Construction supply chain economic policy implementation for sectoral change : moving beyond the rhetoric

Construction sector policy makers have the opportunity to create improvements and develop economic, social and environmental sustainability through supply chain economics. The idea of the supply chain concept to improve firm behaviour and industry performance is not new. However there has been limited application and little or no measurement to monitor successful implementation. Often purchasing policies have been developed with sound strategic procurement principles but even these have had limited penetration in to the processes and practices of infrastructure agencies. The research reported in this paper documents an action research study currently being undertaken in the Australian construction sector which aims to explore supply chain economic policy implementation for sectoral change by two government agencies. The theory which informs this study is the emerging area of construction supply chain economics. There are five stages to the project including; demand analysis, chain analysis, government agency organizational audit, supplier strategy and strategic alignment. The overall objective is towards the development of a Supplier Group Strategy Map for two public sector agencies. Two construction subsectors are examined in detail; construction and demolition waste and precast concrete. Both of these subsectors are critical to the economic and environmental sustainability performance of the construction sector and the community as a whole in the particular jurisdictions. The local and state government agencies who are at the core of the case studies rely individually on the performance of these sectors. The study is set within the context of a sound state purchasing policy that has however, had limited application by the two agencies. Partial results of the study are presented and early findings indicate that the standard risk versus expenditure procurement model does not capture the complexities of project, owner and government risk considerations. A new model is proposed in this paper, which incorporates the added dimension of time. The research results have numerous stakeholders; they will hold particular value for those interested in regional construction sector economics, government agencies who develop and implement policy and who have a large construction purchasing imprint and the players involved in the two subsectors. Even though this is a study in Australia it has widespread applicability as previous research indicates that procurement reform is of international significance and policy implementation is problematic.

Framework for investment decision-making under risk and uncertainty for infrastructure asset management

A study has been conducted to investigate current practices on decision-making under risk and uncertainty for infrastructure project investments. It was found that many European countries such as the UK, France, Germany including Australia use scenarios for the investigation of the effects of risk and uncertainty of project investments. Different alternative scenarios are mostly considered during the engineering economic cost-benefit analysis stage. For instance, the World Bank requires an analysis of risks in all project appraisals. Risk in economic evaluation needs to be addressed by calculating sensitivity of the rate of return for a number of events. Risks and uncertainties of project developments arise from various sources of errors including data, model and forecasting errors. It was found that the most influential factors affecting risk and uncertainty resulted from forecasting errors. Data errors and model errors have trivial effects. It was argued by many analysts that scenarios do not forecast what will happen but scenarios indicate only what can happen from given alternatives. It was suggested that the probability distributions of end-products of the project appraisal, such as cost-benefit ratios that take forecasting errors into account, are feasible decision tools for economic evaluation. Political, social, environmental as well as economic and other related risk issues have been addressed and included in decision-making frameworks, such as in a multi-criteria decisionmaking framework. But no suggestion has been made on how to incorporate risk into the investment decision-making process.

Comparative study of guidelines and practices for building infrastructure asset management

This paper presents a comparative study of primarily Australian (and limited international) practices and guidelines on Buildings Asset Management (BAM). The objective of this study was to identify potential gaps in current practices and potential areas of research for further improvement. The paper starts with an overview of BAM. Later sections cover current BAM practices and guidelines across different states of Australia; give a limited overview of international practices and concludes with the authors’ observations.

The journey to delivered value in Australian procurement

In line with developments overseas Australian clients are turning to considerations of value in project procurement. Until the 1980s the industry operated in a largely traditional manner however the extremely adversarial behaviour exhibited during towards the end of the decade led to a number of significant events and initiatives including the publication of “No Dispute”, the Gyles Royal Commission into the Building Industry, the Construction Industry Development Agency (CIDA) and the work of the Australian Procurement and Construction Council (APCC). A number of research projects in progress in the CRC for Construction Innovation (CRC CI) are focussing on the assessment of value and methodologies to support the delivery of value in the procurement and management of engineering and construction projects. This paper charts the emergence of several key drivers in the process and illustrates how they can be integrated into a comprehensive Decision Support System that balances value to stakeholders with project imperatives and incorporates a lessons learned data base which enriches the decision making process to optimise delivery method design and selection.

Uncertainty avoidance: public sector clients and procurement selection

Purpose: Choosing the appropriate procurement system for construction projects is a complex and challenging task for clients particularly when professional advice has not been sought. To assist with the decision making process, a range of procurement selection tools and techniques have been developed by both academic and industry bodies. Public sector clients in Western Australia (WA) remain uncertain about the pairing of procurement method to bespoke construction project and how this decision will ultimately impact upon project success. This paper examines ‘how and why’ a public sector agency selected particular procurement methods. · Methodology/Approach: An analysis of two focus group workshops (with 18 senior project and policy managers involved with procurement selection) is reported upon · Findings: The traditional lump sum (TLS) method is still the preferred procurement path even though alternative forms such as design and construct, public-private-partnerships could optimize the project outcome. Paradoxically, workshop participants agreed that alternative procurement forms should be considered, but an embedded culture of uncertainty avoidance invariably meant that TLS methods were selected. Senior managers felt that only a limited number of contractors have the resources and experience to deliver projects using the nontraditional methods considered. · Research limitations/implications: The research identifies a need to develop a framework that public sector clients can use to select an appropriate procurement method. A procurement framework should be able to guide the decision-maker rather than provide a prescriptive solution. Learning from previous experiences with regard to procurement selection will further provide public sector clients with knowledge about how to best deliver their projects.

The big brother : monitoring urban growth and change for sustainable infrastructure provision

Monitoring urban growth and land-use change is an important issue for sustainable infrastructure planning. Rapid urban development, sprawl and increasing population pressure, particularly in developing nations, are resulting in deterioration of infrastructure facilities, loss of productive agricultural lands and open spaces, pollution, health hazards and micro-climatic changes. In addressing these issues effectively, it is crucial to collect up-to-date and accurate data and monitor the changing environment at regular intervals. This chapter discusses the role of geospatial technologies for mapping and monitoring the changing environment and urban structure, where such technologies are highly useful for sustainable infrastructure planning and provision.

Infrastructure project planning decision making : challenges for decision support system applications

Most infrastructure projects share the same characteristics in term of management aspects and shortcomings. Human factor is believed to be the major drawbacks due to the nature of unstructured problems which can further contribute to management conflicts. This growing complexity in infrastructure projects has shift the paradigm of policy makers to adopt Information Communication Technology (ICT) as a driving force. For this reason, it is vital to fully maximise and utilise the recent technologies to accelerate management process particularly in planning phase. Therefore, a lot of tools have been developed to assist decision making in construction project management. The variety of uncertainties and alternatives in decision making can be entertained by using useful tool such as Decision Support System (DSS). However, the recent trend shows that most DSS in this area only concentrated in model development and left few fundamentals of computing. Thus, most of them were found complicated and less efficient to support decision making within project team members. Due to the current incapability of many software aspects, it is desirable for DSS to provide more simplicity, better collaborative platform, efficient data manipulation and reflection to user needs. By considering these factors, the paper illustrates four challenges for future DSS development i.e. requirement engineering, communication framework, data management and interoperability, and software usability

Emerging urban futures, land, water, infrastructure

This paper will examine the intersection of design research and problem‐based teaching through the process and outcomes of a four year long ARC funded research project: the Emerging Futures Project. Sustainability is central to the project; in its overall content as well as in the broad aim of determining better outcomes for urban consolidation.   

Joint venture behaviour in construction industry : an Australia case study

Joint ventures can take many forms and can be formed for different reasons, from sharing resources to creating future business opportunities. At the same time, there is increasing interest and discussion of alternative procurement methods, moving away from traditional procurement systems to relational approaches. Business systems and strategies need to be redefined and move from a short-term project to project culture to a more strategic, long-term perspective. Joint ventures of construction organisations, global and local, have become increasingly popular to deliver large-scale infrastructure construction projects. However, successful strategic collaborations require project organisations to formulate a fit between contractual and operational arrangements for each situation. This study reviews the movement from traditional procurement methods towards relational contracting approaches in Queensland, Australia. The study examines the organisational factors that facilitates sustainable relationship between project organisations and hence, lead to long-term business success. This paper reports on initial findings captured from a survey undertaken with construction contracting organisations in Australia, focusing on the supply chain relationships. Contractors’ perceptions of the relationship management process and the engagement of the supply chain are also presented.

Performance of public private partnerships : an evolutionary perspective

PPPs are held to be a powerful way of mobilising private finance and resources to deliver public infrastructure. Theoretically, research into procurement has begun to acknowledge difficulties with the classification and assessment of different types of procurement, particularly those which do not sufficiently acknowledge variety within specific types of procurement methods. This paper advances a theoretical framework based on an evolutionary economic conceptualisation of a routine, which can accommodate the variety evident in procurement projects, in particular PPPs. The paper tests how the various elements of a PPP, as advanced in the theoretical framework, affect performance across 10 case studies. It concludes, that a limited number of elements of a PPP affect their performance, and provides strong evidence for the theoretical model advanced in this paper.

Social procurement and its implications for social enterprise : a literature review [Working Paper No. CPNS48]

This paper reviews the available academic and policy literature to identify the possibilities and limitations of social procurement, and the factors that enable its implementation. In doing so, it aims to contribute to an evidence-based approach to social enterprise development in Australia, and to provide practical information of use to both policy makers and social enterprises considering social procurement arrangements. Based on the available evidence, the dominant focus of this review is on social procurement by governments.

Research Monograph: Managing ubiquitous eco cities: telecommunication infrastructure networks, technology convergence and intelligent urban management systems

Efficient and effective urban management systems for Ubiquitous Eco Cities require having intelligent and integrated management mechanisms. This integration includes bringing together economic, socio-cultural and urban development with a well orchestrated, transparent and open decision making mechanism and necessary infrastructure and technologies. In Ubiquitous Eco Cities telecommunication technologies play an important role in monitoring and managing activities over wired, wireless or fibre-optic networks. Particularly technology convergence creates new ways in which the information and telecommunication technologies are used and formed the back bone or urban management systems. The 21st Century is an era where information has converged, in which people are able to access a variety of services, including internet and location based services, through multi-functional devices such as mobile phones and provides opportunities in the management of Ubiquitous Eco Cities. This research paper discusses the recent developments in telecommunication networks and trends in convergence technologies and their implications on the management of Ubiquitous Eco Cities and how this technological shift is likely to be beneficial in improving the quality of life and place of residents, workers and visitors. The research paper reports and introduces recent approaches on urban management systems, such as intelligent urban management systems, that are suitable for Ubiquitous Eco Cities.