Seminar in Can Tho Vietnam 22 June 2009 part 1

Participants attending our seminar

Dr. Hadikusumo and Ms Bich Hoa (AITVN)

Mr Pham Hong Linh - General Director of SouthWest Gas Pipeline 700 Km

Dr Hadikusumo and Ms Bich Hoa made a presentation in Cantho.

I made a presentation about the roles of project management for project performance and organization. Then, I continued with explaining how to build project management competency in an organization.

In the seminar, Mr Pham Hong Linh - the General Director of SouthWest Pipeline 700 km, also attended the meeting and shared his experience on why project management is very important in large construction projects.

The seminar was attended by construction professionals from Cantho city and neighbouring area.

Posted by
Hadikusumo

RISK FACTORS INFLUENCING INTERNATIONAL CONSTRUCTION PROJECTS IN PAKISTAN

Construction is the second largest sector in Pakistan’s economy after agriculture. Roughly 30-35% of employment is directly or indirectly attached with the construction industry. In contrast to the prospective share of Pakistani construction in the local and global economic market, the development of the sector has not been at par with the market demands. Pakistan’s construction industry is still characterized as pressured and adversarial. Further, construction projects in Pakistan generally run over time and over budget; do not necessarily meet user expectations; and often require remedial works due to construction defects, with many conflicting issues, leading to project disputes and litigation.

Mr. Ahsem Maqsoom (M. Eng’g in CEIM) made a research to (1) understand the basic concepts involved in international construction business and their limitations; (2) study the reasons and characteristics for internationalization of firm; (3) study the problems and risks associated with international construction projects; (4) study the entry modes and formulation of healthy strategies for international construction business; (5) identify the risk factors influencing international construction projects in Pakistan

He found out that new opportunities are constantly growing as a result of globalization in construction sector. Construction firms want to have projects at international level. In every construction project, risks are present. Risks in international construction projects are more critical as compared to domestic projects especially when developing countries are involved. That’s why it is desirable for international construction firms who want to do construction projects in foreign country, to identify the risks as early as possible, so that suitable strategies can be made for the penetration in to the foreign construction market and to manage these risks before the actual execution of projects on international level.

Risk consequences in construction projects may reach an undesirable level because of inadequate resources and lack of advancements in technologies, therefore a thorough awareness and identification of risks is essential to prepare suitable strategies.

Mr. Maqsoom’s abstract is copied and posted.

Abstract

Globally construction companies are entering in an era of internationalization. This brings a need of developing and defining strategies to cope with the international demands of quality, risk and profit. Different models related to the international construction have been studied in context with the following issues.
• Globalization and construction industry development
• Characteristics of internationalization
• Risks or Obstacles associated with international Construction business
• Competitive advantage and strategies for international construction business

International construction projects have many risks involved due to the nature of their structure. There are more parties involved and more phases are present in international construction projects than a conventional construction project. Each party has its different objectives. This difference in the objectives of parties leads to conflict of interest which is a root cause of risks in international construction projects. An international construction adaption model has been developed in this research. This model had been applied on Pakistan construction industry to know the practical example of internationalization. The risks factors which influence the international construction business in Pakistan have been identified and then classified on country, construction industry and project bases. Some critical problems related to international construction projects have been indicated from these identified risks. Some recommendations have also been suggested to manage the critical risk for the success of international projects and development of international construction industry of Pakistan.

Quantitative Risk Assessment for Offshore Platform Process System

Oil and gas industry is one of sectors that have high risks. It can range from minor to major events. For instance: oil leaks, gas leaks resulting to catastrophes like explosions, fires and oil spread. These disasters might cause fatality, injury, pollution, economic loss and even disruption of business. How can these accidents be prevented? How can the level of risk be assessed? And how can these things be handled or managed?

Mr. Nguyen Van Thanh made a case study on “Quantitative Risk Assessment for the Process System on an Offshore Platform: A Case Study Of QRA For Process System Of Platfrom RP-3 Of J.V. Vietsovpetro”. This project is a partial requirement for his Professional Masters degree in Construction Engineering and Infrastructure Management.

He concluded that:
(1) to evaluate and calculate the level of risk of a project, a factory or an offshore platform, the general formula that can be used is: R = F x C (where : R = Risk ; F = Frequency and C = Consequence). Based on the formula of risk, reduction of the consequence and reduction of the frequency are the two ways to reduce the risk.

(2) to reduce the consequence or frequency of risk, mitigation measures will be proposed if the risk value is higher compared with the risk criteria. The process system should be divided into the segments based on the properties, functions and working place.

(3) to assess the risk, the process system of platform RP-3 (Vietsovpetro Joint Venture) was divided into 8 segments based on their function, working condition and location. Comparing to the risk acceptance, the calculated risk in the process system of platform RP-3 is lower. Therefore, the risks are acceptable.

Mr. Nguyen Van Thanh’s abstract is copied and posted.


ABSTRACT

Quantitative Risk Assessment is a mean of objectively measuring the risks from hazardous activities of a facility or operation. The risks are qualified in terms of their probability and consequences. By comparison with a suitable risk criterion, the results can be used to help decide whether the facility is unacceptable or whether the improvements are necessary
This thesis attempts to explore the existing approaches of Quantitative Risk Assessment and apply this technique to offshore oil and gas industry, a very high risk sector, by proposing a frame work to conduct quantitative risk assessment for process system of offshore platforms.
Based on the given frame work, a case study will be performed to understand the effectiveness of “Quantitative risk assessment for process system of PR-3 offshore platform in Dragon oil field of Vietsovpetro J.V”

Transformational Style: The Highly Effective Leadership Style in Thai Construction Industry

In Thailand, the construction industry grown quickly especially in the infrastructure sector since the demand of the population on infrastructure is increasing. Construction is a project based industry and its success depends on several factors including the manager’s personality traits, competencies or necessary skills, and leadership styles which are appropriate for dealing with construction work have high impact on project outcomes.

Ms. Kedsuda Limsila conducted a case study on “Effective Leadership In The Construction Industry In Thailand“. This was focused mainly on the influence of project managers’ leadership styles on outcomes and was conducted in order to identify the most appropriate leadership style in the Thai construction industry.

She found out that:(1) in general, project managers in Thai construction projects apply a variety of leadership styles, most often adopted is the transformational style, followed by the transactional style and the laissez-faire style; (2) the entire range of behaviors of transformational project managers and contingent reward behavior from the transactional style are capable of generating leadership effectiveness, subordinate satisfaction and extra effort while the other leadership behaviors cannot; (3) in Thai construction projects, subordinates with extroversion personality tend to produce greater work effectiveness and exert extra effort whereas subordinates with conscientiousness and/or openness to experience personality tend to be satisfied with and exert extra effort into their work; (4) several independent factors affect the decision making of project managers in the process of selecting the leadership styles to apply to their subordinates. The more the factors with positive relationships appear, the higher the likelihood that project managers will select those related leadership behaviors whereas the other factors with negative relationships have the opposite effect; (5) several factors that positively affect leadership outcomes (effectiveness, satisfaction, extra effort, and commitment). Some factors have association with only one outcome whereas other factors have associations with several outcomes. The higher the level of the relevant factors present, the higher the degree to which leadership outcomes will occur.

Her results pointed out that leadership style mostly adopted in Thai construction projects is the transformational style since this is the most effective leadership style to apply with Thai subordinates.

Her Ph.D. dissertation abstract is copied and posted.

ABSTRACT

The success of a construction project depends on several important factors, one of which is the competence of its project manager. There are several issues regarding the project manager have impacts on project outcomes. Examples include the project manager’s leadership behaviours, personal attributes, and competencies or necessary skills which are appropriate for dealing with construction work. Consequently, there are many questions need answers regarding the competence of project managers and issues of effective project management. For instance, what is the most applied leadership style at the current time and what are the different outcomes from applying different leadership styles? What is the most appropriate leadership style? What are the necessary competencies of an effective project manager?

Consequently, this study was conducted to investigate the actual leadership behaviours and personal competencies of project managers. It also explored the key personality traits of subordinates in Thai construction projects. Specifically, this study examined how leadership behaviours, leader personal competencies and subordinate personality traits influence leadership outcomes (effectiveness; satisfaction; extra effort; commitment) and subordinates’ work performance (work quality; work quantity; problem solving creativity; teamwork and work discipline).

Leadership behaviors and outcomes were measured using Bass and Avolio’s (2004) Multifactor Leadership Questionnaire (MLQ), subordinates’ personalities were measured following the Five Factor Model whereas project manager’s personal competencies were measured following the Project Manager Competency Development (PMCD) defined by Project Management Institute (2002). During the data collecting process, data regarding the actual leadership behaviours, leadership outcomes and personal competencies of project managers in Thai construction projects were gathered from subordinate group whereas project managers provided the data on their subordinates’ key personalities and work performance level based on their opinion.

The findings of this study answer several questions on the top of this page that leadership style mostly adopted in Thai construction projects is the transformational leadership style. It further clarifies that this style is suitable for application with Thai people since it created leadership outcomes superior to the other styles (transactional style and laissez-faire style). In addition, transformational leadership supports subordinates to produce better work quality and work quantity. Moreover, the subordinates also tend to have high creativity in problem solving when working with transformational leaders.

Besides, the association between PMCD personal competencies and MLQ leadership behaviours revealed that the entire personal competencies defined by Project Management Institute have significant positive relationship with every factor in the transformational style but they have significant positive relationship with only contingent reward factor in the transactional style whilst having negative relationship with the laissez-faire style. It implies that project managers who apply transformational behaviours are likely to possess the necessary personal competencies required for competent project managers also.

MPM and CEIM Photo in AIT Main Campus Thailand

Hi all, i am attaching a photo taken in April 2009 in AIT Main Campus Thailand.

Professional Master in Project Management in Construction and CEIM students took photo at the NEW landmark of AIT in front of our administration building.

Dean Prof. Worsak, Dr. Hadikusumo, Dr Therathorn (Adjunct Faculty from Perfect Property), Mr Mike Woodward (Adjunct Faculty from Foster Wheeler) were participating in the photo.

This is a photo to remember our Green Campus in AIT Thailand.

Posted by

Hadikusumo

NEGOTIATION ISSUES, STYLES AND OUTCOMES IN BUIDING CONSTRUCTION PROJECTS IN THAILAND

In construction industry, conflicts are inevitable in any construction projects.
Construction projects require that every parties are related in term of negotiation such project managers, safety managers, clients, suppliers, designers, site engineers, and consultants. Negotiation is one potential consequence to succeed projects when comparing with other factors. Many negotiators need to understand their personal characteristics for bargaining.

For any given issues, problem or conflict encountered, the participant has a negotiating position. Different construction projects have different conflict styles and different departments try to work together.

Mr. Surapong Panja made a case study on “Negotiation Issues, Styles, And Outcomes: A Study of Building Construction Projects in Thailand”. He learned that construction industry always has conflicts that can be attributes to more factors such as change order, variation work, job safety, price adjustment (inflation or deflation), and time extension. These factors can produce many conflicts itself and may contribute germination and manifestation. Dispute is always negotiated by project participants, and the process of negotiation is the first task before considering other resolution methods. The project manager of contractor tends to use avoiding style. It is suggested that it is more important for negotiation outcome to understand the proper negotiation style on each negotiation outcome in order to make beyond benefit to negotiation outcome with satisfaction.


His abstract is copied and posted here.


ABSTRACT

Negotiation is one potential process to make construction projects to succeed or fail. The negotiation between project participants is the first step to do businesses even construction industry, and it can take place all stages of construction projects. In negotiation process, the characters of project participants can affect to their behavior which can lead to resolve conflicts and outcome with satisfaction. Thus, the ability of project participants for negotiating effectively is a one essential success or failure. Weakness of negotiation can also affect to a sizable loss not only negotiator’s needs but also affect to other sides involve. Notwithstanding, understanding both the behavior of negotiation style, negotiation issues, and outcomes are valuable for practices and academics.

This study also emphasized on five aspects: (1) to study negotiation styles regarding with the project manager of consultant and contractor in the way they use negotiation styles. (2) To study what are important negotiation issues between the project manager of consultant and contractor those are important to both parties (contractors and consultants) and issues that are possible for value exchange in bidding and construction stage. (3) To find out the relationship between negotiation styles and negotiation outcomes. The questionnaire survey involved in thirty high-rises building projects.

Based on the results, the finding can suggest that different negotiation styles will affect to different negotiation outcomes, and what the negotiation style are appropriate with each negotiation outcome. The suitable negotiation style on negotiation outcome may be helpful to increase negotiation outcome. The understanding the strongest negotiation style can provide more beneficial as well as weakness styles can also provide drawback. Furthermore, the significant responsibility of project manager is to identify the important issues for one’s side, and another side may be less important issues which can apply to possible value exchange concept.

CORRELATION BETWEEN PERSONALITY AND JOB PERFORMANCE

People are now considered as one of the factors that sustain advantage in an increasing globally work oriented competition among organizations. Human Resources (HR) are appreciated as an asset to corporate success, among other factors because its functions cover a wide range of activities which are required for different skills.

Construction compared with other organizations has the highest degree of applying HR for all hierarchical levels and one of the largest global employment sectors, providing work for a significant proportion of the labor market and accounting for a significant share of the world gross domestic product.

Human Resources in a labor construction have many varieties; from top to bottom; comes from different backgrounds; and have various skills and diverse aptitudes that make difficulty in controlling them. Therefore, construction companies must have appropriate Human Resources Planning (HRP).

Ms. Swe Zin Myint conducted a case study in “The Relationships Between Personality and Job Performance in Myanmar Construction Projects”. The analysis result of his study shows that there are correlations between personality and job performance of respondents who work in construction sites. He found out that (1) conscientiousness and integrity play crucial role in managers’ personality trait because it is related with most of managers’ job performance categories by positive correlation. Therefore, in recruiting for manager’s position, the employers must check the applicants’ personality traits especially in conscientiousness (2) Organizational factors influence more than the personality factors level to job performance. Therefore, employers better manage HR in an effective way to get high performance from them. The employers can recruit employees by testing their personality required for the job and if the personality is not fit with the HR job position or job performance, employers can exert effort to increase it by providing organizational factors.

His thesis abstract is copied and posted.


ABSTRACT

In order to achieve the success, every organization has to metain their competitive strategy by modifying it according to rapidly growth of technology. There are many strategies to overwhelm competitors but all of them are based on human resources (HR). Consequently, one of the important factors to have proper human resource management is their personality traits. This study intends to investigate the relationship between personality and job performance of HR in construction to manage HR effectively by achieving high performance. A survey for the study was conducted in Yangon, the previous capital city of Myanmar and target on manager, site engineer and site supervisor of ongoing construction projects. The study indicated that not only correlation of personality and job performance but also fundamental personality traits for manager especially for human resource management. Moreover, it also compared the influential level of personality traits and organizational factors on job performance.