Study of the road construction industry in Sri Lanka: emphasis on improving performance of the industry

Outcome of the research is to identify significant factors influencing the productivity and performance of the road construction industry in Sri Lanka and to compare the identified factors with the Australian construction industry. Also to recommend strategies to improve productivity and performance of the Sri Lankan Industry.

Energy productivity and total-factor productivity in the Australian construction industry

There is urgent need to consider energy consumption when measuring total-factor productivity in the construction industry. This paper adopts the Malmquist index method to investigate the factors affecting the energy productivity of the Australian construction industry and compares them with those decomposed from the total-factor productivity. An input-oriented distance function and a contemporaneous benchmark technology are employed to develop the data envelopment analysis models. The Malmquist productivity index is decomposed into the technological change, pure technical efficiency change and activity effect to gain comprehensive insights into changes of construction productivity in the Australian states and territories over the past two decades. Research results show that both energy productivity and total-factor productivity improved in Australia, particularly related to technological development. The pure technical efficiency and activity indices changed slightly over time or across regions. This study demonstrates that there exists a linkage between energy productivity and total-factor productivity through their technological and technical efficiency changes. The Australian construction industry could enhance these two productivities by introducing advanced technologies and implementing them efficiently.

Economic aspects of safety in the Greek construction industry

The thesis addresses the economic impacts of construction safety in Greece. The research involved the development of a methodology for determining the overall costs of safety, namely the sum of the costs of accidents and the costs of safety management failures (with or without accident) including image cost. Hitherto, very little work has been published on the cost of accidents in practical case studies. Moreover, to the author’s belief, no research has been published that seeks to determine in real cases the costs of prevention. The methodology developed is new, transparent, and capable of being replicated and adapted to other employment sectors and to other countries. The methodology was applied to three construction projects in Greece to test the safety costing methodology and to offer some preliminary evidence on the business case for safety. The survey work took place between 1999 and 2001 and involved 27 months of costing work on site. The study focuses on the overall costs of safety that apply to the main (principal) contractor. The methodology is supported by 120 discrete cost categories, and systematic criteria for determining which costs are included (counted) in the overall cost of safety. A quality system (in compliance with ISO9000 series) was developed to support the work and ensure accuracy of data gathering. The results of the study offer some support for the business case for safety. Though they offer good support for the economics of safety as they demonstrate need for cost effectiveness. Subject to important caveats, those projects that appeared to manage safety more cost-effectively achieved the lowest overall safety cost. Nevertheless, results are significantly lower than of other published works for two main reasons; first costs due to damages with no potential to injury were not included and second only costs to main constructor were considered. Study’s results are discussed and compared with other publish works.

Carbon productivity: a case study in the Australian construction industry

Climate change is a severe threat to human development. Environmental protection and economic growth are two significant dimensions of promoting sustainable global development. In this research, a two-step procedure has been applied to investigate carbon productivity, which is deemed an appropriate indicator to measure sustainable development in conjunction with carbon reduction and production advancement. A decomposition method with the Log Mean Divisia Index has been applied to explore the factors influencing carbon productivity change, including technological innovation and regional adjustment. The carbon productivity of the Australian construction industry from 1990 to 2012 was then investigated. Research results indicate that carbon productivity in Australian construction had increased significantly and could be further improved. Technological innovation has played an important role in promoting carbon productivity, while regional adjustment has remained roughly steady. Based on correlation analyses, scale of the construction market and stock of machinery and equipment had shown weak correlations with carbon productivity changes, and it was clear that improvement in carbon productivity could benefit capital productivity and investment return. The research has systematically defined carbon productivity and for the first time measured it for the construction industry. The results are expected to assist construction industries worldwide to investigate productivity performance and to identify the influencing factors for improving development sustainability.

Managing undesirable outputs in the Australian construction industry using Data Envelopment Analysis models

Carbon reduction has become one of the most significant challenges for economic growth. This paper presents the preliminary analysis of undesirable output reduction targets and emission schedules in temporal-spatial comparisons based on Data Envelopment Analysis. The reduction targets of undesirable outputs are investigated, including the maximum, input, technical and ideal reduction targets. Four Data Envelopment Analysis models that are based on a sequential benchmark technology and variable returns to scale are introduced to measure these reduction percentages. In order to formulate the optimal emission schedule of undesirable outputs, an optimal model is provided without inflation. Data from the Australian construction industry from 2000 to 2010 are employed to develop the models. The results of the analysis indicate that the Australian Government could achieve its promised carbon reduction targets in the construction industry. Most Australian regions' construction industries possess carbon mitigation potential and some of them could increase their desirable outputs if carbon were decreased. This paper suggests that policymakers can benefit from formulating various suitable undesirable output reduction objectives and schedules through the models developed. The research method can be replicated for other sectors and regions focussing on undesirable output reduction.

Profitability performance assessment in the Australian construction industry: a global relational two-stage DEA method

Effective performance measurement drives performance and supports the development of construction. Only minimal literature measuring construction performance, efficiency and effectiveness simultaneously can be identified. A global relational two-stage data envelopment analysis (DEA) method is here proposed in order to produce effective and informative performance results. A relational two-stage DEA method systematically measures overall efficiency for a whole construction system and also yields scores for the individual stages of construction. The DEA results can be directly compared through global benchmark technology. The Australian construction industry is employed in order to implement the new method, in which profitability performance as a vital indicator of business survival, and its two dimensions of efficiency and effectiveness, are measured. The construction profitability performance and efficiency measures obtained provide evidence of underperformance and a slight imbalance in Australia between 1991 and 2012, while the measures obtained for the effectiveness factor indicate better achievement. The approach here developed promotes progress in modelling two-stage performance measurement and it can be replicated worldwide by construction projects, organizations or industries in order to quantify their performance, identify internal inefficiency components and recognize competitive advantages for promoting sustainable development.

Input–output structures of the Australian construction industry

The Australian construction industry continues to play an important role in the national economy. Analysis using input–output tables makes it possible to understand the role of the construction industry in Australia’s economy and its relationships to other major industries over years. This study applies several economic indicators to investigate the construction industry’s contributions to gross national product and gross national income, as well as its backward and forward linkage indicators, and its output and input multipliers. The paper also investigates the purchases of goods and services by the construction industry from other sectors and its sales to other industries over the analysis period. Findings from this research may help policymakers to better understand the economic linkages between the construction industry and other major industries, and the structural changes in its inputs and outputs in relation to these others.

The use of supply chain management to reduce delays : Malaysian public sector construction projects

Construction delays are a critical problem for Malaysian public sector projects. These delays have been blamed mainly on inefficient traditional construction practices that continue to dominate the current industry. This paper reports the progress to date of a Ph.D. research project aimed at developing a framework to utilize Supply Chain Management (SCM) tools to improve the time performance of Malaysian Government projects. The potential of SCM has been identified for public sector governance and its use in Malaysia is now being considered within the strategy of the Malaysian Construction Industry Master Plan (2006-2015). Encouraged by success in the UK, there is a cautious optimism concerning the successful application of SCM in Malaysia. This paper considers delay as a problem in Malaysian public sector projects, establishes the need to embrace SCM and then elucidates the need and strategies for the development of a delay reduction framework. A literature review, survey mechanism and structured interview schedule will be undertaken to achieve the research objectives. The final research outcome will be a framework that addresses root delay contributors (“pathogens”) and applies SCM tools for their mitigation.

Investigating the role of ICT in improving productivity in construction supply chains in Australian construction industry.

The Australian construction industry is a fragmented and profoundly competitive industry with high levels of subcontracting resulting in complex supply chain formations. Traditional methods and forms of communication are being proven as inefficient and losing their charm while participants face heavy volumes of communications that often occurs on a daily basis between trading partners in a supply chain on projects. Information Communication Technologies (ICT), due to their robustness and the ability to quickly disseminate data/information, have the capacity to address highlighted communication issues in a structured and an efficient manner. Timesavings produced by these can be directly translated in terms of productivity gain. This paper presents perceptions of subcontractors working in the construction industry in Melbourne Australia on the use of ICT obtained through an exploratory study.

The identification of Malaysian contractor satisfaction dimensions : a strategy for continuous improvement

The unique characteristics of the construction industry - such as the fragmentation of its processes, varied scope of works and diversity of its participants - are contributory factors to poor project performance. Several issues are unresolved due to the lack of a comprehensive technique to measure project outcomes including: inefficient decision making, insufficient communication, uncertain site conditions, a continuously changing environment, inharmonious working relationships, mismatched objectives within the project team and a blame culture. One approach to overcoming these problems appears to be to measure performance by gauging contractor satisfaction (Co-S) levels, but this has not been widely investigated as yet. Additionally, the key Co-S dimensions at the project level are still not fully identified. ----- ----- This paper concerns a study of satisfaction dimensions, primarily by a postal questionnaire survey of construction contractors registered by the Malaysian Construction Industry Development Board (CIDB). Eight satisfaction dimensions are identified that are significantly and substantially relate to these contractors - comprising: project cost performance, schedule performance, product performance, design satisfaction, site safety, project profitability, business performance and relationships between participants. -Each of these dimensions is accorded different priority levels of satisfaction by different contractors. ----- ----- The output of this study will be useful in raising the awareness and understanding of project teams regarding contractors’ needs, mutual objectives and open communication to help to deliver a successful project.

Strategic management practices in the construction industry : a study of Indonesian enterprises

Since the establishment of the first national strategic development plan in the early 1970s, the construction industry has played an important role in terms of the economic, social and cultural development of Indonesia. The industry’s contribution to Indonesia’s gross domestic product (GDP) increased from 3.9% in 1973 to 7.7% in 2007. Business Monitoring International (2009) forecasts that Indonesia is home to one of the fastest-growing construction industries in Asia despite the average construction growth rate being expected to remain under 10% over the period 2006 – 2010. Similarly, Howlett and Powell (2006) place Indonesia as one of the 20 largest construction markets in 2010. Although the prospects for the Indonesian construction industry are now very promising, many local construction firms still face serious difficulties, such as poor performance and low competitiveness. There are two main reasons behind this problem: the environment that they face is not favourable; the other is the lack of strategic direction to improve competitiveness and performance. Furthermore, although strategic management has now become more widely used by many large construction firms in developed countries, practical examples and empirical studies related to the Indonesian construction industry remain scarce. In addition, research endeavours related to these topics in developing countries appear to be limited. This has potentially become one of the factors hampering efforts to guide Indonesian construction enterprises. This research aims to construct a conceptual model to enable Indonesian construction enterprises to develop a sound long-term corporate strategy that generates competitive advantage and superior performance. The conceptual model seeks to address the main prescription of a dynamic capabilities framework (Teece, Pisano & Shuen, 1997; Teece, 2007) within the context of the Indonesian construction industry. It is hypothesised that in a rapidly changing and varied environment, competitive success arises from the continuous development and reconfiguration of firm’s specific assets achieving competitive advantage is not only dependent on the exploitation of specific assets/capabilities, but on the exploitation of all of the assets and capabilities combinations in the dynamic capabilities framework. Thus, the model is refined through sequential statistical regression analyses of survey results with a sample size of 120 valid responses. The results of this study provide empirical evidence in support of the notion that a competitive advantage is achieved via the implementation of a dynamic capability framework as an important way for a construction enterprise to improve its organisational performance. The characteristics of asset-capability combinations were found to be significant determinants of the competitive advantage of the Indonesian construction enterprises, and that such advantage sequentially contributes to organisational performance. If a dynamic capabilities framework can work in the context of Indonesia, it suggests that the framework has potential applicability in other emerging and developing countries. This study also demonstrates the importance of the multi-stage nature of the model which provides a rich understanding of the dynamic process by which asset-capability should be exploited in combination by the construction firms operating in varying levels of hostility. Such findings are believed to be useful to both academics and practitioners, however, as this research represents a dynamic capabilities framework at the enterprise level, future studies should continue to explore and examine the framework in other levels of strategic management in construction as well as in other countries where different cultures or similar conditions prevails.

Strategic Management Practices in the Construction Industry : a Dynamic Capabilities View

This book is an empirical study of strategic management practices in the construction industry. It examines the dynamic capabilities paradigm within the context of the Indonesian construction industry. The characteristics of asset-capability combinations were found to be significant determinants of the competitive advantage of the Indonesian construction enterprises, and that such advantage sequentially contributes to organizational performance. In doing so, this study fills an important gap in the empirical literature and reinforces the dynamic capabilities framework’s recognition as a rigorous theory of strategic management. As the dynamic capabilities framework can work in the context of Indonesia, it suggests that the framework has potential applicability in other emerging and developing countries