Monday 31 August 2009

Strategic Planning For Multimodal Transportation Hub: A Case Study Of Chiang Sean Port 2 And Pakbara Deep Seaport Project

Nowadays, Thailand logistics development is in the level of Physical Distribution which supports only delivery of the goods to the consumers. This level also covers the activities of the transportation, the stock of goods, material management, and packaging of the products. Thailand logistics transport modes, however, are not integrated. The lack of efficient logistics in multimodal transportation logistics obstructs Thailand to be the good logistic hub. So the Government of Thailand needs to focus in transport infrastructure to link all modes to be multimodal transportation.

Since Thailand developed the strategic planning, the success appropriate level has not reached. One of main reasons is lack of continuity in implementation of plans, each implementation of plan is not developed in the same direction and all plans are not integrated together. In addition, due to limitated budget and resources. In order to optimize resources in the right direction and achieve highest efficiency, Thailand needs the strategic planning which be created by basing on the multimodal transportation to be the guideline and to be indicator to meet the goal. It is obvious that GOT needs to improve implementation plan of strategic planning because of the strategic planning is a vital part in budget allocation process.

Ms. Suphitcha Phoemphoonthanyakit made a research which aimed to improve the strategic planning for multimodal transportation hub development in Thailand. Her 3 specific objectives are to (1) investigate the existing strategic planning of multimodal transport logistics and to get the key multimodal transportation parameters so that the strengths and weaknesses can be identified, (2) find out the appropriate strategic planning for multimodal transportation hub development project; and (3) propose the recommendations for improving strategic planning which appropriates for multimodal transportation hub development project.

Her result showed that in order to develop multimodal transport projects, the key parameters which should be considered are technical development, project demand, project return, laws and regulations, environmental concern, resources availability, and political concern.

From the expert interview, the researcher found out that the root causes of problem come from:
a. The department does not have the same direction to develop their projects.
b. The department proposes the projects by lacking of consider the strategic plan under the ministry.
c. The department proposes the projects by aiming target that they have to get the budget of their project at least same amount of previous year or otherwise more then previous year.
d. The department proposes the projects by sticking on their function of work.
e. The department proposes the projects and conducts the feasibility study by themselves so the bias may occur in order to make the project feasible.

She also found out that the projects which each department propose could not meet the key parameters of multimodal transportation hub. The main factors that causes the case studies could not be the multimodal transportation hub are:

a. The case studies lack of railroad transportation infrastructure development project and have low the opportunities to be the hub due to the demand are not high.
b. The demand forecast of case studies are significant different from the actual demand from interview and site observation.

For budget allocation for multimodal transportation, researcher uses budget allocation process toward the case studies in order to find out the characteristic of budget allocation of case studies. After researcher towards the budget allocation process to the case studies completely, the researcher found that three main problems occurred.

The first problem is the budget allocation for four year implementation plan is not optimization. On the right way, the budget should be allocated to projects that are multimodal transportation instead because they can give more advantages to logistics transportation system. The root cause of this problem comes from, OTP could not develop the case studies by integrating with other projects in order to be multimodal transportation.

The second problem is the budget allocation for yearly implementation plan is not optimization. This problem is similar with the first problem. The difference is the excursion area, the first problem occurred at four year implementation plan but the second problem occurred at yearly implementation plan. The OTP could not develop the case studies by integrating with other projects in order to be multimodal transportation.

The third problem is no budget allocation to case studies. The root cause of this problem comes from:
a. Lack of continuousness in project development due to the political problem.
b. Lack of budget expenditure data of previous yearly during budget requisition forming.

Her thesis abstract is copied and posted.

ABSTRACT

Due to the main national policy of the government to strengthen the position of Thailand as the economic and transport hub of the region, it is necessary to develop the multimodal transportation which can efficiently link all modes of transport, i.e., land transport (highway and railway), waterway transport, and air transport so that it can reduce the national logistics costs and lessen the energy consumption of transport sector. Although Thailand has developed the strategic planning but still it has not reached the success up to the appropriate level as targeted. Moreover, Thailand has limitations in budget and resources. In order to optimize resources in the right direction and achieve highest efficiency, Thailand needs the effective budget allocation system to comply with multimodal transportation logistics plan.

A research has been done based on the two case studies which were conducted on the river port in the north part and deep seaport in the south part of Thailand. A qualitative research technique has been used by taking into account expert’s interviews, site observation, and main data source.

The finding of this study has shown that the strategic multimodal transportation planning of Thailand has some deficiencies and obstacles in project integration. Therefore, the recommendation of strategic multimodal transportation planning which is developed in the study will help the Government of Thailand, the Bureau of the Budget, Ministry of Transportation, and The departments under the Ministry of transportation, and other participants in project integration to follow the same direction and properly allocate the budget for the projects to achieve the multimodal transportation goal.

Wednesday 26 August 2009

Workers Participation In Safety Management System In Construction Projects In Thailand

The construction project faces many problems like accident during construction. Many researchers mentioned that maybe because most of the workers were unskilled since they worked before in agriculture but due to seasonal works, they changed their jobs. Moreover, they had their own unsafe habits from previous works especially in agriculture carrier.

In developing country especially in Thailand, to manage the system to provide safety for the workers and others from risks arising out of work activities, it is necessary for every employer’s concerned with construction (client, professional adviser or contractor) to recognize the hazards and manage operations to eliminate them as far as is reasonably possible (Davies and Tomasin, 1996). Hence, the manager level has to provide Safety Management System for the workers. However, the workers especially in Thailand need workers participation to implement as business core function since the company cannot choose better the safety programs whether they fit in best or not for the company. Besides, the accident happening rate in the construction project still remains at improper levels. Furthermore, by having an affective safety programs and the way workers participation can be embedded in organization because it can encourage mutual cooperation between management and workers in the operations of the programs and decisions that effect their safety and health (Aksorn and Hadikusumo, 2007, p.2).

Mr. Alvin Agustinus Gahari made a case study on “Workers Participation in Safety Management System in Construction Projects in Thailand” which primary objectives are to (1) investigate the workers participation in safety programs and (2) investigate methods to encourage the workers participation

Based on his research, below are the conclusions drawn:

1) Skill and knowledge, with clear safety program can encourage workers participation in safety organization.
2) Leadership, trust, open communication, skill and knowledge, incentive and clear safety program can encourage workers participation in risk analysis and method statement.
3) Open communication, incentive and clear safety program can encourage workers participation in safety inspection.
4)Clear safety program can encourage workers participation in safety training.
5) Trust and incentive can encourage workers participation in safety committees.
6) Leadership, trust, open communication and incentive can encourage workers participation in accident investigation and analysis.
7) Leadership, trust, open communication, with skill and knowledge can encourage workers participation in personal protection programme.
8) Leadership, skill and knowledge, with clear safety program can encourage workers participation in in-house safety rules and regulations.
9) Leadership and clear safety program can encourage workers participation in safety orientation.
10) Leadership, trust, open communication, skill and knowledge, incentive, with clear safety program can encourage workers participation in Job Hazard Analysis.
11) Leadership, trust, open communication, skill and knowledge, incentive, with clear safety program can encourage workers participation (overall).

His thesis abstract is copied and posted.

ABSTRACT

Safety in construction projects has greatly risen in current years particularly in Thailand. The relationship between workers participation in safety program and workers participation encouragement was very important in this study. It caused that different construction projects have generated some troubles, one of which is accident during construction. Accidents do not happen naturally but are caused by certain reasons, most of which can be predicted, controlled or avoided.

Prior to works begin can be happened by accidents, and also subsequent to the works have been completed can be happened by them, because of lacking design or construction, causing fatality or wound to those engaged on maintenance work and to members of the public. The success of any business counts on the workers and they are the bottom line as well. Protecting workers from hazards not only constructs good business sense, but also the right thing to do. In addition, manager level was able to erect Safety Management System with workers participation. Thus, it is proposed that this research was able to focus on safety responsibility in safety program, leadership, trust, open communication, skill and knowledge, incentive and clear safety program.
The required data was collected by using questionnaire survey. The objectives were to investigate the workers participation in safety programs and investigate methods to encourage the workers participation in Thailand construction project. The statistical methodology that used for examine the hypotheses was the Pearson’s correlation method. The result indicated that workers participation affects safety program. Some methods to encourage workers participation tended to follow safety programs.

There were 54 respondents returned questionnaires from their projects. All of questionnaires were visited personally and tracked through phone call and more visits were also conducted.
The construction projects that have in-house safety rules and regulations in their construction projects have a tendency to improve safety performance instead of without in-house safety rules and regulations. This safety program was the first rank or else the most important in this study. Furthermore, some methods can encourage workers participation in safety programs.
Further study is supposed to include not only less experience but also more experience especially for the person who has responsibility in safety. Moreover, this study would be better if it includes the estimation value of the construction project so it can be known the construction projects which have a good or bad safety program.

Tuesday 25 August 2009

Criteria For Infrastructure Project Selection: A Case Study In Cantho City, Vietnam

Vietnam has been successful in expanding access to infrastructure services over the past twenty years. The investment in infrastructure spreads all over the country, supports to growing economy, and expands the basic services to poor rural areas. Entering WTO since October 2006 offers Vietnam, new chances in economic expanding and opens new challenges for infrastructure as well. Dealing with high demand in infrastructure services, the Vietnam’s authority tries to attract capital from many sources of funds in order to expand and invest more infrastructure projects in both central and local government. However, the investments are still spreaded, uncompleted and the maintenance works are also neglected. One of main reasons is weakness and shortcoming in planning, selecting and budget allocating process. Setting project selection between different projects commonly accord with the absence of economic criteria. It will be a wasting of resource to carry out the project that brings the lower socio-ecomomical benefit compared with others. The efficiency and effectiveness of selecting infrastructure projects are hence the main concern of local authority.

Nguyen Thi Xuan Dan made a study to develop infrastructure prioritization criteria for each kind of infrastructure project at local government in Vietnam. His study focused on (1) in-depth understand laws and regulations for transportation project investment then specify shortcoming of regulations existed, (2) investigate and evaluate the current project selection process in Vietnam in term of criteria as well as procedure of so that its strengths and weaknesses can be identified; and (3) develop and propose criteria for each step of infrastructure project selection process in Vietnam.

He found out that there are many laws and regulation related to the infrastructure project investment. It consists of four main laws that are Law on Organization of People’s Councils and People’s Committees, Law on Budget, Law on Construction and Law on Investment affect the making investment project. Relevant laws include Law on land, Environment law, Law of tendering and Technical standards and grad of the project in Vietnam. In addition, there are a large number of Decrees, Circulars, and Guidelines for investing infrastructure project in Vietnam. In the review of laws and regulations and interview information, the three short comings of current regulations were identified: (1) taking long time to recommend, adjust when getting problems in large mechanism of Vietnam government with vertical horizon administration, (2) limitation of updated regulation documents, and (3) and deficient in good coordination of circulars and guidelines.

His study also pointed out some weaknesses that still exist in the current selection process such as (1) there is no establishment of criteria, guidelines and regulations for prioritizing project. Without prioritization, the project selection passes the conceptual and investment elaboration stage difficultly and complicatedly, (2) the setting up of criteria for project selection process is also not paid attention. The selection of project is based on this importance factor and project policy compliance under budget availability.

His thesis abstract is copied and posted

ABSTRACT

In accordance with the fast growing of socio-economic development in Vietnam, the demand for enhancing and expanding the infrastructure structure is very high. However, under budget limitation of developing country, local government should have an adequate selection to possibly pick the most promising project for investment. The objective of this study is to propose the criteria for selection process of infrastructure project of local government. In order to achieve this target, the investigation of existing project selection process was carried out to identify strengths and weaknesses three stages conceptual, investment project elaboration and approval stage of this process. Data collection related to the investigation was collected from legal documents, working report and interview information from Cantho, Vietnam. Using secondary data analysis, the study specifies five factors influencing the project selection. Since, the identification of criteria from these factors for each stage of selection process was eight, eleven, and six criteria should carefully consider in conceptual stage, investment project elaboration stage, and approval stage. Finally, based on the evaluation of developed criteria, recommendations are conducted for improving the criteria of infrastructure project of local government in Vietnam.

Monday 24 August 2009

An Owner’s Project Planning Approach For High Rise Building In Design And Construction: A Case Study Of Petrovietnam Commercial And Financial Centre

In Vietnam, the concept and practice of Owner’s Project Planning (Cost, Scope, Schedule and Quality) have been used in recent years. The purpose of Owner’s Project Planning is to: (a) describe briefly what project planning is and how it is carried out; (b) identify the major obstacles to effective planning and suggest ways of over-coming them (Laufer, 1989).

Mr. Nguyen Hoang Loc made a research to study the owner’s project planning approach for building project in design and construction and to develop a guideline for project owner to develop project plan to ensure the completion of projects.

He found out that the use of Owner’s Project Planning in the construction industry has greatly increased in recent years. Sophisticated technology-based products has required a high degree of design, manufacture, installation, and commissioning skills that have not been readily available to the industry’s Owners. As a result, Owner should outsource to contractors including Cost, Scope, Schedule and Quality, Procurement, Risk and Safety inspection.

However, many of contractor companies do not have the necessary expertise to undertake work satisfactorily and, as a consequence, are unable to give their clients the service they require. Therefore, owners need plan approach for building in design and construction which must be done by the project owner to ensure a successful completion of project, and owners needs to develop a strategy that allow him to manage contractor effectively and efficiently.

He also found out that there are similar owner’s projects planning strategy from local owners. It can be concluded that owner’s project planning strategy in terms of procurement and cost from local owners has been aligned and organized, but in terms of schedule, quality and safety aspects, it has been yet organized. Major improvements are needed for the owner’s project planning strategy in local owner in order to improve the contractor management performance. In contrast, it can be concluded that owner’s project planning strategy from international owner in case D, has been aligned and organized in all aspects. However, there are some major points, which need to be improved in order to strengthen and continually improve the strategy performance.

His thesis abstract is copied and posted.

ABSTRACT

In Viet Nam, the concept and practice of Owner’s Project Planning (Cost, Scope, Schedule and Quality) have been used in recent years. Owner’s Project Planning Approach for the High Rise Building in Design and Construction in the Construction Industry Development has been greatly important, especially high rise building projects. Project Planning is the bridge between the ideas and execution. The purpose of Project Planning is to define the exact parameters of a project and ensure that all the pre-requisites for Project Execution and control are in place. Project planning marks the completion of the Project Plan, no work is left uncovered. At the conclusion of Project Planning, the Business Case is revised and re-evaluated based on the completed Planning documents and a decision is again made to either halt the project, or to commit the resources necessary for Project Execution and control.

The Objective of Owner’s Project Planning is effectively and efficiently including Cost, Scope, Scheduling, Quality, Procurement, Risk, Safety, Manage the relationship in terms of partnering, Leadership Style and Communication. Therefore, Owners need to develop a Project Plan that allows him to control of Design and Construction for High Rise Building Project. In order to understand how the Project Planning is being operated together with the strengths and the weaknesses of high rise building in Design and Construction, Owner’s Project Planning Approach for Petrovietnam Commercial and Financial Centre were investigated through documentation, objective, problem, archival, and interview.

The planning of capital investment project is a project process, which processes from feasibility studies, to preliminary planning and lastly to detailed planning. In this thesis, the project has focused on normative techniques of planning and control namely.

Search in the current literature deals mainly with the following types of Owner’s Project Planning Approach for High Rise Building Project in Design and Construction:
- Cost planning.
- Scope planning.
- Schedule planning.
- Quality planning.
- Risk planning.
- Procurement planning.

Project Planning, especially from the Owner point of view, is a relatively new field. After more than a decade of intensive development it is still difficult to point at significant progress in the understanding of planning principles.

A number of key elements are added to the Project Plan, including project-specific items such as change control, acceptance management and issue management, as well as externally-focused items such as organizational change management and project transition. The initial list of project risks is augmented, and detailed mitigation plans are developed.

Wednesday 19 August 2009

Motivation Of Construction Engineers In Ho Chi Minh City, Vietnam

The economy of Vietnam grows rapidly, especially in HCM city which has always reported as have high levels of economic activity, constantly leading in terms of economic growth since entering WTO. Under the strategy for industrial development to 2010 and the vision for 2020, HCM City is expected to become an industrial city by 2015 and play the role as an economic driver of the southern focal economic zone and the whole country. These development policies provide a chance for development of construction industry in the City. On the other hand, the HCM city people’s committee will have new policies to improve the goal of construction industry. One of these is increasing the productivity of construction engineers through motivation of construction engineers.

In industrial construction, one of the issues confronting constructors and owners of construction project is how to improve construction productivity. Stated in another way, how can construction projects be completed cost effectively? It is believed that increasing construction engineer productivity through improved motivation would result in significant savings in construction costs. The behavior of engineers affects project productivity. There fore, the study of engineer motivation is very important.

Mr. Nguyen Duy made a case study to know the wants of the construction engineers in HCM City, Vietnam and how it contributes to effective motivation policies and programs to increase their productivity. His study’s objectives were: (1) to survey construction engineers’ needs and their satisfaction in the Vietnam construction industry; (2) to propose some recommendations to motivate construction engineers working effectively; and (3) to specify the validity of the expectancy theory toward motivation of construction engineers in the Vietnam construction industry.

Mr. Duy’s concluded that the construction engineers’ needs and satisfactions did not meet. Almost all engineers considered a three high need factors such as good orientation and training, good relationship with colleagues and good welfare condition. The company must be properly addressed these factors if it wants to carry out the policy that will motivate the engineers effectively.

The result of his study implies that engineers’ general satisfaction and intrinsic satisfaction are higher than satisfaction on their need factors. This means engineers’ professions are attractive for them, but the outcome of work can not meet their needs successfully.

His study also illustrated that the validity of expectancy theory was not strongly supported. But expectancy theory still provided a conceptual base for understanding the motivation of construction engineers. Analyzing the relationships predicted by expectancy theory implied that job clarify is useful to improve the expectancy of engineers even though the expectancy has no strong relationship with effort and performance.

His thesis abstract is copied and posted.

ABSTRACT

Construction industry is the one that drives virtually ever economy. It is needed to provide the infrastructure, plants, industries and houses for the population. For the industry to serve the economy it needs resources. One of the most important and critical resource in construction is manpower. This resource, unlike other resources, is the only one that free will. As a result, it is important for manager of construction to understand the factors that influence construction engineer performance. To motivate construction engineers, it is necessary to know how they respond to their environment and what they need. A survey was developed base on expectancy theory. This survey was conducted in construction industry in HoChiMinh city, Vietnam. The study was carried out to determine the factors that affect the motivation of engineers, for example, physiological (breathing, food, water, sleep,...), safety (security of body, of employee, of health..), belonging (friendship, family, ..), esteem (confident, respect by others, achievement,..), self-actualization (morality, creativity, acceptance of facts,…). Hence, proposing some recommendations to motivate construction engineers working effectively. Further more, this research also specify the validity of the expectancy theory toward motivation of construction engineers in the Vietnam construction industry.

Tuesday 18 August 2009

Financial Management For Small And Medium-Sized Enterprises In Construction: Case Study In Thailand And Indonesia

Southeast Asia is now developing the small and medium sized enterprise which becomes the backbone of the economy of the particular country. In Thailand and Indonesia, construction industry influences the economic growth. The interesting fact is that in Thailand, construction relies more on small and medium-sized enterprises or “SMEs” which construction plays significant role in influencing the GDP of the country. Indonesia has more or less similar circumstances as that in Thailand where small and medium contractors have an important role in process of growth domestic product. As the major part of construction industry in Indonesia, the development of construction SMEs will be essential.

Ms. Vivi Megawati made a case study to understand how the entrepreneurs manage their construction SMEs and the fundamental system they adopt for the financial management.

Her study mainly aims to investigate and assess operational factors that affecting the financial capability of the Construction Small and Medium-sized Enterprises. Identifying the key operational point will help the construction SMEs to enhance their financial capability. To accomplish her study’s the main objective, she outlined three sub-objectives to (1) identify key operational parameters affecting financial management in construction SMEs; (2) investigate the existing financial management practices affecting the financial outcome of construction SMEs; and (3) propose recommendation for financial management that are appropriate for construction SMEs in handling with the key operational parameters

Her conclusions based on the result of her survey.

1. Financial management in construction SMEs - it is found that construction SMEs is vulnerable to financial crisis due to the misconduct of financial management. Improper management practices have brought some construction SMEs to financial difficulties and even bankruptcy. It is can actually be avoided through appropriate financial management according to the character of construction SMEs itself.

2. Indonesian and Thai SMEs practice in financial management - construction SMEs both in Indonesia and Thailand exhibit the misconduct in financial management. However, some companies involved in the study are seen to have adequate financial management to sustain the business. The size of the firm usually determines the properness of financial management although in some parts, decision maker structure does.

Her recommendations for Thai and Indonesian construction SME owners in managing the financial management in securing long-term competitiveness are the following:
1. Thai SMEs can consider decentralization in purchase authority to expand the business since centralized purchase authority is cumbersome for some extent. Decentralization allows prompt purchasing which can affect the productivity especially when the size of the project is big.

2. Indonesian SMEs can be more professional in financial management. If the company wants to expand the business, Indonesian SMEs can raise long term debt for higher capital to be able to bid higher project.

3. Improve inventory management. The construction SMEs must properly and promptly update and record any changes made in inventory especially in balance sheet. Stock card may become the good instrument to monitor the flow of inventory. Depreciation can be applied to formalize all the inventory purchasing made by the company. For the second-hand equipment which is usually used until it has no salvage value, the depreciation can still be applied to the value of zero.

4. Construction SMEs must have good and competent estimators. Without the owners involvement in the technical operation (as estimator or project manager) it is necessary to have good and competent estimator which is accompanied by project manager or site manager for more accurate estimation.

5. Construction SMEs must consider other ratio analysis. Bank as the loan provider examine the company based on their financial performance shown in their financial ratios. Thus it is necessary for the owners or managers to recognize the important ratio analysis such as liquidity ratio, Debt/Equity ratio and debt service coverage ratio (DSCR) which is produced from reliable and exact financial statement. It will help construction SMEs to get access to loan from formal sources.

Her thesis abstract is copied and posted.

ABSTRACT

Construction SMEs are the backbone of the construction industry both in Indonesia and in Thailand. However, the management is seldom maintained properly to achieve the optimal outcome. The study focused on the financial management of construction SMEs which affect the whole operational and determine the success of the firms. The study aims to investigate the financial factors and the interrelation between each factor which influence the financial outcome and financial capability and recommend the effective operational method for financial management.

The study uses case study as a research design. The processes begin with factor identification which consists of preliminary factor and verification of the factors. It is the continued with the data collection using the abovementioned factors to design the case study question. Data analysis is conducted toward the evidences using explanation building method in which all the important evidences are revealed and explained.

Results from factor identification shows that financial function in construction SMEs can be divided into four major parts namely: 1) money management, 2) accounting, 3) financial controlling and 4) financial advisory. The money management itself is the integration of three sub-parts: financing decision, working capital management, and investment decision. Accounting consists of recording and reporting process. Financial controlling concern both project and organization financial control. Eventually, financial advisory concern the advisory process which base the decision taken within the company regarding financial control system, dividend and retained earnings, income diversification, and tax planning. The framework shows the interrelation between each factor is developed. The causes, consequences, and recommendation for handling with all the factors mentioned above were discussed in this study.

Monday 17 August 2009

On Site Cost Control System In Construction Company In Viet Nam: A Case Study Of Three Construction Companies In Ho Chi Minh City

Cost control is conceived to ensure that costs stay in line with the planned needs established by the company to achieve economic targets. Every construction firms needs information about costs in order to plan, evaluate, decide, and budget, among other purposes. The cost control is a process that should be continued through the construction period to ensure that the cost of the building is kept within the agreed cost limits. The cost control can divide into two major areas; the control of cost during design stages and the control of cost by the contractors once the construction of project has started. The main objective of cost control is gaining the maximum profit within the designated period and satisfactory quality of work.

Most of Viet Nam Construction Company have cost control system established by themselves; but the systems are system less and ineffective. Mr. Le Hai Son made a case study on “On Site Cost Control System In Construction Company In Viet Nam: A Case Study Of Three Construction Companies In Ho Chi Minh City” to understand the current practice in their organization and explore what factors are effective or deficient that needs improvement.

His study was carried out to study the cost control method in a construction project, to identify the cost control method frequently used by the contractor during the construction stage and to identify the problem faced in controlling the costs on site. The objectives of his study are (1) to study and understand the current on site cost control system in Vietnamese construction companies; (2) to investigate and identify effectiveness and deficiencies cost control system; the factors caused those effects in relation with measurement identification; and (3) to recommend how to improve the cost control system of company base on the attributes founded.

His study revealed that the common trend in Vietnam Construction Company is that cost control procedure has not been systematized. The organizations have initiated a development plan and only a few of them have successfully established their cost control systems. This shortage, therefore, is a major factor that causes contractors' business failures during the current economic recession period. They used the system designed by themselves and applied for all projects they achieved.

Mr. Le Hai son’s study also revealed that site personnel in the organizations have less participation in cost control. According to the companies' policies, the budget is set and solely approved by head office. Normally, head office doesn't let site personnel know budget and assigned them to control only in term of quantity. As a result, site personnel have no cost-conscious mind and are not motivated to monitor and control cost. For cost analyzing and reporting, the responsibility is taken by accountants who can generate information based on bills and invoices. Certainly, the generated cost information can't reflect the real on-site situation and can't provide great benefits to management to take right and timely corrective actions.

In this case study, most of cost codes system used by the contractor or construction management company is not examined to identify their effectiveness in controlling project costs. Therefore, monitoring of actual expenditures of each work item and monitoring of work progress in comparison with budget and actual cost can't be achieved.

His study found some problems that affect to cost control system of company come from following reasons:

1. Human factors and type of training cost engineers –Viet Nam does not have professional estimators, hence construction management on cost control had not yet assessed appropriately. Training mission to provide engineers and expert in this field had not yet considered important.

2. Estimate norm - Viet Nam has many norm systems, but they are deficient, inadequate and complicated. Many construction works in norm are not appropriate with reality leading cost management, setting up estimate, verifying, approving and executing have difficulties during last period.

3. Material calculation method - it is necessary to have a regulation that stipulate adequate real cost, it can be considered that we can follow the announcement from prestige supplier; therefore we can compare and chose.

4. Labor cost calculation- each province has different comprehension and calculation method about labor cost and caused difficulty in establishing and managing the cost.

5. Treat inflation for construction buildings- the internal and international market price have powerful fluctuation.

6. Reserve expenditures for building construction -With the regulation for reserve cost about fifteen percentages “for feasibility study” for both inflation and quantity are not appropriate. Modification of the project, additional cost and efficiency investment can not avoid and the difficulties with investment project from capital sources will increase.

His thesis abstract is copied and posted.

Abstract
In a recent consulting assignment we realized that there was some lack of understanding of the whole system of project cost control, how it is setup and applied. Consulting engineering companies need an adequate cost control system to improve their profitability and productivity. It is important to keep current on a project's cost by maintaining a reliable cost control system. Most of Viet Nam construction companies do not have an appropriate cost control system that can maintaining a reliable cost control system ;enables a contractor to analyze the productivity of workers, the performance and efficiency of equipment, the cost of materials, and the proper allocation of overhead expenses. The goal of this study is surveying current practice about cost control system in Viet Nam construction company and suggestion factors for improving the system. The study was implemented with case study from three different scale companies. For assessing effectiveness and deficiencies, the system from three companies were evaluated by comparing with measure identification propose by Eknarin Sripraset (2000). The survey indicated that most of systems are self design ; in addition there is no integration between code accounting and cost code. These two main factors contribute to the deficiencies of the system and make the company loss severe benefit.

Wednesday 12 August 2009

The Roles Of Lao Governtment On ADB Implementation Of Financial Partnership Strategy

Asian Development Bank (ADB) is a monetary institute to implement Financing Partnership with its clients in Member Developing Countries (MDC). ADB has to formulate its strategies agenda to respond the need and challenges of world’s dynamics. Lao P.D.R. is a member development country of ADB. Both of Lao government and ADB conduct the FPS together for poverty reduction in many sectors economic through Country Strategy and Greater Mekong Subregion Program (GMS). Presently, the Lao government recognizes that the social developments are required economic growth. The development of infrastructure system, human resources, agriculture and health need financial partner, because of financial term and capacity-building from both government and private. But Lao government officers still have less experience on preparing financial partnerships management. Many projects in Lao P.D.R met with inadequate financial infrastructure. In short, ADB Financing Partnership strategy is the complex process and needs the efficient coordination with partners and clearly articulated execution to lead to the goals. The proper collaboration of ADB and Lao government are provided virtual lesson and it is able to prevent consequent problems and reduce conflict between ADB and Lao government or third party partners.

Mr. Phouthasen Sinthavong made a case study on “The Roles Of Lao Governtment On Adb Implementation Of Financial Partnership Strategy: A Case Study Of Vientiane Urban Infrastructure And Services Project’ which major objective is to find out treatment method for the FPS improvement, when such problems arise. To achieve the study’s major objective, three sub-objectives were needed to (1) to investigate the current strategy on ADB implementation of the FPS approach to encourage Projects or program in Laos; (2) to identify the strength and weakness of applying the FPS under project or program of ADB encouragement; and (3) to propose recommendation on how to improve the implementation of FPS between ADB and Lao Government for project or program encouragement.

He found out that the Lao government promulgated the Law on Local Administration to support urban revenue collection. It was recognized in Law on Local administration and empowered to raise local revenue for provide of urban service. The mechanism operation was slow than target date this affected directly to the implementation of VUDAA on revenue collection. Paralleling with the Law on Local Administration, Local governor issues the decree regarding fees and charges but there still was a need for further refining as to how the fees and charges were assessed and how they will collect. However at the project completion the base fees and charges were insufficient to provide the type of service. However, the project was completed by its main objectives; this is fundamentally the consequence of Lao government support.

He also found out that ADB’s undertook thirteen Review Mission, including the inception Mission and Midterm Review Mission. The Review Mission was the good performance of ADB to monitoring the project implementation. Each Review Mission met the problems and they were solved among the financial partners. This operation should illustrate the sufficient and efficient result to other project. Additionally, there are some weaknesses of ADB implantation on applying the Financial Partnership to the project implementation in Laos. Although the AFD funded component for Capacity Building was undertake within the same office ADB component and the Review Mission proposed that there was close cooperation between VUDAA management and ADB funded component in aspects of the project. The Review Mission also proposed that Review Mission were undertaken by ADB without the involvement of AFD.

His thesis abstract is copied and posted.

ABSTRACT

The infrastructure development in Laos, especially Vientiane, requires a great of number capital for investment. The financial partnership with monetary institute is critical way to develop infrastructure for Lao government and it will be accelerator to catalyst the economic growth and reduce the poor among community.

This research aims to investigate the financial partnership between Lao government and Asian Development Bank, which is a monetary to support fund for development in Asia Pacific. How the Financial Partnership be done and its effect after conduction is the main objective to meet in the research. Eventually, the result from displayed that there are many flaws from the implementation of Lao government on involve project implementation and financial partners such as; lack of better liaison initial among financial partner, Low competency of Lao employee, inadequate financial infrastructure in Laos and low of planning and control and equipments. To meet the efficient infrastructure development, Lao government continued to operate the Financial Partners is not only with ADB but also other monetary institutes or the other governments, whom are interested to assist Lao government for country development.

Keywords: financial partnership strategy; financial infrastructure; financial partner; fund; implementation; ADB

Tuesday 11 August 2009

Corporate Social Responsibility In Vietnamese Construction Industry

Corporate social responsibility (CSR) is a new concept for Vietnamese businesses in general and for construction firms in particular. It has become more familiar in recent years especially after Vietnam has enacted and implemented its “Doi moi” (renovation) policy since 1986 and has been gaining more and more significant economic goals. According to Post et al (2002), “CSR challenges businesses to be accountable for the consequence of their actions affecting the firm’s stakeholders while they pursue traditional economic goals.

The general public expects business to be socially responsible, and many companies have responded by making social goals a part of their overall business operations”. There are a lot of studies on CSR of businesses in general and other industries but there are few studies concentrating particularly on CSR in construction industry. Since Vietnam’s concept on CSR is not yet established, Mr. Tran Huong Quang made a study on “Corporate Social Responsibility in Vietnamese Construction Industry”. The main objective of his study is to understand the current status, attitudes and the awareness toward CSR in Vietnamese construction companies through their principles of conduct and evaluating the CSR performance.

His specific objectives are: (1) to understand the attitudes and the awareness of CSR in Vietnamese construction companies; (2) to explore the current status and performance of CSR in construction companies; (3) to find out the influence of other relevant factors to CSR performance in construction companies; and (4) to propose recommendations for CSR performance improvement.

His conclusions based on the result of his study are:
1. Attitude and awareness toward CSR - generally, Vietnamese construction managers have positive attitude toward CSR and good interest in CSR concept. A considerable percentage of managers understand CSR well and can recognize the benefit of CSR while some have bias perception.

2. CSR performance - most organizations have above average CSR performance score which generally come from certain “good characteristic” or objective advantages of construction industry rather than organization’s own efforts.

3. Influence of factors - CSR requires a bunch of indicators to be examined and controlled simultaneously which becomes a burden for every construction companies especially small and medium sized. The research shows that in public companies, there are some CSR indicators with good performance. “Sheer” public companies and similar still play important roles in Vietnamese economy, public equity exist strongly in those companies and the government somehow participates in decision making in those companies. This power is a good advantage for Vietnamese government to initiate many CSR promotion programs.

His thesis abstract is copied and posted.

Abstract

During recent years, Vietnam, a developing country, is one of the most rapidly developing economies of the world. Among its objectives, sustainable development is essential. Together with attaining some Millennium Development Goals such as reducing poverty, faster growth, improving quality of education, gender equality…, Vietnam has been delivering more and more effort for its sustainable development.

Today’s heightened interest in the role of businesses in society has been promoted by increased sensitivity to and awareness of environmental and ethical issues. Issues like environmental damage, improper treatment of workers, and faulty production that inconveniences or endangers customers are highlighted in the media. Corporate social responsibility (CSR) is closely linked with the principles of Sustainable Development and the wider aim of CSR is to create higher and higher standards of living while preserving the profitability of the corporation.

The Construction industry is a large and diverse component of any economy. Its positive contributions for the social through many deliverables are undeniable. But there are still inadequacies inside the industry which has been criticized by lots of researchers. The author would like to conduct a research based on a case study and a survey to assess the attitudes and the awareness toward CSR in Vietnamese construction companies through their principles of conduct and evaluating the CSR performance. By the way, the author would like to discuss about some suggestion for CSR performance improvement and devote his effort in a hope that it may give a small contribution for enhancing CSR among construction companies in his beloved country.

Monday 10 August 2009

Conflict Dynamics in Dam Construction Projects: A Case Study of Middle Marsyangdi Hydroelectric Project, Nepal

In any construction projects, conflicts exist. The bigger the projects are, the more it face many disagreements. Dam construction project involve multidisciplinary teams and interdisciplinary activities. The limited time and physical resources has added the another complexity to the construction process. Different stakeholders have different objectives, perception and priorities. The difference in attitudes often creates conflict (Awakul and Ogunlana, 2002a) and as a result of which most of the projects are set aside at the planning stage whereas others are subject to conflicts during the execution stage causing enormous time and cost overruns.

Mr. Braj Kishor Mahato made a case study on Conflict Dynamics in Dam Construction Projects in Middle Marsyangdi Hydroelectric Project in Nepal which aimed to develop a model for comprehensive and integrated approach of conflict management to manage the conflicts effectively, efficiently and equitably early in a project’s life using system dynamic modeling technique.

His study’s overall objective is to thoroughly understand and develop a simulation model for comprehensive, integrated and proactive approach of conflict management in dam construction project. The model will be helpful for project manager to assess and take proactive measures to manage the conflicts effectively, efficiently and equitably early in a project’s life. However, his study’s three specific objectives are to (1) identify and explore pertinent conflict factors in dam construction projects; (2) develop a model to understand the dynamics of conflict in dam construction project using system dynamics modeling technique; and (3) use the model to derive viable policies for minimization of conflict at construction stage in dam construction projects.
His major conclusions made in this study are as follows:

1. Most interesting fact found from model simulation is intensive public hearing prior to final decision at earlier stage surges conflict forward and minimize overall conflict at later stage.

2. Discloser of project related data to project stakeholder is not only surging conflict forward but also reducing it at construction stage.

3. Intensive public participation at early stage of project will decrease over all interface conflict in project. Public participation and consultation at early stage of project guarantying access to all stakeholders including disclosure of all data, both positive and negative, for public knowledge will reduce the anxiety of local people about the project and establish transparency beyond suspicion which will reduce confrontation at later stage.

4. It may be concluded from the simulation that discrepancy in compensation payment, resettlement and support programs can be minimized by effectively involving project-affected people in formulation and implementation of compensation, resettlement and support program

5. Proper implementation of programs related with resettlement of project affected people (project employment, compensation payment, support programs) will reduce interface conflict at later stage of project.

6. Increasing monitoring and reporting surge interface conflict slightly forward which will give opportunity to project team to take proactive action.

His thesis abstract is copied and posted.

ABSTRACT

Interface conflict is identified as one of the major problem in dam construction projects. Differences in attitude and interest often create conflict as a result of which many projects are set aside at planning stage whereas others are subject to conflict during execution stage. Conflict in execution stage causes prolonged delay, enormous cost overrun and at worst abandon of project. Proper management of conflict can determine success or failure of a project. Thus it is crucial to identify the root-causes of interface conflict in present and past project to avoid such problems in future. Qualitative data gathered from the case studies, interviews conducted in Nepal and an intensive literature review has helped to develop a system dynamic model to explore and examine full context of interface conflict theoretically and practically in dam construction project. Reference mode approach was used in modeling based on literature and expert views on the typical evolution of key indicators of interface conflict. This study discusses factors that influence development of interface conflict in dam construction project in Nepalese context.

This study reveals that interface conflict at construction stage of project is caused by lack of effective public hearing prior to making final decision, public participation and information disclosure at early stage of project, insufficient education and training program, discrepancy in compensation payment, resettlement and support programs. Public involvement and mutual consultation considering guaranteed access to all stakeholders, public hearing prior to final decision will increase the public acceptance of the project. It will be easier to reach on agreement on conflicting issues when the stakeholders are well informed and empowered. Disclosure of accurate and timely information for public knowledge will reduce the anxiety of local people about the project and establish transparency beyond suspicion.

Discrepancy in compensation payment, resettlement and support programs can be minimized by (i) effectively involving project-affected people in formulation and implementation of compensation and resettlement program (ii) formulating comprehensive and inclusive national policy to resettlement issues in dam construction project. Education, training and support programs to the project-affected people will provide opportunity to restore their livelihood and create positive perception of community about dam project. Study also identified that monitoring and reporting will allow for identifying success stories to be replicated and avoiding the failure, which will ultimately decrease the negative perception of community about dam project. This will reduce interface conflict in future dam construction project.

Wednesday 5 August 2009

Safety Rules And Procedures Development And Implementation: A Study On Construction Industries In Thailand

The construction industry is known for its poor safety performance when compared with other industries. According to Mohamed (1999), construction accident contribute to many human tragedies, de-motivate workers, disrupt site activities, delay project progress and negatively affect the overall cost, productivity or even the industry’s reputation.

Many researchers made a lot of studies to find ways in having a concrete safety measures to be applied in the construction firm to minimize these related accidents.

Mr. Andreas Adihartanto made a case study on the “Safety Rules and Procedures Development and Implementation” that Thai Construction firms are now applying. The main objective of his study is to investigate effective ways to manage safety rules and procedures when they have to deal with several types of violations. However, to attain the main objective, several sub-objectives were also proposed in his research to (1) investigate the prevalent safety rules and procedures practices in the construction industry in Thailand; (2) explore the relationship between organizational culture attribute and safety rules and procedures development and implementation; (3) examine the relationship between safety rules and procedures development, implementation and type of worker’s violations; (4) explore the relationship between leadership styles and types of safety rules and procedures violations; and (5) As an initial research to investigate the possibility of the “Peltzman Effect” occurrence in construction safety.

Mr. Adihartanto’s conclusions:

SRP’s practices in the construction industry in Thailand

He found out that there were no significant differences between medium-sized and large-sized construction projects in the way they develop and implement SRPs. Most of the SRP’s development variables were scored as high which indicated that contractor companies in Thailand typically take into accounts all of these variables when they develop their SRPs. However, during the implementation, they do not prefer to provide SRPs in form of writing documents (safety cards, manuals, etc.) to all of the workers, including translating written SRPs to the workers’ native language. Further analysis revealed a predisposition that management exploits these variables merely as of value to protect their back from the workers’ excuses. Regarding the translation of written SRPs, most respondents preferred to utilize interpreters to communicate their safety messages into the workgroups in which commonly they are the head of the groups. Therefore, it can be concluded that workers’ type of violations were occurred in similarity, in which they were ranging from erroneous to routine violations.

Organizational culture and SRP’s development and implementation

His analysis result indicated that neither of the clan nor the hierarchical culture attributes is more superior and effective in the development and implementation of SRPs. Each of these attributes has both positives and negatives. It is suggested therefore, that it is much more important for the management to understand the strengths as well as the weaknesses of particular attributes in their relation to the SRP’s development and implementation in order to make necessary adjustment for their organizational effectiveness.

Safety rules and procedures which were known to be complicated or confusing were adjusted, and it is more likely that they willing to put operatives’ suggestions into the rules development. However, in this kind of organizations, drawbacks are resulted from the management deficiencies in supporting their site operation as apparently, the availability of the SRP’s documents to the workforces and maintenance of safety visual signs were insufficient. Therefore, the decisions are skewed more on the management’s side.

SRP’s development and implementation with the type of worker’s violations

The result came with some SRP’s development and implementation variables that could potentially reduce particular type of violations. Therefore, it should be pointed out that mismanaging some of these variables could potentially promote violations. Although the rest of the variables were not found in contributing to the reduction of any type of violations, it is still suggested that management takes these variables into their Hierarchical Attributes Negatives Positives Operation, technical support deficiency Open-systems approach Bureaucratic approachOrdered, well-arranged Procedural rigidity, over reliance Output maximization, torientedClan Attributes Towards FlexiTowards Centra consideration when developing and implementing their SRPs. Table 5.3 and 5.4 below summarizes the analysis result analysis in which they portrayed the potential of each SRP’s development and implementation variable to reduce particular type of violations.

Leadership styles and type of worker’s violations

The result signifies the need for the Safety Officers to carefully understand the impact of their leadership behaviors. It is suggested that emphasize should have been taken to minimize the negative effect of the leadership styles rather than to reduce them. Based from the observations on-site combined with the analyses results, the researcher postulated that the problem largely relies on the workers’ perception. Thus, safety trainings were suggested to address this problem, particularly to take bigger portion in correcting workers’ perception.

5. The Peltzman Effect

In terms of workers’ activeness in safety programs participation, this study did not identify the presence of Peltzman Effect. However, further studies are suggested to investigate this phenomenon from different angle.

His thesis abstract is copied and posted.

ABSTRACT

This study was carried out to identify problems associated with the development and implementation of safety rules and procedures (SRPs) to ensure worker’s compliance and to give an insight of effective solutions to overcome these problems. The discussions were broadened to identify the influence of organizational culture to the SRP’s development and implementation, the potential of leadership styles in handling particular type of violations and the possibility of the Peltzman Effect occurrence in the construction industry.

The result revealed that several SRP’s development and implementation variables have a great potential in reducing particular type of violations. Therefore, management should be aware that mismanaging these variables could potentially promote violations. In general, the finding suggested that SRP’s should be: (i) developed following project risks assessment, (ii) designed so that it will not over restricted individuals working efficiency, and (iii) designed considering operational difficulties. As well, during the implementation, SRP’s should be: (a) available to all of the workforces, (b) implemented alongside with varieties of safety trainings, and (c) enforced by providing wide ranging of PPE or any other resources necessary to do the job safely.

Furthermore, the findings also suggested the need for the management to understand the strengths as well as the weaknesses of the particular organizational culture attributes in their relation to the SRP’s development and implementation in order to make necessary adjustments for their organizational effectiveness. It is also suggested the need for the Safety Officers to carefully understanding the impact of their leadership behaviors. At last, in terms of worker’s activeness in safety programs participation, this study did not identify the presence of the Peltzman Effect.

Tuesday 4 August 2009

Framework Implementation Of Reduce, Reuse, Recycle, And Residual Management For Thai Building Construction Industry

In 1972, the first conference in sustainable development was held at Stockholm, Sweden. Since then, several countries all over the world have put a great emphasis on this issue and have accepted it as the major concern in a mainstream. A number of conferences and summits have been organized in order to ensure that the world has met the requirement of sustainable contents. Many countries have signed an agreement to accept the agenda in processing the implementation of sustainable development concept across all industries, especially in construction industry. Consequently, “sustainable construction” is the term commonly used in representing sustainability in construction industry.

In term of sustainable construction, material waste is one of key issues (DIT, 2000). The waste has a directly crucial impact on environment. The obvious effect of which which can be easily observed is the rapid achievement of landfill site. A number of studies tried to find out the causes of the construction material waste and the approaches to minimize the waste. Since the waste minimization and management are the important issues toward the sustainable construction, Mr. Pakawat Pormmoon made a case study concerning the systematic formulation of framework through 4Rs (reduce, reuse, recycling, and residual management) waste management strategy for managing the construction material waste on sites. This framework is hoped to enable the construction companies to deal with the construction material waste.

Mr. Pormmoon’s research objective is to develop the 4Rs framework implementation for the construction industry. In order to achieve this main objective, the three
key objectives were also set to (1) investigate the existing activities relating to the concept of reduce, reuse, recycle, and residual management in Thai building construction industry; (2) test the validation of collected 4Rs-relevant activities; (3) develop the framework implementation following to 4Rs concept.

The result of his case study based from the interview revealed that ten general issues can be implemented through 4R’s concept. These issues include (1) environmental policy; (2) nearly Just-in-time delivery; (3) waste management plan; (4) use of long-life construction material; (5) standardization of design; (6) design and build scheme; (7) project quality plan; (8) off-site prefabrication; (9) supply chain alliances with suppliers and recycling companies; and (10)“Take-back” scheme.

However, upon detailed implementation of each “R” in 4Rs, many activities have been arisen. These activities were categorized as (a) improvement of material ordering and supplying; (b) changes of material selection; (c) improvement of site material management; (d) increase of work controlling; (e) defining of alternative options for reuse and recycle; (f) provision of sorting methods and container, area, or infrastructure for collection of by-product; and (g) setting of policies according to the relevance law and regulation; Residual Collection and Residual Disposal

Another finding of his study validated that 4Rs have many relevant activities such as:

1) General Issues
a. To set up environmental policy in order to contribute the implementation of 4Rs (reduce, reuse, recycle, and residual management) principle in practices

b. To apply ‘nearly Just-in-time’ delivery principle in order to reduce and alleviate the congestion of material movement on site
c. To encourage the use of Design and Build scheme to deliver project in order to utilize use of value engineering concept

d. To enhance the use of standardization of design in term of modular system to improve buildability and reduce the quantity of off-cuts on site

e. To increase the use of off-site prefabrication to control loss, waste, and damage, thus, the off-cut can be reduced

f. To enhance the use of long-life construction materials such as steel, standard wood, and others to construct building components; therefore those structures can longer be used

g. To develop Project Quality Plan for managing construction materials on site

h. To develop Waste Management Plan for managing waste on site

2) Reduce at management level
a. Improvement of material ordering and supplying
b. Changes of material selection
c. Improvement of site material management
d. Increase of work controlling

3) Reduce at operational level

4) Reuse and recycle at management level
a. Defining of alternative options for reuse and recycle
b. Provision of sorting and collecting methods, container, area, or infrastructure for collection of by-product

5) Reuse and recycle at operational level

6) Residual management at management level - Setting of policies according to the relevance law and regulation

7) Residual management at operational level

His study’s last finding is that application of each 4Rs-relevant on sites and its implementation can be done at both site management and operational level as implemented by Bovis Lend Lease (Thailand) Limited. It yields a better work execution than other companies at site management level.

His thesis abstract is copied and posted.

ABSTRACT

The problems regarding to sustainable construction are that the most of construction materials are considered to be low efficiently used. The less efficient use of construction materials will not be a problem if the natural resources are limitless, but in fact it is not. In addition, the construction firms need to be reminded that waste make financial cost both direct cost and indirect cost are significant. Many researches have tried to apply the 3Rs (Reduce, reuse, and recycle) waste strategy for managing waste on construction sites. Consequently, this study has tried to apply the concept of 4Rs, reduce, reuse, recycle, residual management concept in Thai building construction industry. To apply 4Rs, reduce, reuse, recycle, residual management concept in Thai construction industry is the main purpose of this thesis.

In order to correlate the main and the sub-objectives of this study, research methodology has been split into three main steps. The first step is to investigate existing 4Rs-relevant activities. The result is that the related activities following 4Rs concept. These activities would be utilized in the next step, gathering the significance and applicability of collected 4Rs-relevant activities. The second step, some activities have been removed. There are six experts utilized in the second step. The last step is to measure the application of each 4Rs activity on sites at both management and operational level. The data in last step were
collected from both Bovis Lend Lease (Thailand) Limited and other companies within Thai building construction industry.

The results were found that validated eight general issues can be implemented through the 4R’s concept. Moreover, there are eight groups of work which 4Rs concepts can be implemented through that are improvement of material ordering and supplying, changes of material selection, improvement of site material management, increase of work controlling, defining of alternative options for reuse and recycle, provision of sorting methods and container, area, or infrastructure for collection of by-product, and setting of policies according to the relevance law and regulation.

Monday 3 August 2009

Total Quality Management In Property Development Projects In Vietnam

Despite of a half-year difficulty, Vietnam real estate market is now considered a long term potential market as foreign investors are keen on developing more projects. From the picture of real estate development in 2008, it showed that all trading in this sector are almost frozen, together with the increasing of interest from the banks and material prices, domestic investors are put in troubles. Meanwhile, foreign capital from the outside investors is continuously put in Vietnam’s real estate market with an impetuous speed.

Many foreign developers are still looking for opportunities to penetrate Vietnam's realty market, and many companies are now interested in HCM City's outskirts such as Thu Thiem and Cu Chi District. Developers are also keen-on complexes of apartments, offices and commercial centers, resorts, industrial parks and residential areas. These segments' supply and demand are not well matched. Consequently, if having visibility strategy such as focusing on target customer, paying attention on marketing and having ability to bring out a high quality product, then chance of success is a seeable thing.

According to Goetsch (2002) “Total Quality Management (TQM) is an approach to doing business that maximizes the competitiveness of an organization through continuous improvement of its products, services, people processes, and environment”. Kotler, 1999 noted that the foundation of TQM is satisfaction renders by products or services and products (or services) are nothing offered to a market for attention, acquisition, use or consumption that satisfy a want or need.

TQM is not a new concept in the manufacturing sector. However, it does not mean that management system which have worked well in the manufacturing sector can be directly well-applied to construction. This is due to the nature differences between the two sectors. Construction industry has its own unique feature while manufacturing calls for repeat processes with products primarily put out in large batches. On the other hand, construction work is undertaken in the main single batch or projects. Although many of the basic processes are repeated from job to job (e.g. concreting and plastering), the specifics of application are always changing (Low & Peh, 1996).

In construction industry, where customers’ requirements are increasingly complex and expectations are uncertain, the application of such tools becomes difficult. Vietnam’s Property market is now considered a complex and “hot” environment for investors. Hence, application of TQM will be a competitive advantage (Low & Peh, 1996). If TQM can be implemented into property development field in a right way, it can help to improve the quality as well as the productivity of the project. It is a need to identify suitable TQM factors that are applicable to these projects in order to take the best efficiency of implementation.

Ms. Nguyen Viet Nhan made a case study that focused on the property developing projects in Ho Chi Minh City to (1) find out TQM factors that are applicable to property developing projects; (2) find out the perception and practices of TQM in Vietnam property development; and (3) develop TQM framework that is applicable in Vietnam property development.

The results of her study clearly indicated that Leadership and commitment by top management is the most critical factor for the successful implementation of TQM in Vietnam property development organizations. Once it is known exactly where the organization is, the manager can take steps to improve the overall effectiveness of quality management system. This study also found out that the first five critical problems of TQM implementation are (1) Customer focus; (2) Relationship with supplier, contractor and subcontractor; (3) Leadership and commitment of top management; (4) Employee involvement and commitment; and (5) Education and training. These five priority factors should be given more attention in order to achieve a satisfactory level.
Her thesis abstract is copied and posted.

ABSTRACT
This study investigates the factors affecting successful implementation of TQM in property developments projects. The primary objectives of this study illustrate the development of TQM, introduce the common TQM model and evaluate the items in property development management's TQM model that are believed to be most successfully and most unsuccessfully implemented. In the later part of the study proposes a new TQM model that is applicable in Vietnam market. The result finding is expected to be powerful information for future research directions especially as an indicator for the development of a suitable TQM framework for the property development projects in Vietnam.

The survey was carried in Ho Chi Minh City and the suburban provinces of Ho Chi Minh City. 145 samples from medium-large scale projects were selected for the analysis. All respondent‟s results were analyzed using SPSS version 15.0. Theory using in this survey is grounded from literature review and expert‟s experience. There are twelve factors which affect successful TQM implementation were identified from the survey. The findings indicated that the most important element in TQM framework is Commitment and Leadership by Top Management. The others critical dimensions of TQM are Employee Involvement and Commitment, Education & Training, Communication to improve quality, Policy, System & Process, Customer focus, Relationship with supplier, contractor and subcontractor, Quality Audit & Evaluation, Improve jobsite quality, Work environment & Culture, Team working for, Continuous improvement, and Resource management. The findings also indicated that there was a difference on TQM perception between project manager and site engineer in some dimension of TQM. These are Customer focus, Quality Audit and evaluation, and Relationship with supplier, contractor and subcontractor. A gap the analysis was carried to examine the importance and actual status of these TQM factors. The results indicated that there are a big gap between actual practice and perception. The top five factors that have largest gaps were Customer focus, Relationship with supplier, contractor and subcontractor, Leadership and commitment of top management, Employee involvement and commitment, Education and training. Improving the satisfactory levels of these factors may lead to a successful TQM implementation. Finally, a framework for implementing TQM is recommended.