Understanding absorptive capacity in Malaysian small and medium sized (SME) construction companies

Purpose – The construction industry is a very important part of the Malaysian economy. The government's aim is to make the industry more productive, efficient and safe. Small to medium-sized enterprises (SMEs) are at the core of the Malaysian construction industry and account for about 90 per cent of companies undertaking construction work. One of the main challenges faced by the Malaysian construction industry is the ability to absorb new knowledge and technology and to implement it in the construction phase. The purpose of this paper is to consider absorptive capacity in Malaysian construction SMEs in rural areas. Design/methodology/approach – The research was conducted in three stages: first, understanding the Malaysian construction industry; second, a literature review on the issues related to absorptive capacity and discussions with the Construction Industry Development Board (CIDB); and third, multiple case studies in five construction SMEs operating in a rural area to validate the factors influencing absorptive capacity. Findings – Nine key factors were identified influencing absorptive capacity in Malaysian construction SMEs operating in rural areas. These factors involved: cost and affordability; availability and supply; demand; infrastructure; policies and regulations; labour readiness; workforce attitude and motivation; communication and sources of new knowledge and; culture. Originality/value – The key factors influencing absorptive capacity presented in this paper are based on validation from the case studies in five construction SMEs in Malaysia. The research focuses on how they operate in rural areas; however, the research results have wider application than just Malaysia. The key factors identified as influencing absorptive capacity can serve as a basis for considering knowledge absorption in the wider context by SMEs in other developing countries.

Local development companies and the regeneration of Britain's cities

Efforts to decentralise the pursuit of economic and social development have increased in recent years. The authors examine the rationale for establishing local development companies in areas of high unemployment and deprivation. The broad purpose is to establish a new style of organisation that combines attributes of the public and private sectors-to adapt and integrate economic and social services to meet local needs, to champion local interests in external arenas, and to act as enabling agents to promote local investment and development. These arguments are elaborated and illustrated with reference to one of Britain's most successful local development companies, Govan Initiative. The analysis reveals important strengths of the Initiative, including its action orientation, commitment to quality, and a local leadership role, but also certain weaknesses including its limited leverage over wider policies and resource flows. Local development companies need meaningful commitment from regional and national public organisations to fulfil their potential.

A review of growth for construction service companies in global markets

Throughout the developed world, professional services play an increasingly important part in an economy, with many countries showing a substantial positive trade balance for services. Yet, there has been relatively little research on construction services (CS) and, in particular, how well professional service companies (PSFs) perform in the international arena. The method for collecting services export information differs to the way in which goods and products exports data are gathered because of the intangible nature of services. Organisational growth of companies aims to share risks across different regions and sectors, however, the rapidly changing business environment challenges companies with the increasing foreign ownership and changes in procurement. The complexity of today’s international construction services organisations raises two questions: how the organisations can successfully manage growth and what are their motives for international trade. The research focuses on top UK consulting engineering companies to understand their organisational strategy, their export strategy, and drivers for overseas activities. The data will feed a model of professional services exports, which can help to inform the way services export data could be collected to better reflect the industry’s performance.

Do construction companies need to match employees' expectations?

Commitment of employees is relatively low in construction. This problem is exasperated by companies inability to attract, motivate, and retain talent that is then often channelled into other more attractive industrial sectors where the prospects, conditions and rewards are perceived to be much higher. The purpose of this study is thus primarily to develop a generic model to maximise employees' engagement, improve their motivation and increase the retention levels. To achieve this aim, the investigation looks into how perceived employment obligations and expectations impact commitment and through that organisational performance. The study is based on the postulations of Luhmann's theory of social systems with communication viewed as a constitutive element of a social system. Consequently expectations of a particular party in an employment relationship are represented in a communicative space requiring the other party's understanding in order to align expectations of both sides in the relationship. Explicitly, alignment of by an employee perceived manager's expectations determines his/ her commitment to fulfil obligations towards the manager. The result of this first stage of research is a conceptual model developed following the substantial supporting evidence in the literature and it forms the framework for mitigation of low commitment, motivation and retention of employees. The model particularly focuses on factors affecting employees' perceived expectations like reneging, incongruence and the process of communication. In the future the model will be validated using empirical data from a combination of observational and enquiry-based research. Once completed, the model will provide a framework for informing Human Resource Management policies with the aim to improve commitment of employees, increase the levels of retention and consequently improve the performance of construction organisations.

Developing an engaging virtual action learning programme for SME managers – A UK perspective

In this paper we present results from an EU-funded project with the aim of examining the adaptation of e-learning to meet the needs of managers in different contexts. A set of design considerations is elucidated. These principles were derived from an analysis of five completed projects. This was followed by focus group discussion in the UK to test the principles derived.. These focus group were planned so as to gain greater clarity in the design of e-learning programmes aimed at UK-based SME leaders and managers. This paper starts by looking at the importance of SME management development for the economic wellbeing of the community and goes on to review research into issues in engaging managers in development activities. The results of a review of an earlier experimental programme (ESeN) are presented as it formed part of the process which led to the identification of theoretical design principles then tested in the focus groups. Finally, recommendations are presented for SME e-learning providers as well as areas for further research.