivity is the key determinant of the long-term health and prosperity of an economy. The construction industry being one of major strategic importance, its productivity performance has a significant effect on national economic growth. The relationship between construction output and economy has received intensive studies, but there is lack of empirical study on the relationship between construction productivity and economic fluctuations. Fluctuations in construction output are endemic in the industry. In part they are caused by the boom and slump of the economy as a whole and in part by the nature of the construction product. This research aims to uncover how the productivity of construction sector is influenced in the course of economic fluctuations in Malaysia. Malaysia has adopted three economic policies – New Economic Policy (1971-1990), National Development Policy (1991-2000) and the National Vision Policy (2001-2010) since gaining independence in 1959. The Privatisation Master Plan was introduced in 1991. Operating within this historical context, the Malaysian construction sector has experienced four business cycles since 1960. A mixed-method design approach is adopted in this study. Quantitative analysis was conducted on the published official statistics of the construction industry and the overall economy in Malaysia between 1970 and 2009. Qualitative study involved interviews with a purposive sample of 21 industrial participants. This study identified a 32-year long building cycle appears in 1975-2006. It is superimposed with three shorter construction business cycles in 1975-1987, 1987-1999 and 1999-2006. The correlations of Construction labour productivity (CLP) and GDP per capita are statistically significant for the 1975-2006 building cycle, 1987-1999 and 1999-2006 construction business cycles. It was not significant in 1975-1987 construction business cycles. The Construction Industry Surveys/Census over the period from 1996 to 2007 show that the average growth rate of total output per employee expanded but the added value per employee contracted which imply high cost of bought-in materials and services and inefficient usage of purchases. The construction labour productivity is peaked at 2004 although there is contraction of construction sector in 2004. The residential subsector performed relatively better than the other sub-sectors in most of the productivity indicators. Improvements are found in output per employee, value added per employee, labour competitiveness and capital investment but declines are recorded in value added content and capital productivity. The civil engineering construction is most productive in the labour productivity nevertheless relatively poorer in the capital productivity. The labour cost is more competitive in the larger size establishment. The added value per labour cost is higher in larger sized establishment attributed to efficient in utilization of capital. The interview with the industrial participant reveals that the productivity of the construction sector is influenced by the economic environment, the construction methods, contract arrangement, payment chain and regulatory policies. The fluctuations of construction demand have caused companies switched to defensive strategy during the economic downturn and to ensure short-term survival than to make a profit for the long-term survival and growth. It leads the company to take drastic measures to curb expenses, downsizing, employ contract employment, diversification and venture overseas market. There is no empirical evidence supports downsizing as a necessary step in a process of reviving productivity. The productivity does not correlate with size of firm. A relatively smaller and focused firm is more productive than the larger and diversified organisation. However diversified company experienced less fluctuation in both labour and capital productivity. In order to improve the productivity of the construction sector, it is necessary to remove the negatives and flaws from past practices. The recommended measures include long-term strategic planning and coordinated approaches of government agencies in planning of infrastructure development and to provide regulatory environments which encourage competition and facilitate productivity improvement.

An investigation of market segmentation theory and its impact on effective fundraising

This paper presents the findings of an indepth study into the effects and success of marketing segmentation, target marketing and fundraising. Organisations are constantly seeking new ways and more efficient means to raise funds so that they can fulfill their objectives. These organisations review and evaluate their resources to gain competitive advantage and increased fundraising success...

Costco and the Aussie shopper : a case study of the market entry of an international retailer

Retailing is a globalized industry yet retailers must respond to local shopping habits if they are to be perceived as legitimate by the host country customers. However, some retailers may be unable or unwilling to respond to all customer requirements. Costco, the membership warehouse club retailer, has been successful in its international expansion efforts, establishing its first Australian store in Melbourne in 2009. In the first twelve months of operation, the store became one of Costco’s top five stores in the world. We investigate this success focussing on the customer, and use institutional theory to analyze what concessions were made by the customer and the company. Data were collected from consumer interviews, site visits and secondary media and industry sources. Analysis revealed negotiations based on the rejection, acceptance or adaptation of the regulative, normative and cultural cognitive aspects of the Australian shopper and the Costco business model. Customers made concessions to accommodate the new business model, and Costco responded to entrenched Australian shopping habits. This case is the first to explore the outcome of retail internationalization from the customers’ perspective, revealing the concept of mutual concessions. The interaction and subsequent adaptation by both customer and retailer have resulted in the institutionalization of new shopping norms in the host country and success for the international retailer.

Productivity, technical and efficiency change in Singapore’s services sector, 2005 to 2008

The current study was motivated by statements made by the Economic Strategies Committee that Singapore’s recent productivity levels in services were well below countries such as the US, Japan and Hong Kong. Massive employment of foreign workers was cited as the reason for poor productivity levels. To shed more light on Singapore’s falling productivity, a nonparametric Malmquist productivity index was employed which provides measures of productivity change, technical change and efficiency change. The findings reveal that growth in Total Factor Productivity (TFP) was attributed to technical change with no improvement in efficiency change. Such results suggest that gains from TFP were input-driven rather than from a ‘best-practice’ approach such as improvements in operations or better resource allocation.

Alleviating poverty by engaging in microenterprise : how can INGOs in Vietnam help microenterprises overcome market constraints?

Microenterprise programs (MEPs) that aim to help poor communities engage in micro businesses have contributed significantly to poverty reduction in developing countries. However, a review of the literature suggests that the current approach adopted by MEPs has mainly provided services to microenterprises (MEs) based on what MEPs can supply rather than on what MEs actually need and what the market demands. Therefore, MEPs’ approaches are more likely to be supply driven. Yet when there are market constraints, such as high competition or low demand, this approach has been linked to the failure of MEs in their infancy. The alternative is a demand driven approach, in which MEPs provide MEs with support based on what MEs need, and what markets demand. However, research examining the application of this approach is limited. In order to gain an understanding of the approaches of MEPs, to identify whether these approaches are demand or supply driven, and to discover how these approaches are used to help MEs operate under market constraints, this study examined the operation of International Non-Government Organisations (INGOs) operating in Vietnam. This exploratory study involved in-depth interviews with senior executives from 10 INGOs. Thematic analysis was used to analyse data collected from the in-depth interviews. The results were further verified with publicly available data from the INGOs. The findings of this research indicate that the demand driven approach is dominant in most approaches of INGOs in Vietnam, and has become a key approach in helping MEs deal with market constraints. Further, rather than explaining the demand and supply driven dichotomy, the findings highlight that MEPs’ approaches can be viewed in two dimensions: a participant-demand driven approach focusing on the basic needs and capabilities of the extremely poor, irrespective of market demands; and a market-demand driven approach focusing on the capabilities of poor communities, while also accommodating market demands. This research provides contemporary and practical insights into the DD and SD approaches, and a better understanding of MEPs’ approaches to MED in Vietnam.

XBRL : the future of financial reporting and a catalyst for capital market development

There has never been a better time to strengthen financial reporting in Fiji. With increased interest shown by prospective companies in capital market participation, the pressing problems in the public sector reporting and accountability and global emphasis on the increasing need to strengthen the corporate governance structure, this is perhaps the opportune time to consider the potential of XBRL.

Development issues for the creative economy in Malaysia

Cultural tourism and creative industries have intersecting policy agendas and economic interdependencies. Most studies of the creative industries have focused on western countries. Cultural tourism is rarely included. However the arrival of the creative economy and its movement through developing countries has changed the relationship. Supporters of the creative economy now see fit to include tourism. This thesis addresses the development of the creative economy in Malaysia. The thesis conducted case studies on animation and museum sectors in Malaysia. These two case studies provide information on the development of creative economy in Malaysia. The study found that a top-down cultural management approach is being practised but that Malaysia is now influenced by new ideas concerning innovation and technical creativity. The study examined whether or not technical innovation by itself is enough. The reference points here are the Multimedia Super Corridor in Cyberjaya and other similar projects in the region. The museum case study was situated in Malacca. It showed that museums needed to adapt new media and new experiences to remain relevant in today’s world. In applying a case study approach, the thesis made use of interviews with key stakeholders, as well consulting numerous policy documents and web sites. Both case studies imitated similar products and services in the market but added local characteristics. This research project contributes significantly to the existing body of knowledge in the field of creative economy within the context of developing countries. Finally the thesis makes recommendations for Malaysia to better position itself in the regional economy while retaining its distinctive cultural identity.

Profit and organisational legitimacy in an emerging market

While there is common acknowledgement that the main aim of organisations is to maximise shareholder wealth, firms also have the obligation to manage the needs of a broader group of stakeholders as these firms are a product of social creation. In this study, we test the notion that the concept, profit, is fundamental to society’s perception of the firm in an emerging market, and the need for a firm to legitimise a level of profit. We evaluate the relationship between the readability of various components of corporate annual reports and the level of profit, and we also take into account the nature of disclosure (mandatory and non-mandatory), the size of the firm and the nature of setup (public enterprises and publicly listed companies). Our findings suggest that, as with developed markets, in emerging markets profit is indeed an important determinant of the nature of operations of a firm, and that firms consider readability of their disclosures in attempting to legitimise a level of profit.