Construction Prices : the Market Effect

Teachers of construction economics and estimating have for a long time recognised that there is more to construction pricing than detailed calculation of costs (to the contractor). We always get to the point where we have to say "of course, experience or familiarity of the market is very important and this needs judgement, intuition, etc". Quite how important is the matter in construction pricing is not known and we tend to trivialise its effect. If judgement of the market has a minimal effect, little harm would be done, but if it is really important then some quite serious consequences arise which go well beyond the teaching environment. Major areas of concern for the quantity surveyor are in cost modelling and cost planning - neither of which pay any significant attention to the market effect. There are currently two schools of thought about the market effect issue. The first school is prepared to ignore possible effects until more is known. This may be called the pragmatic school. The second school exists solely to criticise the first school. We will call this the antagonistic school. Neither the pragmatic nor the antagonistic schools seem to be particularly keen to resolve the issue one way or the other. The founder and leader of the antagonistic school is Brian Fine whose paper in 1974 is still the basic text on the subject, and in which he coined the term 'socially acceptable' price to describe what we now recognise as the market effect. Mr Fine's argument was then, and is since, that the uncertainty surrounding the contractors' costing and cost estimating process is such that the uncertainty surrounding the contractors' cost that it logically leads to a market-orientated pricing approach. Very little factual evidence, however, seems to be available to support these arguments in any conclusive manner. A further, and more important point for the pragmatic school, is that, even if the market effect is as important as Mr Fine believes, there are no indications of how it can be measured, evaluated or predicted. Since 1974 evidence has been accumulating which tends to reinforce the antagonists' view. A review of the literature covering both contractors' and designers' estimates found many references to the use of value judgements in construction pricing (Ashworth & Skitmore, 1985), which supports the antagonistic view in implying the existence of uncertainty overload. The most convincing evidence emerged quite by accident in some research we recently completed with practicing quantity surveyors in estimating accuracy (Skitmore, 1985). In addition to demonstrating that individual quantity surveyors and certain types of buildings had significant effect on estimating accuracy, one surprise result was that only a very small amount of information was used by the most expert surveyors for relatively very accurate estimates. Only the type and size of building, it seemed, was really relevant in determining accuracy. More detailed information about the buildings' specification, and even a sight to the drawings, did not significantly improve their accuracy level. This seemed to offer clear evidence that the constructional aspects of the project were largely irrelevant and that the expert surveyors were somehow tuning in to the market price of the building. The obvious next step is to feed our expert surveyors with more relevant 'market' information in order to assess its effect. The problem with this is that our experts do not seem able to verbalise their requirements in this respect - a common occurrence in research of this nature. The lack of research into the nature of market effects on prices also means the literature provides little of benefit. Hence the need for this study. It was felt that a clearer picture of the nature of construction markets would be obtained in an environment where free enterprise was a truly ideological force. For this reason, the United States of America was chosen for the next stage of our investigations. Several people were interviewed in an informal and unstructured manner to elicit their views on the action of market forces on construction prices. Although a small number of people were involved, they were thought to be reasonably representative of knowledge in construction pricing. They were also very well able to articulate their views. Our initial reaction to the interviews was that our USA subjects held very close views to those held in the UK. However, detailed analysis revealed the existence of remarkably clear and consistent insights that would not have been obtained in the UK. Further evidence was also obtained from literature relating to the subject and some of the interviewees very kindly expanded on their views in later postal correspondence. We have now analysed all the evidence received and, although a great deal is of an anecdotal nature, we feel that our findings enable at least the basic nature of the subject to be understood and that the factors and their interrelationships can now be examined more formally in relation to construction price levels. I must express my gratitude to the Royal Institution of Chartered Surveyors' Educational Trust and the University of Salford's Department of Civil Engineering for collectively funding this study. My sincere thanks also go to our American participants who freely gave their time and valuable knowledge to us in our enquiries. Finally, I must record my thanks to Tim and Anne for their remarkable ability to produce an intelligible typescript from my unintelligible writing.

Factors affecting marketing decision making with an ethical content : collusive tendering in the construction contract market

Reports of immoral marketing practices i n the construction industry attract political, media and public but not much academic interest. This paper adopts a behavioural perspective and proposes a model for applying marketing ethics concepts and methods in the study of collusion in the construction contract market. An extensive multidisciplinary review of existing literature identified a lack of adequate conceptualisation of the mechanisms and decision making factors of collusive tendering. The process of developing the model is detailed in this paper. The objectives and methodology of the research project that tested the model are also outlined. The paper concludes with a brief note on the contributions and application of the proposed model.

Human factors in estimating

It is commonly held that the ability of the estimator to apply professional skill and judgement is an important factor in the production of an accurate cost estimate. This chapter identifies these abilities and attributes of the individual estimator that affects estimating accuracy. These human factors are examined under the headings of the role of the estimators, skills of the estimator, characteristics of the estimator, interpretation of data, and the influence of expertise.

Which procurement system? Towards a universal procurement selection technique

Two approaches are described, which aid the selection of the most appropriate procurement arrangements for a building project. The first is a multi-attribute technique based on the National Economic Development Office procurement path decision chart. A small study is described in which the utility factors involved were weighted by averaging the scores of five 'experts' for three hypothetical building projects. A concordance analysis is used to provide some evidence of any abnormal data sources. When applied to the study data, one of the experts was seen to be atypical. The second approach is by means of discriminant analysis. This was found to provide reasonably consistent predictions through three discriminant functions. The analysis also showed the quality criteria to have no significant impact on the decision process. Both approaches provided identical and intuitively correct answers in the study described. Some concluding remarks are made on the potential of discriminant analysis for future research and development in procurement selection techniques.

Conflict and communication among engineers

The trend of cultural diversity is increasing in all organizations, especially engineering ones, due to globalization, mergers, joint ventures and the movement of the workforce. The collaborative nature of projects in engineering industries requires long-term teamwork between local and international engineers. Research confirms a specific culture among engineering companies that isassumed to have a negative effect on collaboration and communication among co-workers. Multicultural workplaces have been reported as challenging environments in the engineering work culture, which calls for more research among engineering organizations. An everyday challenge for co-workers, especially in culturally diverse contexts, is handling interpersonal conflict. This perceived conflict among individuals can happen because of actual differences in tasks or relationships. Research demonstrates that task conflict at the group level has some positive effects on decision-making and innovation, while it has negative effects on employees’ work attitude and performance. However, relationship conflict at the individual level has only negative effects including frustration, tension, low job satisfaction, high employee turnover and low productivity. Outcomes of both task and relationship conflict at individual level can have long-term negative consequences like damaged organizational commitment. One of the most important sources of differences between individuals, which results in conflict, is their cultural backgrounds. First, this thesis suggests that in culturally diverse workplaces, people perceive more relationship conflict than task conflict. Second, this thesis examines interpersonal communication in culturally diverse work places. Communicating effectively in culturally diverse workplaces is crucial for today’s business. Culture has a large effect on the ways that people communicate with each other. Ineffective communication can escalate interpersonal conflict and cause frustration in the long term. Communication satisfaction, defined as enjoying the communication and feeling that the communication was appropriate and effective, has a positive effect on individuals’ psychological wellbeing. In a culturally diverse workplace, it is assumed that individuals feel less satisfied with their interpersonal communications because of their lack of knowledge about other cultures’ communication norms. To manage interpersonal interactions, many authors suggest that individuals need a specific capability, i.e., cultural intelligence (some studies use cultural competence, global intelligence or intercultural competence interchangeably). Some authors argue that cultures are synergic and convergent and the postmodernist definition of culture is just our dominant beliefs. However, other authors suggest that cultural intelligence is the strongest and most comprehensive competency for managing cross-cultural interactions, because various cultures differ so greatly at the micro level. This thesis argues that individuals with a high level of cultural intelligence perceive less interpersonal conflict and more satisfaction with their interpersonal communication. Third, this thesis also looks at individuals' perception of cultural diversity. It is suggested that level of cultural diversity plays a moderating role on all of the proposed relationships (effect of cultural intelligence on perception of relationship conflict/ communication satisfaction) This thesis examines the relationship among cultural diversity, cultural intelligence, interpersonal conflict and communication by surveying eleven companies in the oil and gas industry. The multicultural nature of companies within the oil and gas industry and the characteristics of engineering culture call for more in-depth research on interpersonal interactions. A total of 286 invitation emails were sent and 118 respondents replied to the survey, giving a 41.26 per cent response rate. All the respondents were engineers, engineering managers or practical technicians. The average age of the participants was 36.93 years and 58.82 per cent were male. Overall, 47.6 per cent of the respondents had at least a master’s degree. Totally, 42.85 per cent of the respondents were working in a country that was not their country of birth. The overall findings reveal that cultural diversity and cultural intelligence significantly influence interpersonal conflict and communication satisfaction. Further, this thesis also finds that cultural intelligence is an effective competency for dealing with the perception of interpersonal relationship conflict and communication satisfaction when the level of cultural diversity is moderate to high. This thesis suggests that cultural intelligence training is necessary to increase the level of this competency among employees in order to help them to have better understanding of other cultures. Human resource management can design these training courses with consideration for the level of cultural diversity within the organization.

Interocular corneal symmetry in refractive error groups

Purpose: To examine between eye differences in corneal higher order aberrations and topographical characteristics in a range of refractive error groups. Methods: One hundred and seventy subjects were recruited including; 50 emmetropic isometropes, 48 myopic isometropes (spherical equivalent anisometropia ≤ 0.75 D), 50 myopic anisometropes (spherical equivalent anisometropia ≥ 1.00 D) and 22 keratoconics. The corneal topography of each eye was captured using the E300 videokeratoscope (Medmont, Victoria, Australia) and analyzed using custom written software. All left eye data were rotated about the vertical midline to account for enantiomorphism. Corneal height data were used to calculate the corneal wavefront error using a ray tracing procedure and fit with Zernike polynomials (up to and including the eighth radial order). The wavefront was centred on the line of sight by using the pupil offset value from the pupil detection function in the videokeratoscope. Refractive power maps were analysed to assess corneal sphero-cylindrical power vectors. Differences between the more myopic (or more advanced eye for keratoconics) and the less myopic (advanced) eye were examined. Results: Over a 6 mm diameter, the cornea of the more myopic eye was significantly steeper (refractive power vector M) compared to the fellow eye in both anisometropes (0.10 ± 0.27 D steeper, p = 0.01) and keratoconics (2.54 ± 2.32 D steeper, p < 0.001) while no significant interocular difference was observed for isometropic emmetropes (-0.03 ± 0.32 D) or isometropic myopes (0.02 ± 0.30 D) (both p > 0.05). In keratoconic eyes, the between eye difference in corneal refractive power was greatest inferiorly (associated with cone location). Similarly, in myopic anisometropes, the more myopic eye displayed a central region of significant inferior corneal steepening (0.15 ± 0.42 D steeper) relative to the fellow eye (p = 0.01). Significant interocular differences in higher order aberrations were only observed in the keratoconic group for; vertical trefoil C(3,-3), horizontal coma C(3,1) secondary astigmatism along 45 C(4, -2) (p < 0.05) and vertical coma C(3,-1) (p < 0.001). The interocular difference in vertical pupil decentration (relative to the corneal vertex normal) increased with between eye asymmetry in refraction (isometropia 0.00 ± 0.09, anisometropia 0.03 ± 0.15 and keratoconus 0.08 ± 0.16 mm) as did the interocular difference in corneal vertical coma C (3,-1) (isometropia -0.006 ± 0.142, anisometropia -0.037 ± 0.195 and keratoconus -1.243 ± 0.936 μm) but only reached statistical significance for pair-wise comparisons between the isometropic and keratoconic groups. Conclusions: There is a high degree of corneal symmetry between the fellow eyes of myopic and emmetropic isometropes. Interocular differences in corneal topography and higher order aberrations are more apparent in myopic anisometropes and keratoconics due to regional (primarily inferior) differences in topography and between eye differences in vertical pupil decentration relative to the corneal vertex normal. Interocular asymmetries in corneal optics appear to be associated with anisometropic refractive development.

The ECOS Project. An interactive simulation to promote an ECO-friendly universe.

Custom designed for display on the Cube Installation situated in the new Science and Engineering Centre (SEC) at QUT, the ECOS project is a playful interface that uses real-time weather data to simulate how a five-star energy building operates in climates all over the world. In collaboration with the SEC building managers, the ECOS Project incorporates energy consumption and generation data of the building into an interactive simulation, which is both engaging to users and highly informative, and which invites play and reflection on the roles of green buildings. ECOS focuses on the principle that humans can have both a positive and negative impact on ecosystems with both local and global consequence. The ECOS project draws on the practice of Eco-Visualisation, a term used to encapsulate the important merging of environmental data visualization with the philosophy of sustainability. Holmes (2007) uses the term Eco-Visualisation (EV) to refer to data visualisations that ‘display the real time consumption statistics of key environmental resources for the goal of promoting ecological literacy’. EVs are commonly artifacts of interaction design, information design, interface design and industrial design, but are informed by various intellectual disciplines that have shared interests in sustainability. As a result of surveying a number of projects, Pierce, Odom and Blevis (2008) outline strategies for designing and evaluating effective EVs, including ‘connecting behavior to material impacts of consumption, encouraging playful engagement and exploration with energy, raising public awareness and facilitating discussion, and stimulating critical reflection.’ Consequently, Froehlich (2010) and his colleagues also use the term ‘Eco-feedback technology’ to describe the same field. ‘Green IT’ is another variation which Tomlinson (2010) describes as a ‘field at the juncture of two trends… the growing concern over environmental issues’ and ‘the use of digital tools and techniques for manipulating information.’ The ECOS Project team is guided by these principles, but more importantly, propose an example for how these principles may be achieved. The ECOS Project presents a simplified interface to the very complex domain of thermodynamic and climate modeling. From a mathematical perspective, the simulation can be divided into two models, which interact and compete for balance – the comfort of ECOS’ virtual denizens and the ecological and environmental health of the virtual world. The comfort model is based on the study of psychometrics, and specifically those relating to human comfort. This provides baseline micro-climatic values for what constitutes a comfortable working environment within the QUT SEC buildings. The difference between the ambient outside temperature (as determined by polling the Google Weather API for live weather data) and the internal thermostat of the building (as set by the user) allows us to estimate the energy required to either heat or cool the building. Once the energy requirements can be ascertained, this is then balanced with the ability of the building to produce enough power from green energy sources (solar, wind and gas) to cover its energy requirements. Calculating the relative amount of energy produced by wind and solar can be done by, in the case of solar for example, considering the size of panel and the amount of solar radiation it is receiving at any given time, which in turn can be estimated based on the temperature and conditions returned by the live weather API. Some of these variables can be altered by the user, allowing them to attempt to optimize the health of the building. The variables that can be changed are the budget allocated to green energy sources such as the Solar Panels, Wind Generator and the Air conditioning to control the internal building temperature. These variables influence the energy input and output variables, modeled on the real energy usage statistics drawn from the SEC data provided by the building managers.

Heritage & habitus : designing to support situated, living knowledge

We refer to an ongoing endeavour aimed to assist Indigenouscommunities in Australian in persisting their personal and cultural memories linked to temporally dynamic interactions in situ. The design enables Indigenous users to upload items they collect themselves (e.g. photographs, audio, video) using mobile phones,in their traditional lands into a topographical simulation; and, thento associate these items with their own hand-drawn markings inthe simulation. The design responds to the rich interconnectedness between Indigenous culture and the land and the need to converge spatial information technologies with practices that are not, inherently, conditioned by the geometries of the West. We propose that the design approach contributes to thinking about ways that mobile guides can respond to multiple realities and corporeal and affective phenomena.

Choroidal thickness in myopic and non-myopic children assessed with enhanced depth imaging optical coherence tomography

Purpose To examine choroidal thickness (ChT) and its topographical variation across the posterior pole in myopic and non-myopic children. Methods One hundred and four children aged 10-15 years of age (mean age 13.1 ± 1.4 years) had ChT measured using enhanced depth imaging optical coherence tomography (OCT). Forty one children were myopic (mean spherical equivalent -2.4 ± 1.5 D) and 63 non-myopic (mean +0.3 ± 0.3 D). Two series of 6 radial OCT line scans centred on the fovea were assessed for each child. Subfoveal ChT and ChT across a series of parafoveal zones over the central 6mm of the posterior pole were determined through manual image segmentation. Results Subfoveal ChT was significantly thinner in myopes (mean 303 ± 79 µm) compared to non-myopes (mean 359 ± 77 µm) (p<0.0001). Multiple regression analysis revealed both refractive error (r = 0.39, p<0.001) and age (r = 0.21, p = 0.02) were positively associated with subfoveal ChT. ChT also exhibited significant topographical variations, with the choroid being thicker in more central regions. The thinnest choroid was typically observed in nasal (mean 286 ± 77 µm) and inferior-nasal (306 ± 79 µm) locations, and the thickest in superior (346 ± 79 µm) and superior-temporal (341 ± 74 µm) locations. The difference in ChT between myopic and non-myopic children was significantly greater in central foveal regions compared to more peripheral regions (>3 mm diameter) (p<0.001). Conclusions Myopic children have significantly thinner choroids compared to non-myopic children of similar age, particularly in central foveal regions. The magnitude of difference in choroidal thickness associated with myopia appears greater than would be predicted by a simple passive choroidal thinning with axial elongation.