Proceedings of the

Fifth Scientific Conference on

Project Management (PM-05)

Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”

29-31May 2010
Moevenpick Resort & Thalasso Hotel,
Heraklion, Crete, Greece

Editor

John-Paris Pantouvakis

Coordinated by the
Centre for Construction Innovation (CCI)
Department of Construction Engineering & Management
Faculty of Civil Engineering, National Technical University of Athens (NTUA)
Athens, Greece

Organization & Secretariat

Frei SA Travel – Congress
Athens, Greece
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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

© 2010 by J.P. Pantouvakis, Centre for Construction Innovation, National Technical University of Athens.
Tel. +30-210 772 1268, Fax. +30-210 772 3781, email. [email protected]
All rights reserved. No part of these proceedings may be reproduced in any form, or by any means without
written permission from the editor.

The views expressed in the papers are of the individual authors. The editor is not liable to anyone for any loss or
damage caused by any error or omission in the papers, whether such error or omission is the result of negligence
or any other cause. All and all such liability is disclaimed.

The proceedings includes a CD attached on the back cover. The CD contains the conference abstracts, the full
versions of the papers and other related information. Adobe Acrobat Reader® is needed (can be installed
through the CD if not present in your system). No other special installation is required.

ISBN: 978-960-254-690-1

Athens, Greece.
May 2010

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

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Welcome to PM-05, the 5th Project Management (PM) Conference in the series that we have
been organizing in Greece since 2001. In designing PM-05 we have integrated our
experiences with most of your suggestions from previous PM conferences in order to
organize the best possible event for the professional, the academic, the researcher, the
student and their respective organizations.
In PM-05, our keynote speakers will set the scene for the subsequent conference sessions.
Brigitte Schaden, the President of IPMA (International Project Management Association) will
explain how IPMA moves forward and brings the benefits of project management to
professionals and organizations. Mirek Skibniewski, Professor at the University of Maryland,
USA will address the important technological issue of ERP integration in project
management. Roland Gareis, Professor at the Vienna University of Economics and Business
and Managing Director of RGC will provide a glance of his experience in designing project
and programme performing organizations. David Pells, the managing editor of PM-Forum,
will provide invaluable information on the origins, whereabouts and future aims of this very
important project management portal.
In addition, PM-05 as all previous Conferences in the series, will be based upon peer
reviewed papers. Academics, researchers, industrialists, professionals, policy makers and
assessors, concerned with projects and programmes in every sector (construction, IT &
telecommunications, public government, NGOs, international & EU funded projects etc)
contributed with their knowledge and experience. You will find some ninety papers in the
proceedings, authored by people originated from more than twenty countries in the five
continents. These papers summarize the efforts, developments, knowledge and experiences
of a wide spectrum of individuals and organizations from around the world. You will find
both academic papers and professional presentations in the proceedings. PM-05 embraced
both academia/research and practice/profession and more importantly aimed at the
interaction of the two “worlds”!
The PM-05 will also include tutorials on specific topics. The tutorials aim at highlighting,
informing and setting you thinking on important questions of relevance. For example, what
is an international professional organization, such as IPMA, is doing to advance project
management? What is the importance of project management certification and when and
why should one aim for being awarded a project management certificate? Can we view
project management differently so that it may deliver results in a decision-less
environment? Finally, what are the major challenges and opportunities for project
management (and project managers) in the next decade? Views, speculations, interaction
and (hopefully) answers will be found at these tutorials led by renowned experts, such as
the President of the IPMA, the Vice-President of IPMA for Certification, the Director of the
Performance Based Studies Research Group (PBSRG) at the Arizona State University and
the Vice President of the Association for Project Management (APM).
Equally, the PM-05 Conference is the ideal background to discuss the further advancement
of the discipline through research and development. A PhD Workshop, led by the Director of
Post Graduate Research Training at the 6-star rated University of Salford, UK will attempt to
provide invaluable information and guidance.
Are papers, presentations, tutorials and workshops enough for project management? I think
they are not. In managing a project, you need to make use of all information “generating”
sources and of all information transfer mechanisms that may include verbal
communications, interaction and tacit knowledge! How, for example, do you exactly capture
the philosophy, power and simplicity of “Bistamundi”? In this conference, you may find that
social events are particularly focusing on project managers and their respective personal
advancement needs that cannot be addressed through formal learning, reading and
attending of structured presentations. In addition, Crete, an island with rich history and
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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

unique cultural heritage forms an almost ideal setting for further personal development.
So, watch out for the social events of the Conference; they may be more interesting and
rewarding than you may have originally envisaged…
In all, we have set up a balanced Conference with both formal papers and structured
tutorials; you will gain a lot by attending the Conference and the parallel activities as we all
know that information is not always easily captured in printed materials.
I really hope that you will consider the event useful to your professional and research
careers and that you will find the time to discuss and exchange ideas on projects and
project management with your colleagues during the conference.
This event could have never been possible without the contribution of many people; the
organizer FREI SA, who looked after all organizational issues; the renowned invited
speakers who took the time and put the effort to address the event; the tutorials and
workshop chairs who contributed with their knowledge, acquaintances and skills; the
authors and the reviewers of the papers. Many supporters for their wishful thinking and
support. Appropriate acknowledgment should be made to all of the above. However, I must
reserve my most heart-felt appreciation for you, the conference participants who made the
whole venture possible and worthwhile. Thank you!
And if you enjoy PM-05, please have in mind that we may have even bigger and better
plans for the future! The next conference in the series, PM-06 will be held in Athens, in early
November 2012 in conjunction (hopefully) with the 26th IPMA World Congress. We really
hope that you will book the first week in November of 2012 for a most exciting and
rewarding project management event!
With best regards and wishes for a successful Conference in Heraklion, Crete and the future,

John-Paris Pantouvakis, Ph.D.

PM-05 Conference Chair,
Centre for Construction Innovation,
National Technical University of Athens
PM-Greece Association - An IPMA Member.

http://paris.pantouvakis.gr

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

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Foreword…………………………………………………………………………………………………………………………………. 3
Contents at a glance………………………………………………………………………………………………………………… 5
PM-05 > Conference Reviewers ………………………………………………………………………………….………….. 6
PM-05 > Cooperating Journals ………………………………………………………………………………….………….. 7
PM-05 > List of Conference Papers ………………………………………………………………………………………. 8

Keynote Lectures 12

Keynote Lecture 1: IPMA Moving Forward …

Brigitte Schaden…………………………………………………………………………………………………………………… 13

Keynote Lecture 2: PM Forum : The Untold Story

David Pells …………………………………………………………………………………………………………………………. 13

Keynote Lecture 3: Designing Project & Programme Organizations

Roland Gareis………………………………………………………………………………………………………………………… 14

Keynote Lecture 4: Enterprise Resource Planning System for Project-Based Firms:

Costs,Benefits & Implementation Challenges
Mirek Skibniewski …………………………………………………………………………………………………………………. 14

Abstracts 15

Conference Papers (CD only) 43

PM-05 > List of Participants (CD only) 825

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

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PM-05 Advisory Committee

Ipsilandis, P., ΤΕΙ Larissa, Greece

Kagioglou, M., University of Salford, UK
Kirytopoulos, K., University of the Aegean, Greece
Panagiotakopoulos, D., Democritus University of Thrace, Greece

PM-05 International Scientific Committee

Abdel-Razek, R., Arabian Gulf University, Bahrain

Arslan, G., Anadolu University, Turkey
Azhar, S., Auburn University, USA
Birgonul, T., Middle East Technical University, Turkey
Brilakis, I., Georgia Institute of Techn., USA
Chassiakos, A., University of Patras, Greece
Christodoulou, S., University of Cyprus, Cyprus
Edum-Fotwe, F.T., Loughborough University, UK
El-Dash, K., College of Technological Studies, Kuwait
Emiris, D., University of Piraeus, Greece
Kashiwagi, D., Arizona State University, USA
Lambropoulos. S., National Technical University of Athens, Greece
Langford, D., Glasgow Caledonian University, UK
Manoliadis, O., Democritus University of Thrace, Greece
Oral, E., Cukurova University, Turkey
Pells, D., Editor PM Forum, USA
Polat, G., Istanbul Technical University, Turkey
Radujkovic, M., University of Zagreb, Croatia
Shannon, D., Oxford Project Management Limited, UK
Shepherd, M.M., University College London, UK
Taylor, T., Buro Four, dashsot, Vice President of APM, UK
Xenidis, Y., Aristotle University of Thessaloniki, Greece
Zavrski, I., University of Zagreb, Croatia
Zuchi, D., Roland Gareis Consulting, Austria

PM-05 Additional Conference Reviewers

Aretoulis, G., Aristotle University of Thessaloniki, Greece

Domljan, I., University of Mostar, Bosnia & Herzegovina
Fidan, G., Middle East Technical University, Turkey
Fragkakis, N., National Technical University of Athens, Greece
Kapogiannis, G., University of Salford, UK
Maravas, A., National Technical University of Athens, Greece
Marinelli, M., National Technical University of Athens, Greece
Metallinos, P., Engineering Dept., Region of Ionia Nisia, Greece
Panas, A., National Technical University of Athens, Greece

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

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The following journals will publish selected papers from the PM-05 Conferece:

1. Automation in Construction, Elsevier, Editor in Chief: Professor Miroslaw

SKIBNIEWSKI, Univesity of Maryland, U.S.A.

2. International Journal of Construction Project Management (Vol. 3, Issue 1,

March 2011), Nova Publishers, Special issue Editor : Dr. Yiannis XENIDIS, Aristotle
University of Thessaloniki, Greece.

3. International Journal of Project Organisation and Management (Vol. 4, Issue

2, March 2011), Inderscience Publishers, Special issue Editor : Dr. Kleanthis
SIRAKOULIS, Lecturer, Technological Education Institute of Larissa, Greece.

4. Built & Human Environment Review Journal, (International Journal dedicated to

postgraduate research), Open Journal Systems, University of Salford, Guest Editor:
Dr. Monty SUTRISNA, University of Salford, UK.

5. PM World Tomorrow Journal, www.pmforum.org, Editor : Professor Dean

KASHIWAGI, Arizona State University, USA.

6. International Journal of Information Technology Project Management, IGI

Global, Special Issue Editors: Prof. Pandelis IPSILANDIS and Dr. Kleanthis
SIRAKOULIS, Technological Education Institute of Larissa, Greece.

7. Russian Project & Programme Management Journal, Grebennikov, Guest Editor :

Alexander TOVB, SOVNET & IPMA VP Certification.

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

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PAPER
CODE
AUTHOR(S) PAPER TITLE COUNTRY PAGE

AA094 ADAMANDIDOU E., XENIDIS I., CRITICAL REVIEW OF THE CURRENT PUBLIC-PRIVATE- GREECE 16 44
PAPAIOANNOU P. PARTNERSHIPS LEGAL FRAMEWORK IN GREECE WITH
RESPECT TO LEGAL RISKS MANAGEMENT
AA055 AGYAKWA BAAH A., CHILESHE A RISK ASSESSMENT AND MANAGEMENT FRAMEWORK UK 16 52
N., STEPHENSON P. TO SUPPORT PROJECT DELIVERY
AA086 AGYAKWA BAAH A.B., CRITICAL SUCCESS FACTORS FOR RISK ASSESSMENT UK 16 60
CHILESHE N., AND MANAGEMENT PROCESSES IMPLEMENTATION:
STEPHENSON P. PERCEPTIONS OF CONSTRUCTION PROFESSIONALS IN
GHANA
AA080 ALDAGHI S., ANOP S. MANAGEMENT OF COMMUNICATION RISKS :EVIDENCE SWEDEN 17 68
FROM INTERNATIONAL PROJECTS CASE STUDY
W010 AL-RASHDI, A., SUTRISNA, M. EVALUATION OF THE STANDARDISED FORM OF UK 17 76
CONTRACT AT THE SULTANATE OF OMAN
AA037 ANTONIADIS D.N., EDUM- FRAMEWORK FOR MANAGING COMPLEXITY OF UK 17 83
FOTWE F., THORPE A. INTERCONNECTIONS IN PROJECTS
AA058 ARETOULIS G., ARETOULI E., PROJECT MANAGERS AND DESIGNERS: REQUIRED OR GREECE 18 91
XENIDIS Y., STRIAGKA F., ENABLING COGNITIVE SKILLS AND PERSONALITY
KALFAKAKOU G. CHARACTERISTICS
AA077 ARMSTRONG S. MODELLING AS A SOFT SKILL FOR THE ASSEMBLY AND UK 18 99
USAGE OF A PROJECT COMPENDIUM VIA SENSEMAKING
CONCEPTS AND ITS SOFTWARE APPLICATION
AA097 BADGER W., WIEZEL A., CONSTRUCTION SUPERINTENDENTS NEED LEADERSHIP USA 18 107
ADAMS D., BOPP, P..
AA119 BALTAS, M., BALTAS, S. APPLICATION OF THE IPMA PROJECT HANBOOK ON A GREECE --- 115
CONSTRUCTION PROJECT IN ROMANIA. IMPLICATIONS
FOR THE COMPANY’S ISO 9001 SYSTEM
AA012 BELLOS E., VOULGARIDOU D., AN MCDA APPROACH FOR PROJECT SELECTION IN GREECE 19 117
KIRYTOPOULOS K., PUBLIC SECTOR
PANOPOULOS D.
AA007 BRAS I. MEASURING PERFORMANCE AND IMPLEMENTING GREECE 19 125
IMPROVEMENTS (CASE STUDY).
AA002 CARTER A., CHINYIO E. EFFECTIVENESS OF RISK MANAGEMENT: BARRIERS AND UK 19 135
SOLUTIONS
AA015 CHAN D.W.M., CHAN A.P.C., A RESEARCH FRAMEWORK FOR DEVELOPING A HONG 20 144
LAM P.T.I., YEUNG J.F.Y., PERFORMANCE EVALUATION MODEL FOR TARGET COST KONG
CHAN J.H.L. CONTRACTS IN CONSTRUCTION
AA104 CHILD G., SULLIVAN DELIVERING THE DESIGN SERVICES AND OTHER USA 20 152
K.,KASHIWAGI D. PROFESSIONAL SERVICES
AA038 CORBETT P., WRIGHT J. DOES THE USE OF PARTNERING LEAD TO IMPROVED UK 20 160
PROJECT PERFORMANCE?
W003 DAWOOD, I. , DECISION SUPPORT SYSTEM (DSS): A STRATEGIC TOOL UK 21 168
UNDERWOOD, J. FOR THE AFFORDABLE HOUSING INDUSTRY
W004 DAWOOD, I. , RESEARCH METHODOLOGY EXPLAINED UK 21 177
UNDERWOOD, J.
AA113 DUNOVIĆ, C., UREMOVIĆ, B., FIRST FIVE YEARS OF CONDUCTING THE MANAGEMENT CROATIA 22 187
ŠOJAT, D. IN CIVIL ENGINEERING GROUP OF COURSES WITHIN THE
PROFESSIONAL STUDY PROGRAMME AND THE
POLYTECHNIC GRADUATE PROFESSIONAL STUDY
PROGRAMME ON THE POLYTECHNIC OF ZAGREB
AA093 EDRISI S., BAJRACHARYA A. GENERATION OF REWORK:AN ORGANISATION’S UAE 22 196
PERSPECTIVE

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

PAPER
CODE
AUTHOR(S) PAPER TITLE COUNTRY PAGE

AA010 FRAGKAKIS N., A COMPUTER-AIDED CONCEPTUAL COST ESTIMATING GREECE 22 203

LAMBROPOULOS S., SYSTEM FOR PRESTRESSED CONCRETE ROAD BRIDGES
PANTOUVAKIS J.P.
AA074 GALARAS K., IMPLEMENTATION OF THE ENTROPY CONCEPT ON GREECE 23 211
CHRISTODOULOU S., TEZIAS CONSTRUCTION PROJECTS UNDER FINANCIAL
E.S. CONSTRAINTS
INV-3 GAREIS, R. DESIGNING PROJECT & PROGRAMME ORGANIZATIONS AUSTRIA --- 219
W002 GASA B., WINSTON S. THE USE OF THE CONSTRUCTION REGISTERS TO SOUTH 23 241
IMPROVE THE COMPETITIVENESS OF SMALL, MEDIUM & AFRICA
MICRO ENTERPRISE CONTRACTORS
AA048 GEORGIOU L., A REVIEW OF SPATIAL CONSIDERATIONS IN PROJECT GREECE 23 249
PANTOUVAKIS J.P., XENIDIS J. SCHEDULING
AA022 GEORGIOU L., VARANOU E., VISUALIZING TIME: A GIS APPROACH GREECE 24 257
PANTOUVAKIS J.P.
AA041 GIANNOPOULOU M.T., CONCEPTUAL MODELING OF CAUSE AND EFFECT GREECE 24 264
EMIRIS D.M. RELATIONSHIPS AMONG CRISIS ELEMENTS IN PROJECTS
USING FUZZY COGNITIVE MAPS
AA032 HANNA A.S., SWANSON J. TWO-PARTY RISK ASSESSMENT AND ALLOCATION USA 24 272
MODEL
ITPM1 IATROPOULOS, TH. THE USEOF PROJECT MANAGEMENT SYSTEMS IN ROAD GREECE 25 280
CONSTRUCTION PROJECTS: THE CASE OF THE EGNATIA
MOTORWAY
W008 ISHWERF, A., EATON, D. ABSENCE OF CORPORATE ENVIRONMENTAL UK 25 303
DISCLOSURE (CED) IN LIBYA: A RESEARCH NOTE
AA082 KALYVIOTIS N., KITSIOS D., CONSTRUCTION CONTRACTS, PROJECT DELIVERY GREECE 25 312
NANIOPOULOS A. METHODS AND ROLES OF THE PROJECT
STAKEHOLDERS.
THE CASE OF KHALIFA PORT PROJECT IN ABU DHABI.
AA102 KASHIWAGI D., SAVICKY J., THE DECISION-LESS ENVIRONMENT OF THE FUTURE PM USA 26 320
SULLIVAN K.
AA103 KASHIWAGI J., SULLIVAN K., NEW CONTRACT MODEL FOR PROJECT MANAGEMENT USA 26 328
KASHIWAGI D.
AA105 KASHIWAGI J., SULLIVAN K., STRATEGIC PLAN FOR THE IMPLEMENTATION OF A NEW USA 26 336
KASHIWAGI D. PM MODEL
W009 KASSIM, Y., EVALUATING IT AS A SOURCE OF COMPETITIVE UK 27 344
UNDERWOOD, J. ADVANTAGE IN ENGINEERING AND CONSTRUCTION
ORGANISATIONS
AA112 KATSARELIS, T, PROMETHEUS CONSTRUCT:A SOCIETAL AND GREECE 27 352
ADAMOPOULOU, I. ENVIRONMENTAL RESPONSIBILITY FRAMEWORK FOR
MEDIUM,SMALL AND VERY SMALL CONSTRUCTION
COMPANIES
NGO1 KATSARELIS, T., GUIDELINES AND PROJECT MANAGEMENT HANDBOOK GREECE 27 360
DEPOUNTIS, N., FOR GREEK NON GOVERNMENTAL ORGANIZATIONS
ADAMOPOULOU, I. (NGOs)

ΑΑ064 KIRYTOPOULOS K., REENGINEERING PROJECT SCHEDULING WITH GREECE 28 368

STAVROU V., ROKOU, E. KNOWLEDGE MANAGEMENT
AA040 KONTOSTAVLAKIS D., PM-PEDIA: AN OPEN-LEARNING, EXPERT-BASED, MIND- GREECE 28 376
EMIRIS D.M. MAPPING TOOL FOR PROJECT MANAGEMENT
EDUCATION
SPM01 LAOUTARIS, P. LESSONS LEARNED FROM THE DEVELOPMENT OF A GREECE 28 384
PROJECT MANAGEMENT SUITE
AA054 LOUKAS P., CHASSIAKOS A. COMPARATIVE EVALUATION OF PROJECT MANAGEMENT GREECE 29 395
STANDARDS
AA067 MALISIOVAS A. CONSTRUCTION PRODUCTIVITY :FROM MEASUREMENT USA 29 403
TO IMPROVEMENT

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

PAPER
CODE
AUTHOR(S) PAPER TITLE COUNTRY PAGE

W005 MALISIOVAS, A. STUDENT DIFFICULTIES IN CONDUCTING PHD LEVEL GREECE 29 411

RESEARCH: THE ARISTOTLE UNIVERSITY OF
THESSALONIKI CASE STUDY
W006 MALISIOVAS, A. THE DIFFICULTY OF INTRODUCING THE MAIN SUBJECT GREECE 30 419
OF A PHD RESEARCH
AA020 MANOLIADIS O., VATALIS K. ASSESSING THE PROCUREMENT PROCESS IN GREECE’S GREECE 30 426
CONSTRUCTION PROJECTS.
W011 MARAVAS, A. A MULTI-FACETED APPROACH TO CONSTRUCTION GREECE 30 434
PANTOUVAKIS, J.P. , SCHEDULLING RESEARCH
AA117 MARAVAS, A., PANTOUVAKIS, UNCERTAINTY IN SCHEDULING MULTIPLE PROJECTS GREECE 30 442
J.P. LAMBROPOULOS, S.
ITPM4 MARAVAS, A., AN INTEGRATED INFORMATION SYSTEM FOR GREECE 31 451
MONITORING CONSTRUCTION WORKS
AA046 MARINELLI M., PREDICTION OF EARTHMOVING TRUCKS GREECE 31 464
LAMBROPOULOS S., DETERIORATION USING DISCRIMINANT ANALYSIS
PANTOUVAKIS J.P.
SPM02 MARKOULIDIS, P., AN INTEGRATED APPROACH TO GREECE 31 472
KOUTSOMICHALIS, A., MONITORING/PERFORMANCE ASSESSMENT OF
KLOUDAS, K. OPERATIONAL PROGRAMMES CO-FINANCED BY THE
EUROPEAN UNION
AA075 MASROM A.N., SKITMORE M. A NEW APPROACH TO ASSESSING MALAYSIAN AUSTRALIA 32 483
CONTRACTOR SATISFACTION LEVELS
AA111 MLINARIĆ, V., SIGMUND, Z., LOW ENERGY AND PASSIVE HOUSING STANDARDS IN CROATIA 32 491
TROJAK, S. EUROPE
PRC1 MOUTSOPOULOU, A., MODELLING WITH UNCERTAINTY FOR CONTROL TASKS GREECE 32 499
STAVROULAKIS, G.,
POULIEZOS, A.
AA014 OLATOYE C. THE RELATIONSHIP BETWEEN CONSTRUCTION UK 33 507
CONFLICTS ARISING BETWEEN OIL COMPANIES AND
POVERTY OF HOST- COMMUNITIES IN NIGER- DELTA
REGION OF NIGERIA
AA118 PANAGIOTAKOPOULOS, D. THE SUSTAINABILITY DIMENSION IN IPMA COMPETENCE GREECE 33 511
BASELINE CONTEXTUAL ELEMENTS AT PROJECT AND
PROGRAMME LEVELS
AA052 PANAS A., PANTOUVAKIS J.P., THE ROLE OF HEALTH, SAFETY AND GREEN PRINCIPLES GREECE 33 519
LAMBROPOULOS, S. IN ESTIMATING CONSTRUCTION PRODUCTIVITY: AN
EMPIRICAL FRAMEWORK
W012 PANAS, A., PANTOUVAKIS, J.P. A CRITICAL REVIEW OF PUBLISHED RESEARCH ON GREECE 34 527
CONSTRUCTION PRODUCTIVITY
AA044 PAPADAKI M., GALE M., FACTORS INFLUENCING PROJECT RISK MANAGEMENT UK 34 536
RIMMER J., KIRKHAM R. DECISION MAKING
AA121 PAPADOPOULOS, TH., COLLABORATION PROCUREMENT METHODS IN GREECE 34 545
PANTOUVAKIS, J.P. CONSTRUCTION PROJECTS
AA045 PAPARI, E., A FRAMEWORK FOR THE IMPLEMENTATION OF A GREECE 35 552
PANTOUVAKIS J.P., PANAS, A. KNOWLEDGE MANAGEMENT PLATFORM IN THE GREEK
CONSTRUCTION INDUSTRY
AA033 PARK M.W., KOCH C., CORRELATING MULTIPLE 2D VISION TRACKERS FOR 3D USA 35 560
BRILAKIS I. OBJECT TRACKING ON CONSTRUCTION SITES
AA083 PARTHENOPOULOS N., WORKING CULTURES AND HUMAN RESOURCES IN THE GREECE 36 568
STAVROULIS S., CONSTRUCTION INDUSTRY OF THE BALKAN PENINSULA
NANIOPOULOS A.
INV-4 PELLS, D. PMFORUM – THE UNTOLD STORY! USA - 577
W001 PERERA, N., SUTRISNA, M. RESEARCH METHODOLOGICAL POSITION FOR A UK 36 601
DOCTORAL STUDY ON “APPORTIONING LIABILITY IN
DELAY CLAIMS”
AA011 POLAT G., MERT D. FACTORS AFFECTING COST CONTINGENCY IN TURKEY 36 609
INTERNATIONAL PROJECTS

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

PAPER
CODE
AUTHOR(S) PAPER TITLE COUNTRY PAGE

AA070 ROHRBORN D., MICROBLOGGING IN PROJECT MANAGEMENT: GERMANY 36 618

BOHRINGER M. IMPROVING PROJECT COMMUNICATION AND
DOCUMENTATION WITH STATUS INFORMATION
AA076 SADKOV, D., TOVB, A., CONSULTING COMPANY PRACTICE IN PROVIDING OF RUSSIA 37 626
TSIPES, G. PROJECT MANAGEMENT SPECIALISTS BY MASTERS
EDUCATION PROGRAM
INV-1 SCHADEN, B. IPMA MOVING FORWARD … AUSTRIA --- 634
ΑΑ063 SHANNON D. LIMITS TO PROFESSIONAL PROJECT MANAGEMENT UK 37 659
AA016 SHARAFI Z., HAGHNAZAR CLIENT’S CRITICAL SUCCESS FACTORS IN IRAN 37 667
M.A., SEPEHRI M. OUTSOURCING OF CONSTRUCTION PROJECTS CASE
STUDY: IRAN POWER PLANT PROJECTS MANAGEMENT
CO.
AA091 SHEPHERD M., BOWER D. PROJECT MANAGEMENT SOCIETIES AND PROFESSION UK 38 675
AA098 SKIBNIEWSKI M., ZENG Y. ENTERPRISE RESOURCE PLANNING SYSTEM FOR USA 38 687
PROJECT-BASED FIRMS:COSTS,BENEFITS &
IMPLEMENTATION CHALLENGES
AA116 SUTT, J., HANG, T., AASKIVI, U. STANDARDIZING OF STANDARDS IN IPM OF ESTONIA 38 698
CONSTRUCTION
W000 SUTRISNA, T. PhD RESEARCH METHODOLOGY UK -- 704
TAY-1 TAYLOR, T. GRASPING THE OPPORTUNITIES OF THE PM DECADE UK -- 717
AA073 TEZIAS E.S., RESOURCE-CONSTRAINED SCHEDULING OF GREECE 38 728
CHRISTODOULOU S., CONSTRUCTION PROJECTS AND SIMULATION OF THE
GALARAS K.A. ENTROPY IMPACT ON THE DURATION AND THE COST OF
A PROJECT
AA056 TRIVELLAS P.G., SKILLS AND COMPETENCES OF PROJECT MANAGERS GREECE 39 735
DRIMOUSSIS C.
AA018 TSIMOPOULOU V. DEVELOPMENT AND PROTOTYPE APPLICATION OF AN NETHERLA 39 744
OIL SPILL RISK ANALYSIS IN A COASTAL ZONE NDS
AA013 TZAVEAS TH., ANALYSIS OF PROJECT PERFORMANCE OF A REAL CASE GREECE 39 752
KATSAVOUNIS S., STUDY AND ASSESSMENT OF EARNED VALUE AND
KALFAKAKOU G. EARNED SCHEDULE TECHNIQUES FOR THE PREDICTION
OF PROJECT COMPLETION DATE
NGO3 VASILIADIS, A., SOCIAL ECONOMY AND CERTIFICATION IN THE CONTEXT GREECE 40 760
CHRISTODOULOPOULOU,G., OF THE EQF
LEONTARAKI, I.
AA023 VUKOMANOVIC M., KARARIC PREDICTING COST OF PREFABRICATED HOUSING USING CROATIA 40 768
M., RADUJKOVIC M. NEURAL NETWORKS
AA100 WIRKUS M. INFORMAL PROJECTS MANAGEMENT WITH VOLUNTEERS POLAND 40 776
PARTICIPATION
AA028 XENIDIS I., ANASTASIOU M., THE GREEK LEGAL FRAMEWORK ON OCCUPATIONAL GREECE 41 784
MAGGOS S. DISEASES IN CONSTRUCTION: CONFORMITY TO RISK
MANAGEMENT STANDARD
AA030 YUAN Q., POLYCHRONAKIS Y. THE DEVELOPMENT OF A ROBUST RESOURCE UK 41 792
CONSTRAINED PROJECT SCHEDULING FRAMEWORK
AA114 ZAPOUNIDIS K.C., PLANNING,IMPLEMENTING AND MANAGING ENERGY GREECE 41 801
PARTSALIDOU B., FERČEJ, D., EFFICIENCY PROJECTS AT FOCUSED LOCAL LEVEL:THE
PRISLAN, A. RURASU PROJECT SUCCESSFUL EXAMPLE AND THE
SAVE-AGE PROJECT OBJECTIVES
AA095 ZAPOUNIDIS, K., REFORMATION OF LOCAL DEVELOPMENT AGENCIES GREECE 42 809
PARTSALIDOU, B., SEEKING THEIR CONSERVATION IN THEIR WIDER
KALFAKAKOU, G. MARKET
AA079 ZUCHI D. PROJECTS FOR THE DESIGN OF CHANGES AUSTRIA 42 817

* Papers in Gray are professional presentations (Full paper has not been reviewed).

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Fifth Scientific Conference on

Project Management (PM-05)
Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”

29-31May 2010
Moevenpick Resort & Thalasso Hotel,
Heraklion, Crete, Greece

Keynote Speakers

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Short presentation of the Conference Keynote Speakers

Mag. Brigitte Schaden

President, International Project Management Association (IPMA)

Managing Director BSConsulting, President of IPMA, International

Assessor of IPMA, Chairman of Project Management Austria, Assessor
of the Certification Body of PM Austria, First Assessor of the
Certification Bodies in Romania & Greece
Degrees on Insurance Mathematics, University of Technology, Vienna,
Computer Technology, University of Vienna, IPMA Level B.
Worked in IT in bank, insurance and international trading companies.
Manager of Libro AG and Lion.cc Libro Online AG. Member of the
Certification Validation Board of IPMA & Past Vice president
(certification) of IPMA

IPMA .... moving forward

• Introducing IPMA (Mission, Historical Background, Membership, Excellence Awards, Events (World Congress),
Research & Publications, Certification and Standards)
• The profession – project management certification. How the IPMA Certification system supports quality
• Top trends in project management, IPMA achievements and new developments

David L. Pells
Managing Editor PM World Today, PMForum, Inc., U.S.A.

Managing Editor of PM World Today and of www.pmforum.org, one of

the world’s leading online sources of project management news. He is
an internationally recognized leader in the field of professional project
management, with over thirty years’ experience in project
management. His professional experience includes a wide variety of
programs and projects, including engineering, construction, transit,
defense and high technology, and project sizes ranging from small to
mega. He advises several major organizations and programs. He
served on the board of directors of the Project Management Institute
(PMI®) twice, and was awarded PMI’s Person of the Year award in
1998 and Fellow Award in 1999. He is also an honorary Fellow of
Project Management Associates (PMA), the Indian National PM society,
and of the Russian Project Management Association SOVNET. He has
published and spoken widely on Project Management worldwide

PMForum - The Untold Story..."

Launched by PM visionary David Curling in Canada in the early 1990s, www.pmforum.org is the world’s first and
oldest website devoted to professional project management. It remains one of the world’s best known and most
popular sources of project management news and information. With global networks of academic and professional
advisors, international correspondents, authors, ambassadors and readers, This presentation will tell the PMForum
story – where it came from, how it is evolving and what the future holds. PMForum bridges the professional worlds of
AIPM, APM, IPMA, PMAJ, PMI, SOVNET and other professional bodies, providing a global perspective on the state
of the project management profession, current trends and the likely future. PMForum’s mission remains “connecting
the world of project management”. This presentation will tell the story and reveal how that is possible.

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Professor Roland Gareis

Vienna University of Economics & Roland Gareis Consulting, Austria

• Managing Director of Roland Gareis Consulting GmbH Vienna and

Roland Gareis Consulting srl Bukarest

• Professor for project management, Vienna University of Economics

and Business Administration Projekt-Management Group.

• Academic Director Professional MBA Project & Process Management,

Vienna University of Economics and Business Administration.

Designing Project & Programme Organizations

• Projects (and programmes) can be perceived as comprehensive tasks, as temporary organizations, or as social
systems. The perception of projects influences the way how projects are managed, how their complexity is coped
with. A systemic-constructivistic project management approach will be presented. The consequences for
designing project organization charts, project roles, project communication structures will be shown.
• New organizational models for projects such as empowerment are introduced to optimize project performance.
• Specifics regarding the design of programme organizations are the relationships between the project owners,
project managers and the programme owner and the programme manager, the responsibilities of the programme
office, programme team meetings etc.

Professor Miroslaw Skibniewski

A. James Clark Chair Professor, University of Maryland, U.S.A.
Department of Civil and Environmental Engineering at the University of
Maryland. Prior faculty member at Purdue University. M.Eng. from
Warsaw University of Technology, and M.S. and Ph.D. from Carnegie-
Mellon University. Prior to his academic career, he worked in the
industry as an engineer engaged in design quality reviews, construction
related claims, value engineering, forensic engineering and industrial
safety investigations.
He has received many awards including the NSF Presidential Young
Investigator Award from President Ronald Reagan (1986), Honorary
Professorship from Warsaw University of Technology (2005) and
Moscow State Industrial University (2006). He is also a Foreign Member
of the Russian Academy of Engineering. He is an author or co-author of
over 150 technical publications and of more than 100 invited research
presentations worldwide.

ERP Systems for Project-Based Firms: Costs, Benefits & Implementation Challenges

Enterprise Resource Planning (ERP) systems are configurable enterprise-wide information system services that
integrate information and information-based processes within and across functional areas in an organization. They
have been widely adopted in many organizations. This paper analyzes and presents the costs and benefits of ERP
systems for project-based industries, which have lagged behind other major industries in adopting ERP systems due
to their project-centric nature and the high stakes involved in ERP implementation. The challenges during the
process of ERP implementations are also identified as part of the effort to understand the implied costs of an ERP
system. The evidence of the costs and benefits is drawn from previous studies and the analysis of the prevailing
working practices in project-based firms. The classification of the costs and benefits can be used to enable
executives in project-based firms to make informed decisions on their ERP system investments.

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Fifth Scientific Conference on

Project Management (PM-05)
Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”

29-31 May 2010

Moevenpick Resort & Thalasso Hotel,
Heraklion, Crete, Greece

Abstracts

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

AA094 deviations from project plans and making construction

Critical Review of the Current Public-Private- projects particularly prone to risk. Despite the
Partnerships Legal Framework in Greece with extensive research on risk management in the
Respect to Legal Risks Management construction industry, there is limited literature dealing
specifically with project risk in developing countries. It
Elsa Adamantidou is against this background that this study investigates
(Legal Adviser of Public Procurement Monitoring Unit the use of risk assessment and management
Rechercher in Centre of International and European processes in organisations. Data were collected from
Economic Law, Greece) construction professionals working with construction
clients (both private and public), consultants, and
Yiannis Xenidis contractor organisations within the Ghanaian
(Lecturer, Aristotle University of Thessaloniki, Dept of construction sector. The survey data were used to
Civil Engineering, Greece) examine the differences in the levels of agreement
between the three stakeholders. The research
Panos Papaioannou findings indicated that although project stakeholders
(Professor, Aristotle University of Thessaloniki, Dept of are aware of risk factors associated with construction
Civil Engineering, Greece) projects, there is a need for the benefits of using risk
management processes to be emphasised and
Abstract communicated. Based on the research findings a risk
Success of Public Private Partnerships (PPPs) heavily assessment and management framework was
depends on the host country’s legal and regulatory established to support future successful delivery of
framework. Legal risks are primarily connected to construction projects in developing countries.
inefficiencies of legal agreements and documents and
lack of specific and clear provisions and regulations. AA086
This paper presents an inventory of legal risks based Critical Success Factors for Risk Assessment and
on literature review and compares it to the current Management Processes Implementation:
legal framework for PPPs in Greece aiming at Perceptions of Construction Professionals in
highlighting the latter’s strengths and weaknesses with Ghana
regard to the management of risks. The results of the
analysis indicate several strengths of the current legal Agyakwa-Baah, A.
framework, while the major weaknesses are the (Postgraduate, Sheffield Hallam University, Sheffield,
vagueness in certain cases, which allows for various United Kingdom)
interpretations and the negligence in the enforcement
of laws and regulations. Chileshe, N.
(Senior Lecturer, Research Education Portfolio Leader,
AA055 University of South Australia, Adelaide, Australia)
A Risk Assessment and Management Framework
to Support Project Delivery Stephenson, P.
(Professor, Sheffield Hallam University, Sheffield,
Agyakwa-Baah, A. B. United Kingdom)
(Postgraduate, Sheffield Hallam University, Sheffield,
United Kingdom) Abstract
Despite the extensive research on risk management in
Chileshe, N. the construction industry, there is limited literature
(Senior Lecturer, University of South Australia, dealing specifically with the identification of critical
Adelaide, Australia) success factors necessary for the deployment of risk
assessment and management processes in
Stephenson, P. developing countries. It is against this background
(Professor, Sheffield Hallam University, Sheffield, that this study attempts to elicit the perception of
United Kingdom) construction professionals on CSFs appertaining to
risk assessment and management processes within
Abstract the Ghanaian construction industry. Data was
Risk factors associated with construction projects have collected from 34 contractors, 46 consultants, and 23
a major impact on issues related to cost, time and clients (private and public) within the Ghanaian
quality of project delivery. Unexpected events result in construction industry. Response data was subjected to
either positive or negative outcomes often causing descriptive statistics and subsequently analysis of

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

variance (ANOVA) and other non-parametric tests For improving communication process in project
were used to examine the differences in the groups the dynamic nature of FIRO model should be
identification of the critical success factors. The considered. The risks will not be settled down unless
research findings indicated that among the critical the group stands in “Openness” stage and the group
success factors, ‘Management style’ and ‘team work development stage is vulnerable to any changes; the
and communications’ were ranked as the most environmental effects should be carefully followed for
important whereas ‘goals and objectives of the preventive action.
organisations’ and ‘customer requirements’ were
considered to be the least important. There was a W010
disparity of the ranking of the 10 critical success Evaluation of the Standardised form of contract at
factors among the groups; however the differences Sultanate of Oman
were not statistically significant. The study also
established a number of managerial implications in Aziz Al Rashdi
that the identified critical success factors could be (PhD Student, School of the Built Environment,
used as a ‘road map’ for the successful University of Salford, UK)
implementation of risk assessment and management
processes in developing countries. Monty Sutrisna
(Director of Post Graduate Research Training, School
AA080 of the Built Environment, University of Salford, UK)
Management of Communication Risks:
Evidence from international projects case study Abstract
The use of standardised forms of contracts has been
Shaghayegh Aldaghi generally considered practical and economical in the
(Royal Institute of Technology (KTH), Stockholm, construction industry. Originally produced in the 1980s,
Sweden) the standardised form of construction contract for
government works is the only standard contract
Sviatlana Anop document available and recognised for public works in
(Research engineer, Royal Instritute of Technology the Sultanate of Oman. In Oman, government
(KTH), Stockholm, Sweden) contracts for the construction of public works are
required by statuary law to be fixed-price contracts
Abstract awarded through competitive bidding. The
The realization of project requires collaboration standardised form of contract has never really been
between many different participants. The majority of reviewed and updated. Unfortunately, there is limited
interactions happen on the project management team research in the Omani construction industry
level. The general believe is that teams/groups can particularly in the contractual management field. Based
achieve more efficiency if they use effective on this, a PhD research has been set up intending to
instruments of risk management in their evaluate the use of the standardised form of
communication process. The aim of this study is to construction contract in Oman and to formulate
investigate how the level of communication risks varies recommendations of necessary improvement to
between different project group development stages incorporate the contemporary and future needs and
and how project manager can help project group to trends in the Omani construction industry. This paper
reach the maximum effectiveness of communication. discusses the background and rationale of conducting
The study analyzes different communication barriers the research followed by the research methodology
that project group meets while working at project. The applied in this study. The earlier stages findings are
investigation was performed by using qualitative also presented followed by discussion. The paper is
analysis method in four different projects of an concluded by summarising the progress and findings
engineering and consulting company involved with so far as well as the further stages of this research
mining industries in South Africa. Interpersonal guided by the findings.
relationships were measured by FIRO model and
communication risks were evaluated by a typical risk AA037
analysis method. Results of investigations show that Framework for Managing Complexity of
communication risks are directly affected by the stage Interconnections in Projects
of group development and different factors of group
development tend to synchronize with each other. The Dimitris N. Antoniadis
total amount of risks tends to decrease as group (Project Manager, Carillion Ltd, London, UK)
moves from one stage to another on the FIRO model.

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Francis T. Edum-Fotwe managers or as designers. Our hypothesis suggests

(Loughborough University, UK) that personality characteristics and cognitive abilities
could potentially function as prerequisites or enablers
Anthony Thorpe in a career path. Behavioural characteristics and skills
(Loughborough University, UK) are identified through a series of focus groups’
questionnaire surveys. Statistical analysis of the
Abstract answers highlight personality characteristics and
Interconnections and boundaries between the various cognitive abilities. The results are then compared to
project parties have been identified as an area which findings from literature. Finally, appropriate
requires careful consideration. Complexity is caused psychometric tests are proposed in order to quantify
by interconnections and this could lead to a reduction these characteristics and skills. This methodology
in performance if the resulting interface is not could standardize the selection procedures and
purposefully and efficiently managed. Understanding implement similar approaches in improving and
the characteristics of complexity of interconnections, managing human resources in Greek construction
and how these affect organising projects and the industry.
management style will enable the development and
implementation of innovative project actions and tools AA077
that will support the management of complexity Modelling as a Soft Skill for the Assembly and
through the respective processes. The authors Usage of a Project Compendium via Sensemaking
present results from a study of UK construction Concepts and its Software Application
organisations to shed more light on the influences of
complexity generated by the interconnections. The Steve Armstrong
results from the study have significant implications for (Lecturer, The Open University, Milton Keynes,
the way project teams are put together and managed, England)
and enabled the introduction of a framework for
managing complexity of interconnections in projects. Abstract
This paper takes a systems view in order to explore
AA058 and illustrate the relationships between the factors and
Project Managers and Designers: Required or actors that have an influence upon the course of action
Enabling Cognitive Skills and Personality as the project plan is realized. An understanding of the
Characteristics issues relating to a project’s risks, requirements and
resources is the basis for a successful implementation
Georgios N. Aretoulis of a plan to meet the time, cost and quality criteria. So,
(Res. Asst., Aristotle University, Thessaloniki, Greece) the ability to use qualitative models would be a
potential component in revising the competency
Eleni N. Aretouli baseline now that complexity has a greater influence
(Post-doctoral Fellow in Neuropsychology, The Johns on projects (e.g. performing project health checking).
Hopkins University, Baltimore,USA) From the recent set of case studies and interviews, it is
viewed that Project Compendium components can be
Yiannis Xenidis used to manage project knowledge effectively. They
(Lecturer, Aristotle University, Thessaloniki, Greece) help to ensure transparency, availability and
accessibility of information that is a potential
Fevronia Z. Striagka contribution to project success, assuming they have an
(Res. Asst., Aristotle University, Thessaloniki, Greece) adequate level of quality within the context.

Glykeria P. Kalfakakou AA097

(Professor, Aristotle University, Thessaloniki, Greece) Construction Superintendents need Leadership

Abstract William W. Badger

(Professor, Arizona State University, , USA)
This study is discussing the personality characteristics,
cognitive abilities and body of knowledge that Avi Wiezel
synthesize the profile of successful project managers (Associate Professor, Arizona State University, USA)
and designers. The paper determines the principal
characteristics and skills which enable engineers in the Daniel Adams
construction industry to excel either as project (Graduate Student, Arizona State University, USA)

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

conflicting criteria. Moreover they have to consider a

Peter Bopp much larger picture than private organisations and
(Retired, Dupont, USA) many scholars argue that public investment decisions
fall into the category of constrained optimisation
Abstract problems. The present study develops and proposes
This paper presents a method of profiling the an approach for the prioritization of public projects,
leadership skills of construction field superintendents based on the Analytic Network Process (ANP), which
and relating these skills to the success of their project. is further validated through a real case example
The leadership competencies of 43 superintendents concerning the project selection process of a Greek
were assessed utilizing a self-evaluation “Field municipality. The results indicate that social and
Construction Superintendent Questionnaire” (FCSQ) political criteria dominate the decision making process,
complemented by a “Project Manager Questionnaire” while the ANP documents the results in such way that
(PMQ) that provided an independent performance they can be communicated to various stakeholders,
evaluation from the superintendent’s project manager. ensuring public trust and establishing a system of
Analysis of the data collected from the FCSQ and the transparency in public administration.
PMQ shows significant correlation between the
leadership competency levels and the job performance AA007
levels of the Field Construction Superintendents. The Measuring Performance and Implementing
data collected allowed to asses the importance and Improvements (Case study)
need of leadership as well as management skills for
superintendents. Not surprisingly, the effectiveness of Ioannis Bras
management skills dominates the job performance of a (Managing Director, Superior Services, Greece)
construction superintendent but it is the degree of
applied leadership skills that make the difference Abstract
between average and exceptional performance (Great The period between 1999-2002 a first-hand applied
Superintendents). Participants were ranked based on research was based in one of the biggest corporations
their leadership scores. Interviews conducted with the in England (UK) in the Project Management field. The
participants’ company executives found a 90 percent target was to create the suitable tools, techniques and
accuracy rate in the ranking when compared to methodologies in a practical measurable environment
performance and profits generated by the participants. where departments of the company which affect the
effectivity and viability of a project to be analyzed so
AA012 that their effectiveness can be measured and ways
An MCDA Approach for Project Selection in Public and mechanisms of improvement can be found. It was
Sector decided that the start would be made from a project of
a budget of € 270 million whose cause was the
Evangelos Bellos research and construction of a nuclear laboratory in
(Researcher, National Technical Univ. of Athens, Shellafield UK. The department initially chosen to be
Greece) examined and ways of measuning effectiveness to be
found, but also methodology of optimizing the services
Dimitra Voulgaridou offered, was the Information Technology department
(R.A., University of the Aegean, Chios, Greece) since it offered its services to more than 400
engineers. The paper will cover the concept design,
Konstantinos Kirytopoulos the methodology and tools used as well as the results
(Assistant Professor, University of the Aegean, Chios, of the improvements acted out in the period of two
Greece) semesters when the research was held.

Dimitrios Panopoulos AA002

(Researcher, National Technical University of Athens, Effectiveness of Risk Management: Barriers and
Greece) Solutions

Abstract Andy Carter

Effective and efficient selection of projects is a crucial (Senior Consultant, EC Harris, Birmingham, UK)
issue for every organization and should be aligned
with its vision and strategies. The decision making Ezekiel Chinyio
process is highly complex, especially for public (Senior Lecturer, University of Wolverhampton,
organisations, as it encompasses various, often Wolverhampton,UK)

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

the Key Performance Index (KPIs) for TCC projects

Abstract and investigate their corresponding weightings. A
The effectiveness of risk management within the UK composite OPI will then be complied for evaluating the
construction industry is discussed. A semi-structured performance level of TCC construction projects.
questionnaire was used in collecting both qualitative Quantitative Indicators (QI) and Fuzzy Quantitative
and quantitative data. 113 construction professionals Ranges (QRs) pertinent to each KPI will be determined
were sampled who included project managers, clients, to minimise the subjective interpretation and value
quantity surveyors, and contract experts. 46 replies judgment to enhance the reliability and practicality of
were received, representing a 40% response rate. The the model. The proposed model is expected to be
quantitative data were analysed by descriptive developed into an online computerised system to
statistics while the qualitative data were synthesised enable industrial practitioners to measure, assess and
by the content-identification of opinions made. Results compare the performance levels of their own TCC
of the analyses showed that most respondents use a projects for benchmarking purposes.
structured approach; and manage risks throughout the
different phases of a project. They also feel that the AA104
risk management process is fairly okay but some Delivering the Design Services and Other
barriers were identified, e.g. making a late start, using Professional Services
inexperienced personnel, not fully pro-active, etc. In
view of these, solutions for improvement were Geoffrey S. Child
proffered such as providing adequate training, not (Professional Engineer, Sunrise Engineering, Inc.,
circumventing some steps in the process, etc. Mesa, U.S.A.)

AA015 Kenneth Sullivan

A Research Framework for Developing a (Ass. Professor, Arizona State University, U.S.A.)
Performance Evaluation Model for Target Cost
Contracts in Construction Dean Kashiwagi
(Professor, Arizona State University, Tempe, U.S.A.)
Daniel W.M. Chan
(Assistant Professor, Dept. of Building and Real Abstract
Estate, The Hong Kong Polytechnic University, Hong Design Services have been not meeting the value and
Kong) expectations of the clients and their project managers.
A research project has studied the impact of the low
Albert P.C. Chan, bid award environment on construction practices, and
(Professor & Associate Head, Dept. of Building and has proposed that designers’ current practices and
Real Estate, The Hong Kong Poly Univ., Hong Kong) expectations are price based and not performance
based. The authors also propose that the qualification
Patrick T.I. Lam, based system is a price based system and should be
(Associate Professor, Dept of Building and Real replaced by a best value system which includes a best
Estate, The Hong Kong Polytechnic University, Hong value selection process such as the Performance
Kong) Information Procurement System (PIPS.) The new
design model will give control and risk management
John F.Y. Yeung capability back to designers by utilizing a weekly risk
(Postdoctoral Fellow, Dept. of Building and Real report (WRR) and the risk management plan (RMP.)
Estate, The new PM model managing design firms will create
The Hong Kong Polytechnic University, Hong Kong) transparency; will give the advantage to the higher
performing professionals. The researcher interviewed
Joseph H.L. Chan over 400 designers to validate the concepts of the new
(Research Associate, Dept.of Building and Real designer model.
Estate,The Hong Kong Polytechnic Univ., Hong Kong)
AA038
Abstract Does the use of Partnering Lead to Improved
The aims of this research study are to establish an Project Performance?
Overall Performance Index (OPI) and to develop a
performance evaluation model for projects with Target Pauline Corbett
Cost Contracts (TCC) in Hong Kong. Four rounds of (Principal Lecturer, University of Wolverhampton,
Delphi questionnaire survey will be launched to identify Wolverhampton, UK)

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

scientific interpretation of the interface of the DSS

Jonathan Wright Model. The DSS Model operates using five engines
(Quantity Surveyor, Carillion PLC, Wolverhampton, and one interface to identify, calculate and compare
UK) between Financial Sources (Government, PFI,
International Fund and Grants) and Total Cost of
Abstract several variables such as, Know How (Local and
The objective for this study is to ascertain whether the Foreign), Labour (Local and Foreign), Training (Local
adoption of partnering and other construction best PM and Skilled Labour), Building Materials (Local and
practice principles lead to improvements in the project Import), Land (Urban and Rural). This in turn gives a
outcomes and deliverables on UK construction clear idea to governments on their financial sources,
projects where financing is from public funds. A series the total cost of the whole housing project, regulation
of pilot interviews are carried out with client, main and and legislations necessary and required to facilitate
subcontractor representatives to address this question. and support the housing industry, etc. The research
The main findings from the pilot research are that the methodology will consist of two parts; literature review
use of partnering is seen as having a positive impact which shed light on DSS Model in terms of definition,
on projects in terms of time, cost and end quality, stages, purposes, mechanism, how it functions, etc.
albeit not to the levels expected. The use of The second will introduce Interpretive Structural Model
partnering also leads to the project team embracing (ISM), which is used previously in a different stage of
other best practice tools. However results indicate one research to identify and prioritise Housing Industry
barrier to partnering realising its full potential is the Variables and DSS Model. Finally, the DSS Model will
lack of trust within in the construction industry and this be examined and tested using different scenarios for
stops the sector fully committing to more open project validation. The findings will be stated in the concluding
relationships as best practice principles envisage. section.

W003 W004
Decision Support System (DSS): A Strategic Tool Research Methodology Explained
for the Affordable Housing Industry
Imad Dawood
Imad Dawood (Research Institute of the Built and Human
(Research Institute of the Built and Human Environment (BuHu),University of Salford, UK)
EnvironmentUniversity of Salford, UK)
Jason Underwood
Jason Underwood (Research Institute of the Built and Human
(Research Institute of the Built and Human Environment (BuHu).University of Salford, UK)
EnvironmentUniversity of Salford, UK)
Abstract
Abstract Research Methodology is one of the nightmares a
The housing industry in the Developing World and for researcher has to endure. It is so confusing and
long time has suffered from underinvestment, the lack misleading because it is derived from philosophy.
of knowhow and the lack of sufficient strategies and Philosophy itself is hard to comprehend and explain
policies. This in turn, led to a total failure in even by experts in the field. The reason is that
performance, accumulative massive housing demand philosophy was first explored in the 5th Century BC by
and underachieving. Consequently, and because of the infamous Greek philosophers such as Aristotle,
the massive growth in the world’s population, Socrates, and Plato who are regarded as the fathers of
especially the Islamic World, people in the poorest philosophy. Scholars and Experts in the field of
countries have been the most affected and forced to Research Methodology have invested so much time
live in slums and shanty towns which some worldwide and effort attempting to draw a clear picture of the
have millions of occupants. This research paper Process of Research Methodology which is derived
presents a scientific approach to assist governments from Philosophy. However, most attempts or perhaps
and decision makers in the Islamic World setting up models of research are still hard to comprehend,
most sufficient and effective strategies and policies on understand and follow. In the light of this, Saunders et
the mega-level (country level) for the housing industry. al (2003, 2006) have introduced great Models namely
The final outcome of this research will produce a The Research Process Onion, which is widely used by
Decision Support System Model (DSS) which could be researchers to justify their research. However,
used by decision makers to setting up holistic, realistic Saunders Research Process Onion Models (2003,
and achievable strategies and policies based on the 2006) can be greatly improved by including and

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

positioning Epistemology and Ontology on the model.

This attempt will draw a clearer picture about research Sepideh Edrisi
process and make it easier to understand and follow (Grad. Student, The British University in Dubai, UAE)
by researchers. The outcome of this research is
expected to produce a comprehensive Research Arun Bajracharya
Methodology Model which is broader, clearer and links (Lecturer, The British University in Dubai, UAE)
and displays the relations and hierarchy among
philosophical and technical terms and domains such Abstract
as Axiology, Epistemology, Ontology, Research Rework can be taken as undesirable outcome in
Philosophy, Research Approach, Research Strategy, projects. Organisations use different approaches to
Research Choices, Time Horizons and Data respond and deal with rework during execution of
Techniques. projects. Some of the organisations might be well-
prepared to deal with it as a part of project, whereas,
AA113 others might be ignorant about it. In fact, the
First five years of conducting the Management in complexity of rework often deludes organisations
Civil Engineering group of courses within the which are even prepared to handle it. Understanding
Professional Study Programme and the of the physics of rework is crucial but it needs to be
Polytechnic Graduate Professional Study first understood how organisations perceive and tackle
Programme in the Polytechnic of Zagreb it in real life. This paper intends to present the rework
and its source that is understood at the ground level by
Časlav Dunović, M.Eng.C.E. project team members in an organisation which works
(Polytechnic of Zagreb - Department for Civil with power system projects in the United Arab
Engineering, Zagreb, Croatia) Emirates. A qualitative approach has been used to
explore the understanding of rework in the
Boris Uremović, M.Eng.C.E. organization. Semi-structured interviews were taken
(Polytechnic of Zagreb - Department for Civil with the project team members who deal with rework
Engineering, Zagreb, Croatia) practically and are interested to find proper solutions to
mitigate it. The interview data were processed and
Domagoj Šojat, B.Eng.C.E. assembled in terms of a theoretical framework that
(Student at the Polytechnic of Zagreb - Department for represents their interpretation of rework. It was found
Civil Engineering, Zagreb, Croatia) that “failure in quality” and “change from the side of
customer” are the two primary sources that are
Abstract responsible for generating rework in the projects. The
The Polytechnic of Zagreb organised two study understanding is practical but its adequacy is definitely
programmes, a 3-year Professional Study Programme worthwhile to be further investigated.
and 2-year Polytechnic Graduate Professional Study
Programme, and within those study programmes it AA010
embedded a group of courses about Management in A computer-aided conceptual cost estimating
Civil Engineering. With this paper we will try to review system for prestressed concrete road bridges
some of the basic success indicators of that group of
courses, e.g. enlisted students, finished students, Nikolaos Fragkakis
average grades, etc. We will also try to review the (Ph.D. Candidate, Centre for Construction Innovation,
results of the survey conducted among the students of National Technical University of Athens, Greece)
both study programmes who took the fore mentioned
group of courses. The survey regarded the student Sergios Lambropoulos
opinion on education conduction and their general (Associate Professor, Centre for Construction
grades of the study as a whole. The results will show Innovation, National Technical University of Athens,
the students general opinion about these groups of Greece)
courses, and it will show that the basic success
indicators point to a well balanced and concerted John-Paris Pantouvakis
group of courses about Management in Civil (Associate Professor, Centre for Construction
Engineering within both study programmes. Innovation, National Technical University of Athens,
Greece)
AA093
Generation of Rework: An Organisation’s Abstract
Perspective The need for an environmentally friendly design of

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29-31 May 2010, Heraklion, Crete, Greece.

modern motorways increases the construction of The purpose of this endeavour is to optimize the
bridges, which has exhibited substantial overruns allocation of the monetary resources to the project
above estimated costs. Therefore, easy to use, activities in such manner that will produce a lower
inexpensive and accurate methods for conceptual cost measure of financial entropy and a higher profit.
estimating are needed. Conceptual cost estimates are Modelling and evaluation of the proposed method is
made before the project’s detailed plans and performed by use of commercially available software.
specifications are known and rely on the conceptual The entropy-based approach results in an optimal
design of the project. Even though they present the solution that satisfies the initially stated purpose of
lowest expected accuracy, they are used by all the key simultaneously reducing the level of entropy and
people involved in the construction process. This increasing the profitability of the project.
paper presents a computer-aided cost estimating
system for prestressed concrete road bridges, which W002
provides estimates of the material quantities and cost The Use of the Construction Registers to Improve
of all bridge elements. It relies on a database the Competitiveness of Small, Medium & Micro
incorporating actual data collected from recently Enterprise Contractors
constructed bridges and exploits material estimating
models already developed for bridge superstructure Gasa B, Winston S.
and foundations. The respective models for bridge Abstract
piers are presented in this paper. Different This abstract outlines the research focus aimed as
configurations are devised from short to long-span demonstrating that the South African construction
bridges, accounting for the major deck construction industry’s use of the Construction Register Service
methods and foundation systems. The system can be (CRS), would improve the competitiveness of Small,
easily used to provide different cost estimates to the Micro and Medium Enterprises (SMMEs). The CRS
owner, designer and contractor during the project’s was developed by the Construction Industry
early stages, since all the required input data consists Development Board (CIDB) with the intent of offering a
of basic design parameters that are known during the basis for sustainable development, improved delivery,
preliminary study of each particular bridge. By allowing performance and empowerment. The study expands
reliable cost estimates in a short time, the proposed the industry’s knowledge base in as far as it relates to
computer-aided system represents a useful decision enhanced performance and competitiveness of
making tool. construction SMMEs. The research limits itself to the
levels of contractors registered between grades 2 and
AA074 5 with a view to establish a benchmark for contractor
Implementation of The Entropy Concept on competitiveness within those bands. The research’s
Construction Projects Under Financial Constraints unit of study is at company level drawing from a
reflection on the SMMEs active in industry. The
Konstantinos A. Galaras research deals with a real problem in industry and
(Civil Engineer MSc, Thessaloniki, Greece) therefore the theoretical underpinnings of an
epistemologically objectivist paradigm have been
Dr. Symeon Christodoulou employed in the study.
(Associate Professor, University of Cyprus,
Department of Civil and Environmental Engineering, AA048
Nicosia, Cyprus) A review of spatial considerations in project
scheduling
Evangelos S. Tezias
(Civil Engineer MSc, Thessaloniki, Greece) Loukia Georgiou
(Researcher, Centre for Construction Innovation,
Abstract National Technical University of Athens, Greece)
The paper investigates the relationship between
entropy (disorder) and financially-constrained projects, John-Paris Pantouvakis
through a case-study project (a highway project in (Associate Professor, Centre for Construction
Cyprus). The work builds on previous and ongoing Innovation, National Technical Univ. of Athens,
research at the University of Cyprus and at the Greece)
Democritus University of Thrace. A number of
mathematical models describing the aforementioned Yiannis Xenidis
relationship are developed, with an emphasis on the (Lecturer, Aristotle University of Thessaloniki,
effect of financial disorder on the progress of a project. Thessaloniki, Greece)

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Abstract Dimitrios M. Emiris

Project scheduling is considered as a study of the (Associate Professor, University of Piraeus, Greece)
relations between activities and time, it is well known,
however, that for certain types of projects spatial Abstract
considerations (e.g. site layout, facility planning, site During the project lifecycle, special treatment is
congestion etc) should also be taken into account. In required for crises, which may be prompted by the
this paper a literature investigation is performed with sudden trigger of internal or external perturbations, or
the purpose of indentifying all methodologies and they may be generated and become self-enforcing
techniques that take into account “space” as an entity over time until a certain threshold-limit is reached.
in producing construction schedules and the practical Crisis management, therefore, emerges as an
implications of this approach are discussed. It is essential systematic process, inherent in project
argued that it is mainly a lack of perception and not a management, which involves attempts to predict or
scarcity of tools that by and large lead to spatial identify potential crises that an organization may
considerations not being taken into account in most encounter, take precautions to prevent them, or
project time schedules. minimize their effects. The variety of crisis types
inhibits the generation of a unified treatment of crises;
AA022 instead, it is more appropriate to isolate and group the
Visualising Time: a GIS Approach most common crisis situations and their characteristics
and aim to depict the relationships between crisis
Loukia Georgiou causes and effects. In this work, we not only identify
(Researcher, Centre for Construction Innovation, and verify these relationships but we also solicit the
National Technical University of Athens, Greece) negative / positive effects between them and we
assign a weight in it. To achieve this, we use the
Ekaterini Varanou theory of Cognitive Maps (CMs) (based on qualitative
(Researcher, Centre for Construction reasoning) and its extension to Fuzzy Cognitive Maps
Innovation,National Technical Univ. of Athens, Greece) (FCMs). Generally, the basic elements of a CM are
simple, the concepts used are represented as nodes,
John-Paris Pantouvakis and the causal relationships between these concepts
(Associate Professor, Centre for Construction are represented as directed arrows. Each arrow is
Innovation, National Technical Univ.of Athens, Greece) characterized by a weight, a real value that indicates
the effect of the causal relationship between nodes.
Abstract The inputs and outputs of our model concern the basic
This paper presents a methodology for visualizing in characteristics of crisis and the ways of managing
3D the scheduling time data associated with the them. The main deliverable of our work is the
construction of a linear/ repetitive project. The representation, using FCMs, of the relationships
Repetitive Scheduling Method (RSM) algorithm is used between crisis triggers and impacts, and the provision
to provide the time data which then are visualized in a of a model of cross-correlations and interactions that
Geographical Information Systems (GIS) environment. can forecast the crisis outcomes depending on various
A three storey building is modeled with this confrontation strategies. We deepen our modeling by
methodology to illustrate the applicability of the analyzing all the phases in the crisis “lifecycle” and,
concept and to underline the benefits of the spatial and namely, pre-crisis, main crisis, re-establishment and
time data integration. This visual understanding of the learning, and model their inherent relationships. The
project allows efficient schedule communication resulting model provides an explanatory overview of
among the interested parties, although the the project crisis management mechanisms, useful for
methodology has still opportunities for improvement both the theorist and the practitioner.
mainly in the field of software package integration on a
AA032
single platform.
Two-Party Risk Assessment and Allocation Model
AA041
Awad S. Hanna
Conceptual Modeling of Cause and Effect
(Professor, Dept. of Civil and Environmental
Relationships among Crisis Elements in Projects
Engineering, Univ. of Wisconsin-Madison, USA)
Using Fuzzy Cognitive Maps
Justin R. Swanson
M.T. Giannopoulou
(Master of Science, Dept. of Civil and Environmental
(Graduate Student, University of Piraeus, Greece)
Engineering, Univ. of Wisconsin-Madison, USA)
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staged implementation of disparate systems created a

Abstract silo-like data structure. Same information was entered
Over the past few decades, numerous research efforts in different systems, by different people – reporting to
have been undertaken concerning the allocation of different organizations, in different time slots. The
construction risks. Nevertheless, industry participants Project Information System provides a common
remain concerned over the current practice of risk platform that allows for early collection of data in the
allocation/misallocation within construction contracting. source (owner) so that all subsequent users have the
Based on this problem, a research product that would same data available through interfaces to individual
aid contracting parties in determining how each risk systems.
can best be identified, assessed, and allocated was
developed. The risk allocation model is called the W008
“Single-Party Risk Assessment Worksheet” and is to Absence of Corporate Environmental Disclosure
be used internally to facilitate risk alignment within (CED) in Libya: A Research Note
each party’s organization. The results are later
compared in the “Two-Party Risk Assessment Adel Ishwerf
Worksheet” in order to begin the cooperative (School of the Built Envir., University of Salford, UK)
assessment and allocation process. This paper
presents the risk assessment tools developed and the David Eaton
details of the worksheets. (School of the Built Envir., University of Salford, UK)

ITPM1 Abstract
The use of Project Management Systems in Road Corporate Social and Environmental Disclosure
Construction Projects (CSED) was one of the main topics of argument in the
The case of the EGNATIA motorway literature, particularly in the 1970s and 1980s. Since
the early 1990s, the emphasis has been shifted to
Thanassis Iatropoulos Corporate Environmental Disclosure (CED) rather than
(Information Technology Manager, Egnatia Odos Corporate Social Disclosure (CSD). CED practice has
S.A.., Thessaloniki, Greece) become a topic of investigation among accounting
academic researchers in both developed and
Abstract developing countries. The literature has identified that
The Egnatia Motorway (670 Km) is one of the most the level of practices in CED in developing countries is
important modern infrastructure projects for the lagging behind the developed countries. However, it is
transportation of goods between North and Central worth mentioning that pressures for CED vary from
European countries with South East Europe, the country to country and from region to region, especially
Balkans and the Middle East. To handle the between developing and developed countries. This
complexity and adverse character of the project, paper presents an in-depth investigation of group of
EGNATIA ODOS A.E. the company responsible for the stakeholders’ perceptions towards CED in Libya and
administration of the project, has established a concentrates upon the absence of CED in Libya. It has
standard Project Management system which covers identified disincentives for CED in Libya. Evidence is
the whole range of project activities, i.e. Design, collected from in-depth interviews with thirty
Construction, Supervision, Operation and Maintenance interviewees from six groups of stakeholders namely:
of the road. In this paper we briefly describe the Decision Makers, Local Government, Financial
individual information systems used throughout the Institutions, Shareholders, Managers, and Employees.
life-cycle of the project and emphasize in the use of The findings suggest that there is a strong consensus
the Project Information System (PR.IN.S. or PIS). An between the six groups surveyed on a number of
overview of the company EGNATIA ODOS S.A. is disincentives for CED.
provided in the beginning followed by a chart of the
particular systems and software applications that were AA082
used during the various phases of the project. Among Construction contracts, project delivery methods
these systems, whether in-house or outsourced, a and roles of the project stakeholders. The case of
basic function that is common to almost all is the need Khalifa port project in Abu Dhabi
for timely and reliable reporting that is essential for
decision making. And this requirement can only be Nikolaos Kalyviotis
fulfilled if the data collected is accurate. To achieve (Student, Dept. of Civil Engineering, Aristotle
this goal EGNATIA ODOS S.A. has early realized that University, Thessaloniki, Greece)
data must be collected in the source. However, the

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29-31 May 2010, Heraklion, Crete, Greece.

Dimitris Kitsios management, and leadership based rather than

(Project Controls Manager – Gulf Region, Archirodon information based. The new decision-less
Construction (Overseas), Dubai, UAE) environment is being developed at the Performance
Based Studies Research Group (PBSRG) at Tempe,
Aristotelis Naniopoulos AZ in the areas of the delivery of construction, IT, food
(Professor, Dept. of Civil Engineering, Aristotle services, sports marketing, and document control. The
University, Thessaloniki, Greece) decision-less environment has a new contract model, a
new risk model, a new outsourcing model, and a new
Abstract project management model which manages a system
The main subject of this paper is to investigate and instead of a technical function/service.
review the main construction contracts used in
international environment, the project delivery methods AA103
and the roles of the project stakeholders. The greatest New Contract Model for Project Management
part of information and data were collected with the
assistance of the “Archirodon Construction (Overseas) Jacob Kashiwagi
CO. S.A.”, more specifically with the assistance of the (Researcher, Arizona State University, Tempe, U.S.A.)
department based in United Arab Emirates (U.A.E.).
The first author stayed with the aforementioned Kenneth Sullivan
company in U.A.E. for three months in the frame of his (Assistant Professor, Arizona State University, U.S.A.)
diploma Thesis. In the case of Khalifa Port in Abu
Dhabi a brief presentation of the involved “actors” is Dean Kashiwagi
made and the role of each one is described. (Professor, Arizona State University, Tempe, U.S.A.)
Responsibilities are recorded and presented, as a
result of a “structured questionnaire” survey with key Abstract
personnel and the contract documents analysis. It A new contract model has been developed which
appears that in certain positions the civil engineer is changes a project manager’s (PM) responsibilities
spending more time on issues not purely related to the from writing and enforcing a contract, to transferring
main civil engineering discipline. Particularly, working the responsibility of writing and administering the
in management positions in international construction contract to the vendor. The new environment changes
the civil engineer requires a good knowledge of the PM’s role from management, direction, and control,
financial and legal issues. to quality assurance. Quality assurance is ensuring
the vendor has a quality control and risk management
AA102 plan. The new model is based on the assumption that
The Decision-less Environment of the Future PM the client cannot control the vendor through the
contract. The control mechanism is deleted, and the
Jacob Kashiwagi vendor creates a contract document that minimizes
(Researcher, Arizona State University, Tempe, U.S.A.) risk. The contractual document, which must be
approved by the client’s PM and legal, includes a risk
Kenneth Sullivan managing mechanism called the risk management
(Assistant Professor, Arizona State University, U.S.A.) plan (RMP) and a weekly risk report (WRR.) The new
contractual mechanism is the expert contractor’s
Dean Kashiwagi mechanism to document and minimize risk and
(Professor, Arizona State University, Tempe, U.S.A.) transactions.

Abstract AA105
Project managers (PM) routinely make decisions in Strategic Plan for the Implementation of a New PM
managing projects. Decisions are made when the Model
project manager does not have sufficient information.
Decision making increases risk, and usually forces an Dean Kashiwagi
increase in project management, direction, and control. (Professor, Arizona State University, Tempe, U.S.A.)
The future PM model is one where decisions, direction,
control, and risk are minimized. Decision making will John Savicky
be forced to the lowest level, where the expert has (Lead Project Manager, Arizona State University,
been hired to minimize risk. The new model is one of Tempe, U.S.A.)
observation instead of using technical expertise, and
one of quality assurance rather than direction and Kenneth Sullivan

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29-31 May 2010, Heraklion, Crete, Greece.

(Assistant Professor, Arizona State University, U.S.A.) AA112

PROMETHEUS Construct: A Societal and
Abstract Environmental Responsibility Framework for
The University of Minnesota has been implementing Medium, Small and Very Small Construction
the best value Performance Information Procurement Companies
System (PIPS) for the last four years. PIPS uses a
new project management model which transfers risk Triantafyllos Katsarelis
and control to the vendor, and minimizes the client’s (Scientific Associate, Centre for Construction
PM activities. The performance of the vendors has Innovation, National Tech.University of Athens,
increased and the number of transactions has been Greece)
minimized, however, many of the project managers
have resisted the new PM model. The resistance of Iliana Adamopoulou
the PMs has resulted in the analysis of the strategic (Student, National Technical University of Athens,
plan to implement the new project management model. Greece)
The result of the analysis is that the strategic plan
must concentrate on the development of the core team Abstract
of visionaries and not on the implementation of the The issues of Societal and Environmental
new PM model. The tactical plan on the mechanics of Responsibility are related to the holistic approach of
the new PM model is also required, but is not as Sustainable Development and remain at top level of
important as nurturing the core team of visionaries who priority for theoretical and applied research. The
are leading the change. The strategic plan ensures framework PROMETHEUS addresses these issues,
the sustainability of the new PM model. oriented to Greek Medium, Small and Very Small,
private owned Companies, valorising a number of
W009 elements from recognized and widely in use models of
Evaluating IT as Source of Competitive Advantage Business Excellence and frameworks for Corporate
in Engineering and Construction Organisations Social Responsibility. It is constructed to be friendly
and easy-to-use for owners / managers of all levels of
Yahuza Kassim, Jason Underwood formal managerial education. In this paper a
(University of Salford, Salford, UK) specialised version “PROMETHEUS Construct” of the
framework is presented, targeting the sector of
Benny Raphael construction projects. The businessperson records key
(National University of Singapore, Singapore) elements of the permanent organisation and project
methods, in the form of questionnaires, and then uses
Abstract the toolbox, which includes material such as charts
Many studies have suggested that Information and tables, to help him towards the goal of leading the
Technology resources do offer strategic advantages to business in continuous improvement of Economic,
organisations and enhance their competitiveness Social /Societal and Environmental Results.
through efficient and cost effective delivery of the
organisations’ value chains. However, because most NGO1
of these studies were carried out through imprecise Guidelines and Project Management Handbook for
and unstructured theoretical constructs the empirical Greek Non Governmental Organizations (NGOs)
results were equivocal. Thus, the inconsistencies in
the outcomes of research on IT business value were Triantafyllos Katsarelis
ascribed to difficulties associated with modelling the (Scientific Associate, Centre for Construction
payoffs of IT investment, mode of data analysis, Innovation, National Technical University of Athens,
industrial context, and choice of dependent variables Greece)
as some of the major reasons. The paper adopts multi-
theoretical concepts of process-based, resource-based Nikolaos Depountis
views and microeconomics theory as the research (Quality Advisor, Member of the BoD PM-Greece,
framework to present a non-parametric model for Athens, Greece)
evaluating the impact of information technology
utilization in gaining competitive advantage in Iliana Adamopoulou
engineering and construction organisations. A pilot (Student, National Tech. University of Athens, Greece)
survey was conducted to verify the model value chain
and empirically tested the concept. Abstract
“APOPLOUS” was the outcome of a project assigned

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29-31 May 2010, Heraklion, Crete, Greece.

by the Coordination Committee of “the Campaign of completion. The paper is illustrated with a case study
800 Greek NGOs”, with the purpose of constructing a concerning the implementation of the method on a
set of “Values for Organization, Conduct and Practice” project in the construction sector.
for Greek NGOs. The main objective of the present
study was to construct a comprehensive, easy-to-use AA040
project management tool for Greek NGOs, as the PM-PEDIA: An Open-Learning, Expert-Based,
second add-on to “APOPLOUS”. An additional Mind-Mapping Tool for Project Management
objective was to facilitate Greek NGOs to be certified Education
under the Greek ELOT 1429 & 1431-3 Standards for
the “Managerial Capability of Organizations Dionisios Kontostavlakis
implementing Projects of Public Interest”, thus (Graduate Student, University of Piraeus, Greece)
ensuring their candidature for European Union co-
financed Projects. The authors based their study on Dimitrios M. Emiris
the latest International Competence Baseline version (Associate Professor, University of Piraeus, Greece)
in use of the International Project Management
Association and specifically on the Austrian and the Abstract
Greek National Baselines. The guidelines and the Efficient and coherent education in PM needs to
standardised handbook contained in the add-on, were couple the standards incorporated in systematic yet
used in a pilot phase by a selected sample of NGOs concise methodologies (such as the ICB® or the
and their feedback is included in the presented PMBOK®), with elaborated documentation, examples
version. and evaluation tools, in order to corroborate the
learning material. A challenge in this attempt is that
AA064 PM an inter-disciplinary field and as such, the existing
Reengineering Project Scheduling with Knowledge literature is vast and dispersed in various media
Management (books, articles, internet, etc.) Bringing the knowledge
elements from standards (which are mostly
Konstantinos Kirytopoulos guidebooks) and textbooks together in a form
(Assistant Professor, University of the Aegean, acceptable by learners and teachers, by maintaining
Greece) the completeness and integrity of scientific concepts,
is a challenging task.
Vassilis Stavrou
(Mechanical Engineer, National Technical University of SPM01
Athens, Athens, Greece) Lessons Learned from the Development of a
Project Management Suite
Elena Rokou
(Researcher, National Technical University of Athens, Pavlos Laoutaris,
Athens, Greece) (Task Force co-ordinator, MOU SA, Athens, Greece)

Abstract Abstract
The aim of this paper is to provide an effective method The paper inquires the project of the integration of the
for schedule reengineering and optimisation through Information Systems of a large Greek public
knowledge acquisition and corporate memory creation. Organisation by the development of a System aiming
The core problem of schedule development is about to interconnect these of the Organisation with the
defining each activity’s duration as well as the right Monitoring Information System (MIS) of the Ministry of
dependencies among project activities. Project – Economy, Competitiveness and Shipping. It was
oriented organisations specialised in one or more implemented in Athens from October 2009 until March
domains due to their experience can have highly 2010. The system consists of five sub-systems. Each
accurate project schedules and thus improved one is responsible for a number of tasks and contains
efficiency. The first part of the proposed method a large number of entities. Main objective is the
consists of monitoring all the existing processes process tracing, step by step, and their assessment,
related to the projects execution and the according to the theory and the commonly accepted
corresponding knowledge acquisition through procedures of project management. The first step to
monitoring project results. The second part handles approach the context of the project was to briefly
the creation of a corporate memory in the form of a depict the structure, the functions and the culture of
schedule prototype, along with all the needed the Organisation. The following step was to list down
processes in order to update it after each project’s all the project management sub-processes, as

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29-31 May 2010, Heraklion, Crete, Greece.

mentioned below, and assess each one individually, Abstract

using a scale from “poor” to “excellent”. Project Start The subject of productivity is one of the broadest, most
(Objectives, organization, environment, planning the complicated, and therefore vague subjects related with
scope, scheduling, and risk management), Project constructions. Much research has been done for
coordination, Project controlling, Resolving creating techniques which can efficiently measure
discontinuities and Project close down. The main productivity, and even more suggestions for its
conclusion is that there was not given enough effort improvement can now be found in related literature.
during the start process of the project. More This paper aims to introduce current techniques and
specifically, the selection of the project team and the methods for measuring construction productivity along
risk assessment were relatively unsuccessful. with their critique, and potential ways to improve their
use. In order for the present work to be completed,
AA054 people with great experience from construction
Comparative Evaluation of Project Management industry and academia were interviewed and an
Standards extended literature review has been conducted. The
data analysis reveals some unique issues that can
Paschalis – Anastasios Loukas lead to productivity loss, and also provide engineers
(Project Manager, OTE SA, Athens, Greece) with the current industry and academia trends on
improving productivity in constructions. The results of
Athanasios P. Chassiakos that research can help the engineering community
(Associate Professor, Department of Civil Engineering understand the seriousness of the construction
University of Patras, Greece) productivity problem, and provide engineers with
techniques and recommendations to face that
Abstract problem.
The increasing number and complexity of engineering
projects require the implementation of systematic W005
management procedures for effective project Student Difficulties in Conducting PhD Level
execution. Among existing project management Research - The Aristotle University of Thessaloniki
standards, PMBOK and PRINCE2 have prevailed. Case Study
PRINCE2 appears more suitable for disciplined
environments with strong leadership while PMBOK Andreas N. Malisiovas
may be more appropriate for organisations not (Professional Engineer, Department of Civil Eng.,
emphasizing on a strong hierarchy. Such standards AUTH, Thessaloniki, Greece)
can be effective in large or well structured
organisations but not so effective in organisations Abstract
without experience, ability or motivation to invest much The Greek academic community seems to be well
in project management. A guide that may be used to informed about the problems surrounding
assist organisations in developing a project undergraduate level studies but the unique situation of
management method internally is presented. The graduate programs still remains quite unknown. This
guide is structured upon a detailed questionnaire that paper aims to make the first step towards a valuable
aims to reveal the general directions for developing a discussion about the unique situation of the Greek
management method that meets the organisation University PhD programs, and explore the quality,
needs, to suggest practical implementation plans and feasibility and general philosophy which surrounds
actions, to help organising the management research at the PhD level. In order to extract
documentation, and to provide incentives for further conclusions about the research situation in Greece, a
investigation and development. The proposed guide is statistical survey was conducted among doctoral
flexible, directly applicable, adapted to the organisation students of the Aristotle University of Thessaloniki.
needs, and promotes people creativity and Students were asked to express their views on the
participation. research difficulties they face, by answering multiple
choice questions and also by making text comments.
AA067 The data analysis reveals some unique problems in
Construction Productivity: From Measurement to conducting doctoral research, and also illustrates the
Improvement need to transform the current PhD research philosophy
into an educational method more applicable to the
Andreas N. Malisiovas current academic needs of Greek Universities.
(Civil Engineer, University of Texas at Austin, USA)

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29-31 May 2010, Heraklion, Crete, Greece.

W006 A Multi-Faceted Approach to Construction

The Difficulty of Introducing the Main Subject of a Scheduling Research
PhD Research
Alexander Maravas
Andreas N. Malisiovas (Ph.D. Candidate, Centre for Construction Innovation,
(Professional Engineer, Department of Civil Eng., National Technical University of Athens, Greece)
AUTH, Thessaloniki, Greece)
John-Paris Pantouvakis
Abstract (Associate Professor, Centre for Construction
It is widely accepted that the definition and selection of Innovation, National Technical University of Athens,
a PhD research project is a very important and Greece)
complex procedure. Particularly in Greece, where PhD
studies are mostly supported by private (student) Abstract
funds, doctoral studies have become not only a difficult Although extensive research has been conducted for
but also a very expensive process. This paper the development of an algorithmic project scheduling
examines the Aristotle University of Thessaloniki case methodology allowing optimal resource allocation and
study in order to explore the difficulties a doctoral cost control, it has been realized that in real-life
student has to overcome for defining and organizing a situations a pure analytical approach may not be
PhD research project. To extract conclusions, a survey enough. In the current complex and multi-cultural
among active doctoral students was conducted. The project execution environment behavioural and
generated results can help us find the roots of the contextual issues should also been taken into account.
problem of designing and defining the subject of a PhD As such, issues relating to the organizational structure,
research. The data analysis provides findings which try personnel training, negotiation skills and the legal,
to answer questions about communication issues financial and political context may affect project
between PhD student and supervisors, the difficulty of scheduling beyond the modelling abilities of pure
organizing and designing PhD research projects, and algorithmic approaches. To this extent, the aim of this
the feasibility of making one’s ideal research come to paper is to review the effectiveness of various
life. research methods in the construction project
scheduling process. In particular, the adequacy of
AA020 quantitative and qualitative research methods in issues
Assessing the Procurement Process In Greece's pertaining the algorithmic formulation, behavioural
Construction Projects issues and contextual aspects of construction
scheduling is examined. Special attention is paid to the
Odysseus Manoliadis differences between the analytical formulation of the
(Assistant Professor University of Thrace, Greece) problem and human factors in the project context. It is
concluded that a multi-faceted methodological
Konstantinos Vatalis approach is required consisting of both quantitative
(Assistant Professor, TEI Kozanis, Greece) elements and qualitative ones based upon the
fundamentals of social and economic sciences.
Abstract
The aim of this research is to assess the application of AA117
recent Legislation towards sustainable procurement in Uncertainty in Scheduling Multiple Projects
Greece with special attention to the construction
industry. A questionnaire survey of twenty seven Alexander Maravas
experts (construction managers, industrial and (Ph.D Candidate, Centre for Construction Innovation,
academics) was carried out in order first to investigate National Technical University of Athens, Greece)
the awareness level and the constraints of sustainable
procurement practices, second to record the John-Paris Pantouvakis
procurement practices implemented in the Greek (Associate Professor, Centre for Construction
construction industry third to obtain experience of the Innovation, National Technical University of Athens,
above issues concerning procurement practices in the Athens, Greece)
Greek construction industry. The findings indicate that
although sustainability criteria are recognised as Sergios Lambropoulos
essential their use is limited. (Associate Professor, Centre for Construction
Innovation, National Technical University of Athens,
W011 Athens, Greece)

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Innovation, National Technical University of Athens,

Abstract Athens, Greece)
Whereas there is ample research literature available
on uncertainty in single projects, research on studying John-Paris Pantouvakis
uncertainty in a multi-project environment is scarce. As (Associate Professor, Centre for Construction
such, this paper aims at establishing a framework for Innovation, National Technical University of Athens,
modelling uncertainty in scheduling multiple projects. Athens, Greece)
The primary focus is determining the feasibility of the
fuzzy set theory application in the modelling of Abstract
scheduling uncertainty in the contemporary dynamic Predicting the condition of construction equipment is a
project execution environment. Issues such as crucial matter for the building industry since it directly
duration uncertainty, resource availability and multiple affects the company’s investment planning thus
project objectives are examined. It is concluded that resulting in considerable financial effects. Accurate
the proposed methodology could be particularly useful predictions could be useful for the planning of future
in practical applications. requirements concerning equipment maintenance,
replacement or procurement as well as for ongoing
ITPM4 earthmoving operations. Towards the above, this
An Integrated Information System for Monitoring research implements a stochastic model based on
Construction Works discriminant analysis and evaluates its effectiveness.
In particular, discriminant analysis is applied to data
Alexander Maravas provided by two large Greek Construction Companies
(Deputy Manager of Project Monitoring, Egnatia Odos and attempts to classify the vehicles in several
S.A., Thessaloniki, Greece) predefined condition levels, according to their
characteristics of age, kilometers traveled to date and
Abstract maintenance status. The results demonstrate that the
There is an undeniable global tendency towards performance of the prediction model is strongly
implementing centralized project monitoring with the dependent on the maintenance policy of the company,
use of advanced information systems in large projects. which forms the most substantial factor for further
This trend is mandated by issues such as the evaluation in the course of an effective total cost
geographical dispersion of projects, the numbers of management.
contractors and the total amount of works. In this SPM02
respect, the integrated information system that was An Integrated Approach to
utilized to monitor the construction works of the project Monitoring/Performance Assessment of
of the Egnatia Motorway in Greece is presented. Operational Programmes Co-financed by the
Reference is made to the software, hardware, European Union
information technology architecture, quality procedures
and personnel training for the successful Panagiotis Markoulidis,
implementation of the system. Special mention is (Managing Director, OMIKRON5 Ltd, Athens, Greece)
made to the data structures that are utilised (work
breakdown structure, organizational breakdown Aggelos Koutsomichalis,
structure, resource breakdown structure, and (General Director, EEO Group, Athens, Greece)
enterprise breakdown structure). In addition,
comments are made from the experiences drawn from Konstantinos Kloudas,
the implementation of the system. Overall, it is (Director, Enoros Consulting Ltd, Nicosia, Cyprus)
concluded that the system facilitates a central focal
point for corporate scheduling and cost control. Abstract
The main aim of the present paper is to present a
AA046 simple but efficient tool for monitoring schedule and
Prediction of Earthmoving Trucks Deterioration absorption performance at all levels required (from the
Using Discriminant Analysis individual contract to the whole programme) in order to
facilitate timely and adequate corrective actions by the
Marina Marinelli implementation of European co-funded programmes
(Ph.D. Candidate, National Technical University of and assessing the capability of the beneficiaries to
Athens, Athens, Greece) implement their projects on time and on budget. The
schedule and the cost (absorption) of each programme
Sergios Lambropoulos level examined (e.g. contract, project, etc.) are
(Associate Professor, Centre for Construction
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

integrated and recorded in a time-phased budget Malaysian contractors, namely: performance (direct
(performance measurement baseline). Moreover, the attributes) and contractor characteristics (indirect
actual time-phased absorption is recorded during attributes) that possibly influence contractor
programme implementation. Based on the above, satisfaction levels. These attributes are then
absorption and schedule performance is assessed developed to improve the existing conceptual
against the set targets through the definition and use framework. The developed framework is expected to
of a small number of performance indicators. help the project team in performing projects more
According to the values of these indicators, project, efficiently, maintaining service quality and improving
programme and beneficiaries performance are relationships between participants. In addition, the
classified into an adequate effectiveness (risk) scale. findings of the paper should assist contractors
Results of the practical implementation and use of the enhance competitiveness, improve their image and
method will be presented for three case studies (2 in create more job opportunities in the future.
Greece and 1 in Cyprus). This approach is easily
implemented in existing Management Information AA111
Systems or in widely used project management Low Energy And Passive Housing Standards In
software packages (e.g. MS Project, Oracle Primavera Europe
etc.) and does not require extensive knowledge of
project management. Vjeran Mlinarić
(Professor, Faculty of Civil Engineering, University of
AA075 Zagreb, Zagreb, Croatia)
A New Approach to Assessing Malaysian
Contractor Satisfaction Levels Zvonko Sigmund
(T.A., Faculty of Civil Engineering, University of
Md Asrul Nasid Masrom Zagreb, Zagreb, Croatia)
(PhD Student, School of Urban Development,
Queensland University of Technology, Brisbane, Sandra Trojak
Australia) (Executive editor, Magazine”Construction,, , Zagreb,
Croatia)
Martin Skitmore
(Professor, School of Urban Development, Abstract
Queensland University of Technology, Brisbane, Implementation of building energy ratio for new
Australia) buildings resulted with a need to establish standards
and certificates suitable for different building codes,
geographical locations and building traditions of a
Abstract specific nation or region. For Europe most highlighted
The extent of poor project outcomes is a recurring energy rating indexes are “EPBD” (“Energy
issue for construction industries worldwide. One of the Performance of Building Directive”), with British
main causes of these and project failure seems to be version “BER” (“Building Energy Rating”), German
the inability of contractors to provide a high level of “Energie-Pass” and Swiss “Minergie®”, as well as for
service quality to the project team. In Malaysia, design USA “LEED”. Also well known are standards for
failures have also been identified as a further extremely low energy buildings as “PassivHaus”,
contributory factor. To overcome this, different types of “Minergie®P-Eco”, “Zero Energy” and “klima:aktiv”. By
subjective performance measurement have been the directive of the European Union all the buildings on
progressively developed. These approaches are the market that are being built, sold, or rented need to
typically concerned with client satisfaction, customer be certified. Gained certificate and annual energy
satisfaction, home buyer satisfaction and occupant consumption data could be presented to anyone
satisfaction, but very seldom consider contractor interested, which will intensively affect the market. This
satisfaction. This paper examines the implications of article is presenting different energy rating certificates
this, and what is involved in developing satisfaction with specific energy consumption data which enables
measures based on contractor perception instead of the energy consumption comparison of different
the typical sole concern with client performance. As a buildings. The article also presents the comparison of
result, other attributes such as participants’ low energy building standards as: “PassivHaus”,
performance, business performance, project “Minergie®” and “LEED”.
performance, external factors and contractor
characteristics are also examined. Several potential PRC1
attributes are derived from interviews among Modelling with Uncertainty for Control Tasks

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29-31 May 2010, Heraklion, Crete, Greece.

A.J. Moutsopoulou conflict among all stakeholders in the region with grave
(Lecturer, Department of Civil Engineering, consequences.
Technological Educational Istitute of Crete, Greece)
AA118
G.E. Stavroulakis The Sustainability Dimension in IPMA Competence
(Professor, Department of Production Engineering and Baseline Contextual Elements at Project and
Management, Technical University of Crete, Greece) Programme Levels

A.T. Pouliezos Demetrios C. Panagiotakopoulos

(Professor, Department of Production Engineering and (Professor, Dept. of Civil Engineering, Democriutus
Management, Technical University of Crete, Chania, University of Thrace, Greece)
Greece)
Abstract
Abstract The objective of this paper is to open up a discussion
This study presents appropriate methods for control regarding (a) the attributes of sustainability affected by
modelling with uncertainty for the analysis of the project/programme manager (PM), (b) the PM’s
management activities and the certification that they potential for enhancing sustainability through the
meet the performance standards. Dealing with and contextual competence elements of ICB and (c) the
understanding the effects of uncertainty are important PM’s potential for affecting the natural, social, human,
tasks for the project controlling. Reducing the effects manufactured and financial capitals at the project and
of some forms of uncertainty (initial conditions, low- programme levels. It is suggested that, in
frequency disturbances) without catastrophically project/programme management, sustainability refers
increasing the effects of other dominant forms (sensor to three dimensions: (1) The survivability of the project
noise, model uncertainty) is the primary job of the as an operational and productive structure within a
feedback control system. Closed-loop stability is the programme; (2) the survivability of the programme as
way to deal with the (always present) uncertainty in sets of related projects; and (3) the social acceptability
initial conditions or arbitrarily small disturbance. This of the impacts (economic, social, cultural, and
paper outlines the methods available in the control environmental) from the project’s implementation
theory and their applicability on management systems process and products and the programme’s
evolvement. Two study tables are proposed as a basis
AA014 for further study. The PM’s role in enhancing
The Relationship Between Construction Conflicts sustainability is often more crucial at the project rather
Arising Between Oil Companies and Poverty of than at the programme and the portfolio levels.
Host-Communities in the Niger-delta region of
Nigeria AA052
The Role of Health, Safety and Green Principles in
Charles Olatoye Estimating Construction Productivity: An
(PhD Student, University of Manchester, UK) Empirical Framework

Abstract Antonios Panas

The purpose of this paper is to examine the nature of (PhD Candidate, Centre for Construction Innovation,
project conflict between oil companies and host- National Technical University of Athens, Greece)
communities in which they operate in Nigeria’s oil-rich
Delta region, with a particular focus on the place of John-Paris Pantouvakis
poverty in fuelling the lingering conflict and the (Associate Professor, Centre for Construction
difficulty in curbing the conflictual situation. The Innovation, National Technical University of Athens,
method is essentially a review of various available Greece)
relevant literature and deductive arguments that will
give insights to whether poverty can be a catalyst to Sergios Lambropoulos
conflicts between oil companies and host communities. (Associate Professor, Centre for Construction
The paper concludes that poverty of host-communities Innovation, National Technical University of Athens,
to a project is usually at the heart of many project Greece)
conflicts arising between operating companies and
host-communities. The paper usefully points out the Abstract
pervasive poverty in the Niger-delta region of Nigeria; The current approach to construction health and safety
and how poverty has continued to ignite serious (H&S) and green building underestimates the role of
production practices and focuses mainly to the
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29-31 May 2010, Heraklion, Crete, Greece.

formulation of general guidelines and best-practice AA044

policies. This paper adopts a different approach in that Factors influencing Project Risk Management
it integrates workers’ health as expressed by their Decision Making
thermal comfort and environmental parameters in
productivity estimation. An empirical framework is Papadaki M.,
presented to evaluate the relationship of the Predicted (Enterprise Risk Management
Mean Vote index to operational efficiency. Process Professional/Researcher, Rolls-Royce plc-The
mapping and simulation-based analysis is used for the University of Manchester, Derby, UK)
creation and comparative analysis of productivity
models. An exemplar investigation of formwork Gale A. W.,
operations illustrates the applicability of the proposed (Professor, School of Mechanical, Aerospace and Civil
approach. The main conclusion from the study is that Engineering, The University of Manchester, UK)
the implementation of the empirical framework enables
the creation of foresight in planning construction Rimmer J.,
operations by analysing productivity variations (School of Mechanical, Aerospace and Civil
compared to baseline estimates. It is believed that Engineering, The University of Manchester, UK)
such an approach provides a more realistic
representation of construction operations and Kirkham R. J.,
improves the accuracy of the estimating process. (School of Mechanical, Aerospace and Civil
Engineering, The University of Manchester, UK)
W012
A Critical Review of Published Research on Abstract
Construction Productivity Most investment decisions are characterized by
irreversibility and uncertainty about their future
Antonios Panas rewards. Understanding the nature and magnitude of
(PhD Candidate, Centre for Construction Innovation, cost overruns in projects is often considered to be one
National Technical University of Athens, Athens, of the most important challenges facing project
Greece) managers. The application, therefore, of Project Risk
Management (PRM) is widely regarded as in important
John-Paris Pantouvakis skill-set in a PM’s portfolio. Today’s highly volatile
(Associate Professor, Centre for Construction economic environment presents new challenges for
Innovation, National Technical University of Athens, those seeking to develop robust strategies to respond
Athens, Greece) to events that are likely to impact project budgets. This
paper reports on an ongoing doctoral research project
Abstract in collaboration with Rolls-Royce PLC. The project
Despite the large number of published papers in the aims to explore opportunities for improving the
area of construction productivity, a critical review of management of budget contingency in relation to
contemporary thinking with a discussion of the effective corporate risk management strategy. Initial
implications to current researchers is rarely attempted. findings suggest that senior managers recognise the
As such, this paper investigates the subject based importance of an effective risk management process.
upon published papers in major peer-reviewed journals However, there is a great opportunity of improving the
during the last decade. Eighty-nine papers published process of how risk management data can and should
in both construction journals and broader management be used. Two projects were studied with respect to
science journals have been analysed. The research major difference in the use of risk data. Findings
taxonomy identified three major fields: Archival indicate the importance of a top-down risk
studies, empirical research and simulation proposals. management approach. The awareness of senior
In terms of the methodological structure followed, three managers needs to be increased. To do this, risk has
major categories have been recognized: Experimental to be translated into profit through budget contingency.
frameworks, data collection techniques and modeling
proposals. The main conclusion is that the selection of AA121
the research methodology in published journal papers Collaboration Procurement Methods in
has been an intuitive decision, grossly relating upon Construction Projects-Greek Construction Industry
the researcher’s ontological and epistemological Clients’ Perspective
stance. However, general guidelines on the selection
of the most appropriate methodology in relation to the Theofilos Papadopoulos
research objectives are also discussed herein. (MSc., Hellenic Open University, Patras, Greece)

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29-31 May 2010, Heraklion, Crete, Greece.

structured manner results in considerable

John - Paris Pantouvakis improvements in their working practices and business
(Associate Professor, Centre for Construction performance. This paper describes a framework for
Innovation, National Technical Univ.of Athens, Greece) establishing a knowledge management strategy for
construction projects adapted to the Greek
Abstract construction paradigm. A brief comparative analysis of
Traditionally the construction industry characterized by recent knowledge management models is presented
adversarial relationships, the lack of cooperation followed by a discussion of the research methodology.
among project participants and the fact that The study identified the informational requirements of
construction companies and clients focus mainly on current knowledge capture mechanisms and
the reduction of project cost and neglect the value, are developed a knowledge management tool for
some reasons for the poor performance of construction construction projects. The tool’s structure and data
projects. This research aims to investigate the Greek requirements are explained. A case study in a Greek
construction industry, from clients’ perspective, in design company helped to establish the applicability of
order to present the most common project delivery the approach. A preliminary evaluation of the
methods used, the problems faced, the usage of knowledge management tool by the end-users
collaborative tools and the motivation factors that suggests that it is a useful template for the systematic
could lead clients to establish collaborative capturing and storing of useful knowledge. The main
relationships. The empirical data were collected inference emerging from the study is its contribution to
through a questionnaire to a population of 19 Greek the creation of a company-specific knowledge base for
Construction clients’. Findings confirm the traditional future reference, so as to solve recurring problems
method’s extensive usage in Greek construction pertaining to the construction process.
industry both from public and private
firms/organizations. As a result the problems that are AA033
reported are similar with the common problems that Correlating Multiple 2D Vision Trackers for 3D
characterized traditional procurement method. This Object Tracking on Construction Sites
paper suggests that although Greek construction
clients are familiar to some extend with collaboration Man-Woo Park
tools and have some knowledge of the benefits of (Ph.D. Candidate, School of Civil & Envir. Engineering,
collaboration in project performance, they need strong Georgia Institute of Technology, Atlanta, USA)
incentives, such as cost reduction, to establish
collaboration relationships. Christian Koch
(Postdoctoral Research Fellow, School of Civil & Envir.
AA045 Engineering, Georgia Institute of Tech., Atlanta, USA)
A Framework for the Implementation of a
Knowledge Management Platform in the Greek Ioannis Brilakis
Construction Industry (Assistant Professor, School of Civil & Environmental
Engineering, Georgia Institute of Technology, USA)
Eleni Papari
(Researcher, Centre for Construction Innovation, Abstract
National Technical University of Athens, Athens, Tracking methods have the potential to retrieve the
Greece) spatial location of project related entities such as
personnel and equipment at construction sites, which
John-Paris Pantouvakis can facilitate several construction management tasks.
(Associate Professor, Centre for Construction Existing tracking methods are mainly based on Radio
Innovation, National Technical University of Athens, Frequency (RF) technologies and thus require manual
Athens, Greece) deployment of tags. On construction sites with
numerous entities, tags installation, maintenance and
Antonios Panas decommissioning become an issue since it increases
(PhD Candidate, Centre for Construction Innovation, the cost and time needed to implement these tracking
National Technical University of Athens, Greece) methods. To address these limitations, this paper
proposes an alternate 3D tracking method based on
vision. It operates by tracking the designated object in
Abstract 2D video frames and correlating the tracking results
Contemporary construction organisations realise that from multiple pre-calibrated views using epipolar
managing the acquired knowledge in a more geometry. The methodology presented in this paper

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29-31 May 2010, Heraklion, Crete, Greece.

has been implemented and tested on videos taken in and clients. The principal goals and rationale of this
controlled experimental conditions. Results are research are inspired by the need to identify and curb
compared with the actual 3D positions to validate its such major obstructive factors. Thus, the research
performance. study aims to bring about contractually sound, practical
improvements to problematic situations in
AA083 contemporary practices. Such improvements are
Working Cultures and Human Resources in the expected to produce more equitable, efficient,
Construction Industry of the Balkan Peninsula transparent and less contentious outcomes in delay
claims resolution. To achieve the aim and objectives, it
Parthenopoulos Nicoleta is considered necessary to establish a firm
(Post Graduate Student, Aristotle University, methodological position for the research study. This
Thessaloniki, Greece) paper has strived to establish such position. In this
effort, various ontological, epistemological and
Stavroulis Savina methodological stand points are considered.
(Post Graduate Student, Aristotle University, Consequently, the paper has concluded the
Thessaloniki, Greece) appropriateness of using the naturalist paradigm in this
study.
Naniopoulos Aristotelis
(Professor, Dept. of Civil Engineering, Aristotle AA011
University, Thessaloniki, Greece) Factors Affecting Cost Contingency in
International Projects
Abstract
Factors such as characteristics of the human Gul Polat
resources, labour conditions, labour relations and (Assistant Professor, Istanbul Technical University,
others are referred to as “working cultures”. The basic Istanbul, Turkey)
goal of the current paper is to identify and discuss
main existing characteristics of the “working cultures” Mert Duzcan
that appear in the Balkan. Moreover to consider how (Planning and Cost Control Engineer, Alarko
attractive such characteristics are for the development Construction Co., Istanbul, Turkey)
of construction projects in the area.
Based on the analysis, the research concluded that Abstract
Balkan countries include a variety of labour “fields” Contractors include a reasonable contingency amount
under continuous evolution. A S.W.O.T. analysis (from as an allowance for potential risks in their bid,
the point of view of a foreign employer and employee) especially in international projects, in order to protect
led to the conclusion that these countries appear to themselves against possible failures as the
have interest both for the potential employer and international construction environment is highly
employee. influenced by several complex factors such as intense
competitiveness due to the existence of numerous
W001 competent rivals, unfamiliarity with the country, local
Research Methodological Position for a Doctoral conditions, and the client in question, uncertainties in
Study on ‘Apportioning Liability in Delay Claims’ the project environment, etc. The aim of this study is to
identify the importance levels of the risk factors that
Nihal Perera may affect cost contingency amounts in international
(School of the Built Environment, University of Salford, projects. Review of the literature indicated that there
Salford, United Kingdom) are 59 risk factors, and these factors are categorized
into 6 groups, which include; bidding stage-related
Monty Sutrisna factors, construction-related factors, finance-related
(School of the Built Environment, University of Salford, factors, country-related factors, company-related
Salford, United Kingdom) factors, and contract-related factors. Having identified
and categorized these factors, a questionnaire was
Abstract designed and data of 36 construction projects from 14
Central to successful resolution of delay based claims countries were collected for evaluation of these risk
is the fair and equitable apportioning of parties’ factors.
liabilities. However, such fairness and equity in AA070
apportioning may be fettered by many factors in Microblogging in Project Management: Improving
contemporary practices adopted by both contractors Project Communication and Documentation with

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29-31 May 2010, Heraklion, Crete, Greece.

Status Information
AA063
Dirk Röhrborn Limits to professional Project Management
(CEO, Communardo Software GmbH, Dresden,
Germany) David Shannon
(Managing Director, OPM Ltd, London, UK)
Martin Böhringer
(Research Assistant, Chemnitz University of Abstract
Technology, Chemnitz, Germany) This paper considers some of the factors influencing
the development of professional project management.
Abstract Some important limiting factors are identified. It is
Microblogging represents a significant change in intended thereby that:
enterprise communication, shifting from a push to a  A more realistic context will be used for developing
pull model where information consumers subscribe to the profession
relevant information sources. Especially scenarios with  Plans for the profession’s development will be
high degrees in information quantity and complexity more robust
may benefit from this approach. This is the case for  The global cost-benefit of project management will
project management, which can well be supported by be enhanced
microblogging tools. This paper introduces the The content derives from extensive relevant personal
technology’s concept, motivates use cases and experience as well as from wide reading of relevant
discusses two examples as well as available software texts. The topic is broken down into four main
tools. elements: external, internal, inherent and future.
The paper is designed for presentation rather than as
AA076 an academic record of research, although reference is
Consulting Company Practice in Providing of made to previous publications. Although trends and
Project Management Specialists by Masters limits are suggested, no firm conclusion is drawn.
Education Program Rather, further consideration along similar lines is
proposed.
Dmitry Sadkov
(Deputy Director, IBS, Moscow, Russia) AA016
Client’s Critical Success Factors in Outsourcing of
Alexandr Tovb Construction Projects
(Vice-President, IPMA, Moscow, Russia) Case Study: Tehran Municipality
Grigory Tsipes
Mohammad Ali Haghnazar
(Chief Consultant, IBS, Moscow, Russia)
(Ph.D. Student, School of Management and Econ.,
Sharif University of Technology, Tehran, Iran)
Abstract
IBS is a biggest Russian IT system integrator and Dr. Mehran Sepehri
consulting company - undoubted national leader in this (Associate Professor, School of Management and
area. As a project oriented modern consulting Econ., Sharif University of Technology, Tehran, Iran)
company it requires a large amount of advanced
specialists with high level of competences in all fields Abstract
of IT, consulting and management, particularly in To counter the competitive forces in the market, many
project management. To provide such specialists IBS firms re-evaluate their work by focusing on core
established its own Magistracy with Masters Education competencies and increasing their outsourcing. Due to
program in cooperation with worldwide known Moscow the project based nature of the construction industry
Institute of Physics and Technology (MIPT – “Fizteh”) identifying and evaluating key success factors will help
and Moscow Institute of Steel and Alloys (MISA). To top managers in implementation of successful
meet specific requirements of IBS project and product outsourcing. These organizations primarily aim to
portfolios not only the master’s course on project finish their projects based on a defined scope of time,
management, but also wider context of all Masters budget and quality, while accepted by the final
Education program was developed. Special topics of customer. In this paper, a conceptual framework was
project management are included in various disciplines defined based on literature review and interview with
of the program on information management, economy experts’ panel. Key factors related to the success of
and finance, strategic and operational management outsourced project were evaluated quantitatively in
etc.
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29-31 May 2010, Heraklion, Crete, Greece.

one of the largest project-based Iranian organizations, an organization. They have been widely adopted in
by using a questionnaire for one of their recent many organizations and accepted as a de facto
construction projects. Results show that successful industry standard for the replacement of legacy
implementation of outsourcing strategy in construction systems. This paper analyzes and presents the costs
projects is strongly influenced by the level of and benefits of ERP systems for project-based
coordination with the contractor, the contractor industries, which have lagged behind other major
selection, clear project objectives, well defined industries in adopting ERP systems due to their
technical tasks and client's top management support. project-centric nature and the high stakes involved in
ERP implementation. The challenges during the
AA091 process of ERP implementations are also identified as
Project Management Societies and Profession part of the effort to understand the implied costs of an
ERP system. The evidence of the costs and benefits
Miles Shepherd is drawn from previous studies and the analysis of the
(Hon Senior Research Fellow, UCL, UK) prevailing working practices in project-based firms.
The classification of the costs and benefits constitutes
Denise Bower a cost and benefit taxonomy which can be used to
(Professo., University of Leeds, UK) enable executives in project-based firms to make
informed decisions on their ERP system investments.
Abstract
This paper argues that professions are a form of AA116
occupational control. Traditional professions have Standardizing of Standards in IPM of Construction
exercised this control based on a common acceptance
of their contribution towards society. However, newer Jüri Sutt
professions, including Project Management, may not (Professor, Tallinn University of Technology, Estonia)
share the characteristics of traditional professions but
Tauno Hang
have been able to exercise occupational control by
(Doctorant, M. Eng., Tallinn University of Technology,
exerting power, influence and status through
Estonia)
professional bodies and their occupational strategies.
As the use of projects has grown, so too has the view Urmas Aaskivi
that project workers may be regarded as professionals (M.Eng.,Tallinnn University of Technology, Estonia)
and join organisations that mimic the structure and
ambitions of professional bodies. The influence project Abstract
management associations can exert can be seen as PM including construction nowadays crosses the
unhelpful to the overall development of the discipline borders of countries which points to the necessity to
being seen as restrictive if not coercive. This paper overcome borders of technical languages and culture.
examines three models from which a set of key For it is necessary to unify the quantitive measurement
characteristics needed to establish occupational properties of building materials. In the presented
control is drawn. The main implications for the model standardized standards of building materials
potential of project management as a profession are are connected with known technology of matrix coding,
centred on adjusting occupational strategy and control. scanning and decoding . The model can be used in
PM technology starting from the design of building in
AA098 form of specification of project elements, their
Enterprise Resource Planning Systems for Project- functions and resources bearing these functions and
Based Firms: Costs, Benefits & Implementation on the other side starting from the manufacture of
Challenges producing specified resources and passing through the
supply chain to the building site, including automated
Miroslaw J. Skibniewski control by owner’s supervisor. Implementing the BIM
(Professor, University of Maryland, College Park, USA) makes it possible to automatize over twenty
Yajun Zeng datamation procedures in the project life-cycle.
(Ph.D Student, University of Maryland, USA) AA073
Resource-Constrained Scheduling of Construction
Abstract Projects and Simulation of the Entropy Impact on
Enterprise Resource Planning (ERP) systems are the Duration and the Cost of a Project
configurable enterprise-wide information system
services that integrate information and information- Evangelos S. Tezias
based processes within and across functional areas in (Civil Engineer, MSc., Thessaloniki, Greece)
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

comparative analysis. Furthermore, it may serve as a

Symeon Christodoulou, Ph.D diagnostic tool, providing guidance to Project
(Associate Professor, University of Cyprus, Managers in the identification of the key skills and
Nicosia, Cyprus) competences that they will need to improve in order to
foster individual effectiveness. This preliminary field
Konstantinos A. Galaras research (the research is still on-going) is based on a
(Civil Engineer, MSc., Thessaloniki, Greece) structured questionnaire pilot-tested and adapted to fit
to Greek reality.
Abstract
The paper reports on research about the relationship AA018
between project resources and the entropy generated Development and Prototype Application of an Oil
during construction, as well as on the development of Spill Risk Analysis in a Coastal Zone
a related mathematical model. The aim is to optimize
the allocation of resources in a resource-constrained Tsimopoulou, V.
project by use of an entropy metric, to study the delays (Delft University of Technology, The Netherlands)
which occur during the project and to relate them with
the resources and the entropy in the project. Entropy is Abstract
hereby defined as the disorder brought about by the This paper introduces the development of a
fluctuation of resources in the project, and a higher methodology for performance of oil spill risk analysis in
entropy value relates to a higher risk in terms of coastal zones through a prototype application. The
schedule completion. The case study shows that a main objective of the research effort is to develop the
significant reduction of time (up to 25.7%) can be basis for a tool that can assess risks due to the
achieved by utilizing the entropy method for allocating occurrence of an oil spill event aiming at assisting to
resources. Furthermore, should a resource-constraint the risk response process. The methodology concerns
be imposed then the entropy approach results in a the processes of probability and consequence
schedule that shows a 6.25% improvement in duration assessment. The two processes are accomplished
(and 8% in profit) over the solution obtained by qualitatively with a risk prioritization based on Analytic
classical scheduling methods. The reported work Hierarchy Process. Being a decision-making
builds on previous and ongoing research at the technique, Analytic Hierarchy Process can only be
University of Cyprus and the Democritus University of used after some appropriate modifications, which
Thrace. transform it into a tool for prioritizing risks with respect
to their probability and consequence in different oil spill
scenarios. This is an approach that attempts to
AA056 rationalise the risk analysis stages and to indicate the
Skills and Competences of Project Managers uncertainties imposed to the problem, hence creating
a basis for optimization of the risk analysis results.
Panagiotis G. Trivellas, Ph.D.
(Associate Professor,, TEI of Larissa, Larissa, Greece) AA013
Analysis of Project Performance of a Real Case
Christos G. Drimoussis, MBA Study and Assessment of Earned Value and
(Chemical Engineer N.T.U.A., IPMA Level D, Earned Schedule Techniques for the Prediction of
MOU of Devel Programmes S.A.,Athens, Greece) Project Completion Date
Abstract Theodoros Tzaveas
This study aims to diagnose the skills and (Project Engineer, Egnatia Odos S.A., Thessaloniki,
competences profile of Project Managers in a holistic Greece)
approach by utilizing a comprehensive framework
(ICB–IPMA Competence Baseline Version 3.0, 2006). Stefanos Katsavounis
The Competing Values Model is adopted to (Assistant Professor, Democritus University of Thrace,
operationalize Project Managers’ effectiveness, as it Xanthi, Greece)
shares wider acceptance among researchers. It is
constituted from two dimensions (flexibility versus Glikeria Kalfakakou
control and internal focus versus external focus), (Professor, Aristotle University, Thessaloniki, Greece)
defining four quadrants that address distinct demands
in the organizational arena. The Competing Values Abstract
Model has also been utilised as a device for mapping The management of a project, especially in the
organizations’ leadership profiles and conducting construction industry, is without doubt a subject of high
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

interest, demanding and complex and in the same time informal learning in the specific field. With regards to
challenging and exciting. In the line process of the methodology of certification, a new, innovative
planning-supervision-control, the last element enables method of correlation of the learning outcomes with the
the manager to determine the deviation range of actual European Qualifications Framework is being proposed.
practice from the original planning. Developing a In parallel, the need for further research in the field of
construction schedule for a complex viaduct using the social economy, and especially with regards to the
software MS Project 2007, and tracking the progress methods of exploitation and integration of the
with real dates and durations, the results of Earned suggested methodology to non-governmental
Value (EV) and Earned Schedule (ES) techniques are organizations, is highlighted.
assessed regarding the duration forecasting accuracy
schedule performance of a late finish project. The AA023
schedule includes complex interrelations, logistics in Predicting Cost of Prefabricated Housing Using
relation to the effective management of construction Neural Networks
equipment and unforeseen events during the
Mladen Vukomanović
construction process. Three different scenarios are
(Research Assistant, University of Zagreb, Croatia)
examined, from the construction of the whole bridge to
a single structural element in order to assess the
Mirsad Kararić
effectiveness of the methods, their sensitivity to re-
(CEO, Libra Projekt, Ltd., Zagreb, Croatia)
baselining, and the contribution of critical tasks to the
end result. Mladen Radujković
(Professor, University of Zagreb, Croatia)
NGO3
Social Economy and Certification in the Context of Abstract
the EQF Political and economic pressures have become an
aggravating circumstance for construction companies
Anastasios Vasiliadis in achieving basic project management criteria, i.e.
(University of Aegean, Rhodes, Greece) cost, time and scope. The construction's low
performance only stresses out the need for improving
Georgia D. Christodoulopoulou current practices - especially in regard to cost.
(Institute of Entrepreneurship Development, Larissa, Therefore, we sought to find a critical set of variables
Greece) for predicting total cost of prefabricated housing. We
applied neural networks on data from more than 30
Ioanna C. Leontaraki projects and thus have identify 17 critical variables for
(Institute of Entrepreneurship Development, the cost prediction. The model was verified on 28
Thessaloniki, Greece) buildings with following performances: 85.7% of
predicted values had the deviation lower 5%, while
Abstract 10.7% had the deviation lower than 10%, in relation to
One of the economy sectors, which in the past years the actual cost. After validating the model on data from
has been concentrating the interest of researchers is 3 buildings, that had been new to the network, the
that of the social economy, contributing to the performances were as follows: 83.8% of predicted
development of regions and support of groups of the values had the deviation lower 5%, while 12.9% had
population that are struggling with significant problems the deviation lower than 10%. Therefore this model
of unemployment. The lack of a specialized executive showed to be very robust. Furthermore, this study has
dynamic workforce, and especially the weakness of also demonstrated a more efficient and effective way
the typical educational system to adapt to new data of predicting total cost of building. Thus construction
and conditions, has led many individuals with companies can influence project performance during
insufficient typical qualifications to be active as project early phases, and acquire more competitive
advisors and/or educators of social economy. The position on the market. Conclusion brings guidelines
present paper deals with the development of a for use of the model and gives recommendation for its
professional profile of the advisor of social economy further development.
and an innovative method of certification of non-formal
learning that responds to the directional guidelines of AA100
the EU in relation to the recognition of learning Informal Projects Management with Volunteers
outcomes. The research that was conducted, utilizing Participation
the Delphi Method on 45 participants in 3 different EU Marek Wirkus
countries revealed a necessity for the certification of (Profesor, Faculty of Management & Economics,
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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Gdansk University of Techology, Poland) current Greek legal framework addresses the issue of
risk management for occupational diseases in an
Abstract unsystematic and incomplete way. The research
This article presents the results research conducted to identifies certain weaknesses and makes specific
identify key elements influencing the success of suggestions towards a legal framework aligned with
projects managed in informal way with volunteer the respective international standard.
participation. The data was collected from several
“soft” projects. These projects included organisation of AA030
sporting, cultural, and charity events targeting large The Development of a Robust Resource
groups of people. The research involved discussing Constrained Project Scheduling Framework
the following areas:
 roles and activities of volunteers, Qaolin Yuan
 rules for employing volunteers , (Research Fellow, University of Manchester,
 factors influencing the success of the projects Manchester, UK)
including:
o the trust as the base of informal projects Yiannis E. Polychronakis
management, (Sen. Lecturer, University of Salford, Manchester, UK)
o intra-project communication,
o cooperation Abstract
o team work. The literature on resource constrained project
Project risk, reporting, execution control, and the role scheduling attempts to schedule projects with
of project culture as elements influenced on project deterministic activity durations subject to various
success were discussed. objective functions and possible additional
assumptions. During project execution, however, a
AA028 project may be subject to considerable uncertainty.
The Greek Legal Framework on Occupational Such uncertainty may lead to the actual realized
Diseases in Construction: Conformity to Risk activity durations to substantially deviate from the
Management Standard durations that were initially estimated in the baseline
schedule and cause a serious project overdue. This
Yiannis Xenidis paper offers a framework that deals with the project
(Lecturer, Aristotle University, Thessaloniki, Greece) scheduling problem from the start of a project through
to the finish, and therefore provides a whole robust
Maria Anastasiou project scheduling strategy which is more tolerant to
(Civil Engineer, Kounna Bros. Enterprizes Ltd., various uncertainties. Our framework combines the
Larnaca, Cyprus) buffer sizing technique, proactive project scheduling
approach and reactive project scheduling approach,
Socrates Maggos which are usually implemented at different stages of a
(Student, Aristotle University, Thessaloniki, Greece) given project. The proposed scheduling framework
constructed based on these approaches is tested
Abstract using a large experimental design in order to detect
This paper investigates the conformity of the Greek the effectiveness of each procedure.
legal framework on occupational diseases in
construction with the guidelines for application of risk AA114
management as described in the Project Management Planning, Implementing and Managing Energy
Body of Knowledge, a credible international standard. Efficiency Projects at Focused Local Level: The
The aim of this research is to identify specific RURASU Project Successful Example and the
provisions in the Greek legal framework that require SAVE-AGE Project Objectives
further improvement towards an effective risk
management of occupational diseases. To achieve Konstantinos C. Zapounidis
this goal, related laws and presidential decrees are (Project Manager, Pieriki Local Development Agency,
analysed and their provisions are associated – based Katerini, Greece )
on content – to the appropriate risk management
process. The identification between the levels of Betty A. Partsalidou
compliance of legal provisions with the specifications (General Manager, Pieriki Local Development Agency,
described in the standard is performed through Katerini, Greece)
comparative analysis. The results reveal that the
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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Darko Ferčej analysis method is based on actual data and on actual

(Director of e-institute, Institute for Comprehensive processes that have led to successful conservation
Development Solutions, Ptuj, Slovenia ) results-results that demonstrate the actual need for
reformation.
Anja Prislan
(Project Manager, Institute for Comprehensive AA079
Development Solutions, Ptuj, Slovenia) Projects for the Design of Changes

Abstract Dagmar Zuchi

The effort to succeed the EU’s commitment of the “20- (Partner, Roland Gareis Consulting, Vienna, Austria)
20-20” initiative-reducing greenhouse gas emissions
by 20%, increasing the share of renewable in the Abstract
energy consumption to 20% and improving energy According to Levy and Merry (1986), changes can be
efficiency by 20%, requires multi-level actions and differentiated into first order changes and second order
special projects that should be focused on specific changes. First order changes describe changes in few
targets. Additionally to the large-scale projects, mainly dimensions of the identity of an organization (e.g.
focused on RES at national level, it is important to changes in the products & services offered) that might
provide support and knowledge at local level, be performed continuously and not necessarily lead to
especially in the sector of energy efficiency. Local a change of the overall identity of an organization.
actors and citizens outside major urban areas are Second order changes include changes in many
often unaware of techniques and measures that could dimensions (e.g. the new organizational structures of a
add the maximum potential gains to the overall targets company, including impacts on personnel,
in the energy sector. For this reason, Pieriki infrastructure, budget, etc.) and lead to a new
Anaptixiaki-local development agency in Greece paradigm, a change in the identity of a company. In
(Pieriki) has implemented successfully several projects the paper, change will be considered as fundamental,
focused on disadvantageous categories of citizens and holistic change of an organization, and it will be further
areas. Moreover, Pieriki is launching, under the differentiated between “radical new positioning” (as
coordination of E-zavod (Slovenia), a new consequence of a crises or chance) and
transnational project focusing on strengthening energy “transformation”. This “discontinuous” change can
efficiency awareness among residential homes for happen if strategic alliances are undergone, through
elderly people, under the title of SAVE-AGE. the merger of companies, or through existential loss of
market shares. Such a change has an impact to all
AA095 dimensions of an organization and is of high strategic
Reformation of Local Development Agencies importance. The high complexity of the change
Seeking Conservation in their Wider Market demands an appropriate complexity in the design of
the process. On the one side, immediate measures
Konstantinos C. Zapounidis must be taken, on the other side, projects respectively
(Project Manager, Pieriki Local Development Agency, programs as temporary organizations can be used for
Katerini, Greece) structuring the change.

Betty A. Partsalidou
(General Manager, Pieriki Local Development Agency,
Katerini, Greece)

Glykeria Kalfakakou
(Professor, Aristotle University of Thessaloniki,
Greece)

Abstract
Local development agencies, acting in Greece for
almost 20 years, are facing important threats for their
existence; the general crisis and the specific new
imposed frameworks require immediate actions. Aim of
this paper is to analyse this situation and to provide
information on the detailed framework that could be
adapted in order to succeed conservation. The

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PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Fifth Scientific Conference on

Project Management (PM-05)
Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”

29-31May 2010
Moevenpick Resort & Thalasso Hotel,
Heraklion, Crete, Greece

Conference Papers

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 PM-05 - Advancing Project Management for the 21st Century
“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

AA094
Critical Review of the Current Public-Private-Partnerships Legal
Framework in Greece with Respect to Legal Risks Management

Elsa Adamantidou
(Lawyer, Legal Adviser of Public Procurement Monitoring Unit
Rechercher in Centre of International and European Economic Law, Greece)

Yiannis Xenidis
(Lecturer, Aristotle University of Thessaloniki, Dept of Civil Engineering, Greece)

Panos Papaioannou
(Professor, Aristotle University of Thessaloniki, Dept of Civil Engineering, Greece)

Abstract
Success of Public Private Partnerships (PPPs) heavily depends on the host country’s legal
and regulatory framework. Legal risks are primarily connected to inefficiencies of legal
agreements and documents and lack of specific and clear provisions and regulations.
This paper presents an inventory of legal risks based on literature review and compares
it to the current legal framework for PPPs in Greece aiming at highlighting the latter’s
strengths and weaknesses with regard to the management of risks. The results of the
analysis indicate several strengths of the current legal framework, while the major
weaknesses are the vagueness in certain cases, which allows for various interpretations
and the negligence in the enforcement of laws and regulations.

Keywords
Risk management, Legal risks, Public Private Partnerships

1. Introduction

A Public Private Partnership (PPP) is a well known method all over the world employed
to deliver projects or offer services to the public. It consists of cooperation between
public and private sector partners, with the aim to deliver a service or a facility to the
public that is traditionally provided by the public sector. The partners offer their skills
and assets and share the various risks associated with the project. The reasons for
choosing a PPP as a project delivery method usually lies at legislative, budgetary or
public pressures.
The main advantages of PPPs, according to the European Commission, Guidelines for
Successful PPPs (European Commission (2003)) are the following:

 Acceleration of infrastructure provision  Better incentives to perform

 Faster implementation  Improved quality of service
 Reduced whole life costs  Generalization of additional revenues
 Better risk allocation  Enhanced public management

PPPs are associated with a great number of risks, which may cause delays and/or
problems to the realization of projects. Risks can be attributed to a number of factors
affecting the success of a PPP at different project stages. One very important factor is
the legal framework. The comprehensiveness of the legal framework about PPPs can
significantly boost or hinder the adoption of the PPP method and create undesired
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29-31 May 2010, Heraklion, Crete, Greece.

effects both to the cost of public works and to the related markets. For a classification of
legal risks the reader can look at Xenidis and Angelides (2005), Wang et al. (2004),
Lensink et al. (2000), Bing et al. (1999), Wang et al. (1999), and Menheere and Pollalis
(1996).

This paper reviews the current legislation in Greece that governs the PPP method and
attempts to identify strengths and weaknesses with respect to the management of legal
risks.

2. Legal risks in PPPs

Legal risks constitute those risks that emanate from the uncertainties at the
interpretation and negligence in the enforcement of rules of law. The concept of legal
risks may address also political, social and organizational risks in the sense that these
risks are, also, perceived through documents of legal nature (Xenidis and Angelides,
2005). Based on the previous work by Xenidis and Angelides (2005) a set of 23 risks is
presented in Table 1 (these of primarily legal nature are presented in bold). The
presented risks may apply to any case of PPP, however not all risks are equally expected
in a specific project. Moreover, not all risks are of the same type or generated by the
same source (i.e. public or private sector).

Prejudiced and unfair process of awarding the project

Host-country’s interference in choosing subcontractors
Overprotective control/supervision by the host government
Disapproval of guarantees by the government
Unfavorable changes of host-country’s policy
Change of host-country’s fiscal regime
Expropriation/Nationalization of the project
Lack of political support by the government
Lack of political stability
Non-cooperation between different public agencies
Actions or omissions of the public authorities that prevent the project to be
completed
Varying focus for the project by the parties involved
Vague and inconsistent clauses and specifications and inaccurate phrasing
Non-accordance between all contracts in the PPP framework
Language barrier for the contract
Breach of contract provisions
Relatively unknown status of the stakeholders
Unanticipated change of the concessionaire scheme
Lack of confidentiality and trust in the concession company
Public opposition if environmental or social impacts are questionable
Force majeure
Public disorder / Riots
Terrorism

Table 1: Risks in PPPs

Legal risks may occur and re-occur at different time periods during the project’s
lifecycle. In order to minimize adverse impacts from risk occurrences, a transparent,
fair, and steady legal and regulatory framework coupled with proper application of risk
management processes is required. The next sections analytically present the current
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

framework in Greece and prove the level of compliance with the abovementioned
requirement.

3. PPP legislative framework in Greece

 EC rules concerning PPPs

At the European level there is no concrete legislative framework governing PPPs.

Instead, the European Commission relies on the experiences of the European Union’s
(EU) member states, in order to identify the minimum common characteristics of PPPs
and, also, to attempt a first codification of the various PPP forms (Commission of the
European Communities (2005), Commission of the European Communities (2004),
European Investment Bank (2004), European Commission (2003), European
Commission (2000)).

The long term partnership between the public and the private sector, the financing from
private funds, the allocation of the various risks and, finally, the special new roles
undertaken by both the partners from both sectors can be identified as common
characteristics in PPPs.

When it comes to codification, PPPs can be classified into a) institutionalized

partnerships and b) partnerships of contractual type. For the former type a new legal
entity needs to be established in order to accomplish the PPP goals. This new entity is
being established either ad hoc or by partial privatization, meaning that private entities
acquire part of the capital of an existing entity of the Public Sector. In both cases, the
control of the entity is shared among the partners of Public and Private sector.

In the case of contractual type partnerships, the partnership is established through a

special contract. The PPP contract can be either a Concession Agreement between the
public and the private sector partners on which the private partners finance and
implement a facility or a service and receive user fees as a return, or a Private Finance
Initiative (PFI) where the private partner is being paid during the contract period by the
public sector. Payments can be either fixed or variable depending on the agreement
terms.

 Greek law 3389/2005

In Greece there was no specific legislative framework for PPPs until 2005. There had
been several cases of PPPs but mainly in the form of concession agreements for the
Design, Financing, Building, Operation and Maintenance (DBFO) of major infrastructure,
passed through parliamentary ratification. Recent examples of such concession
agreements include the Rion-Antirrion Bridge, the Athens International Airport, the
ATTIKI ODOS Freeway and the new concession motorways of Greece. All of these PPPs
have been of contractual type. Further in the past a number of major projects had been
realized through PPP initiatives such as the Korinthos Canal, the Electric Power Industry
(DEH), etc.

The first specific law providing for PPPs in Greece is L. 3389/2005, further amended by
L.3843/2006 (Article 16, Par. 1).

The PPP definition included in L. 3389/2005 speaks about a co-operation contract, from
pecuniary interest, among public and private sector entities for the construction of a

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

facility or the provision of services in areas of responsibility of the public sector partners.
It is therefore identical to the general definition given previously in the introduction.
However, PPPs, according to L. 3389/2005, can be only of contractual type; in this
respect Greek legislation is narrower than the respective legislation of other EU member
states.

Given the complexity of the various legal relationships which are created in a PPP
agreement, the main PPP contract is accompanied by ancillary agreements with third
party entities, governed by the same legislation (i.e. agreement between the
concessionaire and the constructor, the concessionaire and the service provider, the
loan contracts, the insurance contracts, etc).

According to L. 3389/2005, public sector partners can be the public authorities

(ministries, regional authorities), local authorities (prefectural and municipal
authorities), other bodies governed by public law and those legal entities under private
law, which are fully controlled by public authorities.

Individuals are not allowed to be private partners in a PPP, unless they create a special
purpose limited company. Special purpose companies, according to Greek legislation,
are those which are established exclusively for specific purposes, in this case for the PPP
purposes. Public authorities can establish a special purpose company with other public
sector bodies, provided that they do not own 100% of the capital. This means that
public entities can be only contractual partners in a special purpose company and not
regular shareholders.

Specific restraints are applied to the transfer of the shares of these companies of special
purpose in order to secure transparency and direct control over the composition of the
shareholders. The lending institutions (i.e. banks) are happy with this because they
prefer to have transactions with legal entities that have a specific scope and they are
not involved in other businesses.

Based on the above, L. 3389/2005 does not cover institutionalized PPPs, since it does
not provide for the establishment of a mixed capital company, neither the transfer of
part of a public enterprise to a private legal entity. This is rather a disadvantage of the
specific law. Institutionalized PPPs will have to be established through other legal
procedures.

4. Critical Review of L.3389/05

L. 3389/2005 was initially saluted positively by the legal and business communities of
Greece because it was considered to provide a steady legal environment able to
encourage the PPP concept and create a reliable market environment. In fact it is still
believed that many of its provisions have been to the right direction since they could
overcome many legal risks and could speed up investments for the benefit of the
country. More specifically the main advantages of this law are the following:

Central administrative support and guidance for the public authorities, through the
establishment of the Inter-Ministerial Committee for PPP (collective governmental body)
and the Special Secretariat for PPP (PPP unit), (art. 4, par. 2d).

Provision for standardized contracts and ancillary agreements, to speed up procedures –

this goal has not been achieved yet (art. 4, par. 2h).

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Aim to comply with EC rules and general principles of public procurement; for the 1st
time the public procurement general principles have been defined in an article of Greek
law (art. 9)

Clear definition of the applicable legislation, as sole framework binding the public and
private entities, in order to ease the fears of the potential investors and the markets
from the vast Greek legislation (art. 17, par. 1)

Central definition of the procedure to collect the contractual fee, by providing that the
PPP Unit is competent to define the procedure for the private entity to collect the
contractual fee, in case that the fee is to be collected directly from the final users of the
work or service (art. 19)

Presumption of administrative permits issuance, by providing –and for the 1st time in
Greek legislation-, that these permits shall be deemed to have been issued, if the
authorities responsible for issuing them have not proceeded to issue a written, reasoned
refusal to issue the permits within a period of 60 days after the private entity has
submitted the application for the permit; that all administrative permits required for the
project shall be issued in the name of and for the account of the private entity (art. 20)

Deadline for the Archaeological Authority to react, by providing –for the 1st time in
Greek legislation- that in the event that archaeological remains are uncovered during
construction, the public authority shall, upon being notified by the private, communicate
the event to the appropriate archaeological authority, which within 60 days must
indicate ways for continuing the project works and proceed to the necessary actions in
order to secure the protection of the antiquities (art. 21)

Provisions for the environmental impact studies and the protection of environment, by
providing that the environmental impact studies required in each project shall be
prepared and submitted for approval; they need to be approved before the award of the
PPP contract; if the public entity involved, for reasons that could not originally have
been predicted, even if special care is applied, imposes additional regulations, it must
indemnify the private company for any additional cost or expense it may have
sustained; the contract may include measures for increased protection of the natural
and cultural environment, as long as these measures have been included in the
respective invitation to tender (art. 22)

Presumption for the expropriations; the expropriations or the constitution of rights in

rem or liens to those properties under the law shall be deemed to serve purposes of
obvious public interest and shall be regarded as urgent and of major significance,
provided that the official approval of the compulsory purchase includes adequate
evidence that the particular expropriation serves objectives of public interest (art. 23)

Provision for immediate and in order of priority reaction of public utilities companies;
Public agencies and public utility companies are entitled to proceed immediately in order
of priority to carry out work and implement measures within their area of responsibility,
which are necessary or useful for the smooth and unhindered execution of works or
provision of services under this law; if the public agencies and utility companies do not
fulfill their obligations, the private may request and the public entity shall be obligated
to grant an extension of the deadlines laid down in the contract and the private shall be
again entitled to seek redress for any loss it may have sustained as a result of the said
delay (art. 24)

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29-31 May 2010, Heraklion, Crete, Greece.

Legal objectives; the possibility of assignment of claims under the contract (art. 25); the
fact that the validity of sureties in rem are not compromised by any subsequent
bankruptcy (art. 26).

Financial objectives; the income tax exemption on accrued interest payable up until the
date of commencement of the operation; the special tax regime applicable to financing
contribution by a public entity (the amount of aid shall be construed to be a capital
subsidy and shall not be subject to VAT, income tax or any other tax, and shall be paid
free of any withholdings in favour of any third parties); the return of VAT credit balance
within 90 days to third parties under contract with the private entity and finally the
possibility for the private entity to transfer and settle accumulated losses against the
taxable profits of the next 10 financial years (art. 29)

Resolution of disputes, by mentioning that any dispute arising in relation to the

application, interpretation or validity of the partnership contracts or ancillary
agreements shall be resolved by arbitration; moreover and in deviation from the
provisions in force for public sector arbitration, the Contract sets out rules for the
appointment of arbitrators, the rules of arbitration to be applied, the place of the
arbitration court (or other body), the fees to be paid to the arbitrators (where fees are
not specified in the applicable arbitration rules) and the language in which the
arbitration shall be conducted; the arbitrators' decision shall be final and irrevocable,
and not subject to any further judicial or extra-judicial appeal; it shall be carried out
without any requirement of ratification by the regular courts, and the parties involved
shall be committed to comply immediately with its terms and conditions (art. 31).

5. An overview of the current situation

Until the promulgation of L. 3389/2005, the most important PPP contracts had to be
ratified by a specific law. Regardless of this legalization procedure these contracts had
suffer, and still suffer a lot for various reasons. The most important of them is
associated with the lack of flexibility to amend the agreements in order to adapt them to
a rapidly changing environment. There are cases the agreements cannot serve public
welfare after a time period, but the obvious changes are not legally possible. Another
disadvantage has been that the ratification procedure has been mainly acting as
disincentive to create a PPP for a small budget project, because the inevitable long
delays and the resulting extra cost that was making PPPs less cost effective. Despite
that some successful PPP contracts were achieved such as the Rion Antirrion Bridge, the
Athens International Airport and the ATTIKI ODOS, though for the latter the previously
mentioned comments are fully applicable.

After the promulgation of L. 3389/05, parliament ratification of PPP contracts for the
cases included in this law, is no longer needed. Specific issues that justified the
ratification are efficiently manipulated in the law text. The law applies to PPP projects up
to 200 mio € and makes clear that only a limited number of mature plans can enjoy the
provisions of this law. Inclusion of a PPP project plan to this law is not compulsory, but it
is optional. The general legislation about public contracts for concessions, services or
public works remains valid and all EU Community directives (2004/17 and 2004/18) are
fully applicable as well as the respective Greek laws (L. 3669/2008, L. 3316/2005 and
PD 59/2007 and 60/2007). However major project contracts over 200 mio € will still
may go through parliament ratification.

Currently, 5 years since the elaboration of the Greek PPP law, the competent
administrative body has approved many projects of different types: construction and
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maintenance of hospitals, of administrative buildings, of school buildings, of university

buildings, of court houses, of prisons, of International Conference Center, of fire
stations, installation and operation of security systems in Greek ports.

However, since 2005, and based on available data, only one PPP contract concerning the
construction and maintenance of 7 new fire stations has only been signed. Some 70
other projects are in the pipeline waiting for the final go-ahead. These facts prove that
the application of this law is very slow, despite its many good provisions. The main
issues that hinder the successful application of L. 3389/2006 are in our opinion, the
following:

 Lack of specialized personnel and lack of centralized support mechanisms; this was
translated into extra time and cost since the authorities were obliged to hire, following a
tender procedure, advisors/consultants to prepare the PPP tender documents.
 Lack of standardized procurement documents, though the need for standardization
of the contracts and the new award procedure (competitive dialogue) is obvious
 Instable political commitment – incapacity of the public sector to manage its side,
though legal certainty is particularly important in attracting interest in long term, in high
levels of investment and in long term financial commitments by the contracting
authorities
 Lack of an overall plan before decision
 No seek of best value for money resulting from a life cycle evaluation

6. Conclusions

After the introduction of L. 3389/05 a large number of potential legal gaps, associated
with this type of contracts, have been filled. The specific law makes a lot of provisions
that facilitate promotion of PPP schemes, aiming to implement facilities or provide
services to the public, and also allocates risks among public and private partners arising
from legal issues.

However, the de facto slow application of L. 3389/05, which is mainly attributed to the
inability of the public sector to respond to the challenges of our era, shows that the
legislation itself is not enough, neither to secure success of PPP initiatives, nor to
significantly reduce risks.

The efforts of the Greek state to boost provision of services and new facilities through
PPPs, without further burdening public debt in the short run, did not yield the expected
outcomes, at least in the first 4-year period following the introduction of L. 3389/05.
Furthermore, the large amounts spent for consultant fees to support public authorities
made PPP’s less attractive. A better overall picture will be possible only after the
finalization of the procedures which have already started for the projects included in the
Government plans.

Current legislation about PPPs in Greece seems to favor projects under 200 mio €, but
the fact that only a very limited number of projects have been realized, proves that the
environment for PPPs is still not the right one. Most authorities, despite that lack of
funds for investments, prefer the approach of the conventional public debt tender. In
this case, risk allocation is irrational and results to higher costs of project
implementation and lack of best value for money. What seems to be needed is a Public
Administration reform rather than a radical change in PPP legislation combined with
extended staffing of these authorities. with specialized personnel
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7. References

Bing, L., Tiong, R.L.K., Fan, W.W. and Chew, D.A. (1999), “Risk management in
international construction joint ventures” Journal of Construction Engineering and
Management, 125(4), 277-284.
Commission of the European Communities (2004), “Green Paper – On Public-Private-
Partnerships and community law on public contracts and concessions”,
COM(2004)327, European Commission, Brussels.
Commission of the European Communities (2005), “Report on the public consultation on
the green paper on Public-Private-Partnerships and community law on public
contracts and concessions”, SEC(2004)629, Commission Staff Working Paper,
European Commission, Brussels.
Commission of the European Communities (2003), “Public finances in EMU - 2003”,
COM(2003)283, Communication from the Commission to the Council and the
European Parliament, European Commission, Brussels.
European Commission (2000), “Commission interpretative communication on
concessions under community law”, 2000/C, 121/02, Directorate-General for
Competition.
European Commission (2003), “Guidelines for Successful Public-Private-Partnerships”,
Directorate-General for Regional Policy.
European Investment Bank (2004), “The EIB’s role in Public-Private-Partnerships”,
European Investment Bank.
Law (L.) 3389/2005 (2005), “Public Private Partnerships”
Lensink, R., Hermes, N. and Murinde, V. (2000), “Capital flight and political risk” Journal
of International Money and Finance, 19, 73-92.
Menheere, S.C.M. and Pollalis, S.N. (1996), “Case studies on Build-Operate-Transfer”
Rick Huijbregts, The Netherlands.
Wang, S.Q., Dulaimi, M.F., and Aguria, M.Y. (2004), “Risk management framework for
construction projects in developing countries” Journal of Construction Management
and Economics, 22, 237-52.
Wang, S.Q., Tiong R.L.K., Ting S.K. and Ashley D. (1999), “Political risks: Analysis of
key contract clauses in China’s BOT project” Journal of Construction Engineering and
Management, 125(3), 190-197.
Xenidis, Y. and Angelides D.C. (2005), “The Legal Risks in Build-Operate-Transfer
projects” Journal of Construction Research, 6(2), 273-292.

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AA/055
A Risk Assessment and Management Framework to Support Project
Delivery

Agyakwa-Baah, A. B.
(Postgraduate, Sheffield Hallam University, Sheffield, United Kingdom)

Chileshe, N.
(Senior Lecturer, University of South Australia, Adelaide, Australia)

Stephenson, P.
(Professor, Sheffield Hallam University, Sheffield, United Kingdom)

Abstract
Risk factors associated with construction projects have a major impact on issues
related to cost, time and quality of project delivery. Unexpected events result in
either positive or negative outcomes often causing deviations from project plans
and making construction projects particularly prone to risk. Despite the extensive
research on risk management in the construction industry, there is limited literature
dealing specifically with project risk in developing countries. It is against this
background that this study investigates the use of risk assessment and
management processes in organisations. Data were collected from construction
professionals working with construction clients (both private and public),
consultants, and contractor organisations within the Ghanaian construction sector.
The survey data were used to examine the differences in the levels of agreement
between the three stakeholders. The research findings indicated that although
project stakeholders are aware of risk factors associated with construction projects,
there is a need for the benefits of using risk management processes to be
emphasised and communicated. Based on the research findings a risk assessment
and management framework was established to support future successful delivery
of construction projects in developing countries.

Keywords
Risk assessment, risk management, developing countries

1 Introduction

In the current global competitive economy, managing various forms of risk is of

paramount importance to an organisation’s survival, Tah et al (2008). Additionally,
stakeholders including regulators, legislators, investors, customers and the public
are now demanding full accountability and effective controls. Proactive risk
assessment and sound risk management is therefore necessary to protect an
organisation’s competitive position and the successful completion of construction
projects.

This situation is undoubtedly more pronounced in developing countries, and may be

directly related to the demise of some construction companies in Ghana where
numerous construction projects fail to fulfil the expectations of users resulting in
project failures. Clients’ perceptions of delay in construction projects have revealed
that most of the causes of project delay which lead to cost overruns can be
avoided, or the impact substantially reduced, if risk assessment and management is
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carried out effectively throughout the project life cycle (Agyakwa-Baah, 2009). It is
therefore paramount that project managers, particularly in developing countries like
Ghana, consider risk assessment and management as an integral part of the
construction process.

2 Risk Assessment and Management

In risk management, one attempts to identify all possible foreseeable risks, and
assess the likelihood of occurrence and impact. Decisions can then be made on
how to manage risks by reducing their impact, or by avoiding them completely.
Moreover, the risk management process must not only involve identifying potential
risks but should include a formal planning activity. Estimates need to be made on
the likelihood of occurrence and predicted impact (RAMP, 2002). A monitoring
process should also be introduced to ensure that risks are reduced to the desired
level (Kerzner, 2006). It is important to note that although risk management aims
to ensure that risks are managed in the most effective way, it will not remove all
risks from a project (Mills, 2001). It is imperative to ensure that risk management
processes are made as simple as possible in order to remain manageable and
effective (Dallas, 2005).

3 Ghanaian Construction Industry

Over the past 10 years, construction in Ghana has greatly improved, albeit not to
expectations. The various sectors such as affordable housing, infrastructure and
transport, including road and rail, have received some, but limited, attention.
According to the External Aid Financing Performance Report, 2008, external aid,
which includes grants and concessional loans flow into Ghana, has averaged some
US$770 million between 2001 and 2007, registering its highest inflow of
US$1.1billion in 2005. The average revenue flows generally representing some 25%
of budget revenue and 6% of GDP.

In an effort to improve the Ghanaian economy and the government’s objective in

the Ghana Poverty Reduction Strategy (GPRS II) to promote the provision of basic
services, much investment has been made in infrastructural development. The
construction industry in Ghana, therefore, plays an important role within the
economy. However, despite the investment made, construction is still largely
inefficient as characterised by lengthy payment delays, cost and time overruns, and
poor project implementation. Moreover, many of these issues can be directly
attributed to risks not being managed effectively on the projects.

4 Aims and Research Methodology

The aims of the research were to investigate the implementation of risk

assessment and management practices in medium and large enterprises within the
Ghanaian Construction Industry, and to develop a framework that would facilitate
effective risk assessment and management practices. The research carried out
adopted a quantitative and qualitative approach involving both the administration of
questionnaires and interviews with construction professionals within the Ghanaian
construction sector.

The research focused on three categories of respondents within the industry. A

total of 180 questionnaires were administered to professionals working for
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contractors, consultants and clients with a resulting response rate of 57%.

Interviews were also arranged with 10 experienced professionals who were
randomly selected from a cross section of organisations. The interviews provided
useful information on the awareness of risk assessment and management
processes.

5 Development of Risk Assessment and Management Framework

In considering the practicality of a framework it was important to seek the opinions

from respondents as to whether they agreed that the development of a risk
assessment and management framework for the Ghanaian construction industry
would greatly influence projects outcomes. The majority of the respondents (i.e.
85% of contractors, 91% of consultants and 100% of clients), believed that there
was a need for a framework that could be effectively used by Ghanaian construction
organisations. This indicated that most respondents were supportive of
implementing a procedure that would guide them in carrying out the risk
management process.

The framework shown in Fig. 1 was developed based on information from literature
and research findings, together with information obtained on other approaches
used by construction organisations in the UK (Agyakwa-Baah, 2009). The
framework is composed of three major components which are; communication and
monitoring, risk assessment and management processes, and risk management
tools and techniques.

5.1 Communication and Monitoring

The results from the research indicate that team work and communication is critical
in the process of risk assessment and management. The management style used
will also have an effect on communication, and there is a need for effective
monitoring throughout the whole process, especially when risk management
measures are put in place.

5.2 Risk Assessment and Management Process

In utilising risk management, it is essential to identify all foreseeable risks, assess

the likelihood of their occurrence and impact, and then decide on how to manage
them, or avoid them completely. It is important to note that each project will
require a bespoke risk management approach and a plan that will fit its specific
requirements.

5.3 Risk Management Tools and Techniques

Throughout the risk management process, appropriate tools and techniques need to
be adopted. Some common techniques for risk identification would include:
influence diagrams, fault trees, cause and effect diagrams, in addition to checklists.
For risk assessment, tools and techniques would include: probability impact,
sensitivity analysis, Monte Carlo simulation, and Bayesian analysis. Additionally,
algorithms, mean end analysis, Bayesian theory and decision trees, amongst
others, are methods of decision analysis, which provide decision making tools for
use in uncertain environments. Other tools needed for the process include, prior
risk knowledge, decision support systems, qualitative and quantitative measures,
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and risk mitigation planning. Several software tools are also available for risk
management which can be used as part of the framework implementation.

The information required to carry out the process includes:

 Understanding of scope of work and site environment

 Client's planning supervisor's risk schedule
 Tendering team's risk schedule
 Subcontractors’ perception of risk
 Site team’s perception of risk
 Other stakeholders’ risk both known and perceived
 The tender, with contract programme.
The issues in applying the risk assessment and management practices in each of
the phases of Fig. 1 are addressed as follows:

Phase 1- Planning and Preparation

Organisation and Training - It is important for training to be organised which will
help in the awareness of the overall process. The tools and techniques to be used
need to be agreed at this stage.

Risk Management Plan - A risk management plan should be established to set out
the type, content and frequency of reports, the roles of risk owners and the
definition of the probability and impact criteria, covering time, cost, performance
and quality.

Process Plan and Control - The plan for the risk management process needs to be
drawn up so that it serves as a guide to control the process.

Phase 2- Risk Identification

Make a list all possible Risks - There is a need to make a list of all possible risks,
known or perceived. This can be achieved through brainstorming, using prompts or
lists, and historical records.

Identify Nature or Area - This refers to the nature of the risk and source of the risk.

Identify Owner of Risk - The owner of the risk can be the contractor, subcontractor,
client, or a third party.

Phase 3- Risk Assessment

Identify Probability and Impact - It is important to identify the earliest and latest
event dates.

Prioritise Risks - From the impact and probability of the risk, establish a rating e.g.
1-5 rating or high, medium and low risks.

Grade Priority – Select those that are high risk that needed immediate attention,
disregarding those that are low risk, which can be ignored.

More Detailed Analysis - For risk factors that need more detailed analysis, other
tools and methods such as Monte Carlo Simulation and Bayesian analysis may be
used.

Phase 4 - Risk Response/Management

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Assign Action for Priority Levels – establish appropriate actions related to the
priority levels of risk.

Assign Levels of Authority – establish levels of accountability and authority to

individual staff.

Ensure Risk Allowance in Cost Plan – Appropriate risk allowances must be included
with cost plans.

Establish Control Measures/Actions – Identifiable control measures and actions to

be established as appropriate.

Communicate measures to Risk Owners – All aspects of risk associated with the
project should be communicated to appropriate risk owners.

Phase 5 - Monitoring and Control

Assess Risk Status – the status of risk level to occur must be assessed before its
impact is experienced.

Assess Control Measures – establish appropriate control measures appropriate to

the status of risk occurrence.

Elapsing of Event Time – constant monitoring of risk throughout its period of

occurrence until the event time has elapsed.

New Risk Identification - New risks identified would have to go through the whole
process. If the control measures adopted for any of the risk factors is not effective,
these will need re-assessment.

6 Implementing Risk Management Measures

A critical evaluation of risk factors in the research led to the development of

possible risk management measures that can be applied to Fig. 2. in order to
manage indentified risk. The risk factors were placed under groupings: Stage 1: All
stages, Stage 2: Planning & Design, Stage 3: Construction.

For example in Stage 1: All stages, risk factors include: change of government,
change in government policy, poor communication amongst the project team, lack
of commitment, local laws, and quality and performance control.

Corresponding risk management measures include: obtain insurance for political

risks, adopt effective quality control procedures, review risk management processes
with all project team members, review project plans with all stakeholders, and
adopt a non-adversarial procurement strategy and form of contract.

Risk factors and corresponding risk management measures were also established
for stage 2 and stage 3.

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Planning and Preparation

Process Preparation

Organisation & Risk Management Plan Process Plan &

Training Control

R
I
Risk Identification S
K
Identify Risk at Workshop or Meeting
C
O M
M Make list of Identify nature or area Identify owner A
M possible Risks of Risk N
U A
N G
I E
C M
A E
T Risk Assessment N
I T
O
Assess Risk
N
T
Identify prob. Prioritise Risk Grade priority More detailed O
& & impact analysis O
L
S
M
O
N &
I Risk Response/Management
T
O Manage/Respond to Risk T
R E
I C
Assign action Assign levels Ensure Establish Communicate
N H
for priority level of authority risk control measures to
G N
allowance measures/ risk owners
I
in cost actions Q
plan
U
E
S

Monitoring & Control

Regular Review

Assess risk Assess control Elapsing of New risk

status measures event time identification

Fig. 1: Risk Assessment and Management Framework

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  Is it  
  necessary to
Checklist, No Yes
  identify
Brainstorm, Influence
relationships
  etc   of
  risk Diagrams,
factors? Fault tree
  Analysis,
Identify and group risk Cause/
 
factors that occur in each Effect
  stage of the project life Diagrams
cycle. e.g. Stage 1: All
   
Stages, Stage 2 Planning
  & Design, and Stage 3
Construction Seek Expert
  advice

 
Identify risk management
  measures assigned to the
various risk factors in the
  various phases
 

  Is the
 Yes
risk is in Implement risk management
Stage 1?
  measures that apply

 
No
 

 
Is the Yes
risk is in Implement risk management
 
Stage 2?  measures that apply
 

   
No

Implement risk management

  measures that apply

Fig. 2: Risk Assessment and Management Framework (Manage Identified Risks)

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7 Conclusion

The study into risk assessment and management in the Ghanaian construction
industry has revealed that there is a need for construction organisations as well as
project stakeholders to be made aware of the benefits of using risk management
processes. The research findings show that the majority of respondents believed
that there is a need for the development of a risk assessment and management
framework that can be used efficiently and effectively. Construction organisations in
Ghana need to organise and deliver training programmes on risk management in
order to equip staff with the tools and techniques they will need in managing
projects. The use of such tools within a risk assessment and management
framework will be an essential requirement to avoid cost and time overruns, and
support future project delivery.

8 References

Agyakwa-Baah, A. B. (2009), “A Study into Risk Assessment and Management

Practices within the Ghanaian Medium and Large Organisations”, Unpublished
MSc Dissertation, Sheffield Hallam University.
Dallas, M. F. (2005), “Value and Risk Management: A Guide to Best Practice”,
Blackwell and Davis Langdon.
Half Year External Aid Financing Performance Report (2008), Ministry of Finance
and Economic Planning, Republic of Ghana.
Kerzner, H. (2006), “Project Management: A Systems Approach to Planning,
Scheduling and Controlling”, (5th edition), Van Nostrand Reinhold.
Mills, A. (2001), “A Systematic Approach to Risk Management for Construction”,
Structural Survey, 19(5), 245-252.
RAMP (2002), “Risk Analysis and Management for Projects”, Thomas Telford
Publishing.
Tah, J. et al (2008), “Conceptual Information Modelling for Risk Analysis and
Management in an nD Modelling Environment”, The Built and Human
Environment Review, Vol. 1, 1-5.

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AA086
Critical Success Factors for Risk Assessment and Management
Processes Implementation: Perceptions of Construction
Professionals in Ghana

Agyakwa-Baah, A.
(Postgraduate, Sheffield Hallam University, Sheffield, United Kingdom)

Chileshe, N.
(Senior Lecturer, Research Education Portfolio Leader, University of South Australia,
Adelaide, Australia)

Stephenson, P.
(Professor, Sheffield Hallam University, Sheffield, United Kingdom)

Abstract
Despite the extensive research on risk management in the construction industry,
there is limited literature dealing specifically with the identification of critical
success factors necessary for the deployment of risk assessment and management
processes in developing countries. It is against this background that this study
attempts to elicit the perception of construction professionals on CSFs appertaining
to risk assessment and management processes within the Ghanaian construction
industry. Data was collected from 34 contractors, 46 consultants, and 23 clients
(private and public) within the Ghanaian construction industry. Response data was
subjected to descriptive statistics and subsequently analysis of variance (ANOVA)
and other non-parametric tests were used to examine the differences in the
identification of the critical success factors. The research findings indicated that
among the critical success factors, ‘Management style’ and ‘team work and
communications’ were ranked as the most important whereas ‘goals and objectives
of the organisations’ and ‘customer requirements’ were considered to be the least
important. There was a disparity of the ranking of the 10 critical success factors
among the groups; however the differences were not statistically significant. The
study also established a number of managerial implications in that the identified
critical success factors could be used as a ‘road map’ for the successful
implementation of risk assessment and management processes in developing
countries.
Keywords
Construction industry, Critical success factors, risk management, developing
countries

1. Introduction

The Construction industry in Ghana has been growing steadily over the years. The
Government’s objective in the Ghana Poverty Reduction Strategy (GPRS II) to
promote urban infrastructure development and the provision of basic services
including increased access to safe, decent and affordable shelter has given the
industry a further boost. Ghana seeks to be the gateway to West Africa and the
champion of African excellence. The 2008 Budget Statement of Ghana projected the
Construction industry to grow by 11.0 percent, exceeding the 10.0 percent target
for the year. This statement attributes the growth to the increased road
construction and other infrastructural development throughout the country. The
Construction industry in Ghana has been growing steadily over the years. According
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to the World Bank (2003) report, the annual value of public procurement for goods,
works and consultant services represents about 10% of Ghana’s Gross Domestic
Product. Despite the noted contribution of the Ghanaian construction industry to
economic growth and development, it is still fraught with frequent cost overruns
and delays on a lot of projects. The above observation calls for the further
exploration into the possible implementation issues of risk assessment and
management techniques on construction projects executed in Ghana. For example,
how many construction organisations in Ghana currently implement risk
assessment and management techniques? If there are, what are the critical success
factors to the deployment of RAMP? Can the level of RAMP deployment be
assessed? Thus, based on the analysis of past research, the main objectives of this
paper are as follows:

(1) To identify the critical success factors of RAMP in the Ghanian construction
sector; and (2) To examine whether differences exist in the perceptions of the
critical success factors by the construction professionals working with the 3 groups
of respondents (clients, contractors and consultants).

2. Literature Review on Critical Success Factors

Rochart (1979 cited in Chen 1999) was first to define the concept of critical success
factors. These were defined as “the limited number of areas in which results, if
they are satisfactory, will ensure successful competitive performance for the
organization”. Oakland (1995 cited in Salaheldin, 2009) defined CSFs as the critical
areas which organizations must accomplish to achieve its mission by examination
and categorization of their impacts. The importance of csfs has also been
highlighted by Johnson and Scholes (1999) through acknowledging that one of the
major shortcomings of strategy implementation in organisations is a failure to
translate statements of strategic purpose. Within the concept of benchmarking,
Deros et al., (2006) defined CSFs as a range of enablers which, when put into
practice will enhance the chance for successful benchmarking implementation and
adoption in an organization. Drawing heaving on Deros et al., (2006) definition of
CSFs, within the context of this study, are defined as drivers or enablers for
successful risk assessment and management practices implementation. Several
studies have examined the antecedents to risk management practices (e.g. Mok et
al.,1997; Akintoye and MacLeod, 1997; Frimpong et al., 2003; Abor, 2005; Ayirebi
Dansoh, 2005; Hassanein and Affify, 2007; Osburn, 2008; Luu et al., 2008).
Other studies such as Toor and Ogunlana (2009) have identified critical success
factors for large construction projects. The following section briefly describes some
of these studies and the critical success factors as adopted within this study.

Mok et al., (1997) observed that the successful implementation of risk management
process (RMP) depended on whether the critical success factors could be overcome.
The management style adopted in any organization will therefore go a long way to
affect the way risks are managed. Aje et al., (2009) identified contractor’s
management capability as one of the factors impacting on time and cost
performance of building projects.

Lack of awareness of risk management processes has been identified as leading to

poor resource management (Frimpong et al., 2003). According to Frimpong et al.,
(2003), project management tools and techniques play an important role in the
effective management of a project. Dada and Jagboro (2007) examined the impact
of risk on project cost overrun in the Nigerian construction industry and identified
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

improper assessment of risk factors as a contributory factor to ineffective project

delivery. Manelele and Muya (2008) also found lack of technical advice as one of
the project initiation risks affecting community based projects in Zambia.
Hassanein and Affify (2007) evaluated the risks relevant to construction contracts
among Egyptian international and local contractors and found limited project
management experience among the local contractors as one of the barriers to the
identification of risks. Some of the earlier studies such as Akintoye and MacLeod
(1997) also identified lack of familiarity with the techniques as one of the reasons
provided by contractors for not using techniques of risk analysis and management.

Co-operative culture can be defined as an environment where team members are

able to work or act together or jointly for a common purpose or benefit. Osburn
(2008) assert that cooperate culture has the potential to make the organization
more than the sum of its parts. By inference, an organisation where co-operate
culture was weak was bound to be ineffective. Lack of communication amongst
team members is in itself a risk factor as observed by Tchankova (2002), that
changes in people’s values, human behaviour and state of social structure are
another source of risk. According to Carter (1986), the parties within the
construction industry represent different professions and their multidisciplinary
skills limit the scope of co-operation between them. Projects rely on clients,
consultants, contractors amongst other stakeholders. Lester (2007) acknowledged
that relationships to the project by stakeholders can vary from being very
supportive to antagonistic but added that this needs to be managed effectively so
that it does not have any effect on the project. It is essential that for each project,
communication and team work is encouraged.

The “customer requirement” as a critical success factor can be argued to be closely

aligned with the “goals and objectives of the organisation”. Using the definition as
provided by Powell (1995), customer requirements or ‘customer focus’ is the
determination of customers (both inside and outside the organisation)
requirements, and then meeting those requirements no matter what it takes. The
need for understanding customer requirements was also highlighted by Nguyen et
al. (2004). “Consideration of external and internal environment” can be viewed as
part of the strategic planning which involves auditing of the external environment.
The importance of strategic management has also been highlighted by several
studies (Tummala and Burchett, 1999; Assibey Mensah, 2008; Ayirebi Dansoh,
2005; Luu et al., 2008). For example, Ayirebi Dansoh (2005) observed that the
operating environment for construction firms in Ghana is constantly changing in the
face of a volatile economic environment, shifting political climate and a highly
competitive market. Similar studies such as (Ahmed et al., 2007; Hlaing et al.,
2008) have also identified the linkages between the economy and procurement
methods.

3. Research Methodology

To identify the critical success factors of risk assessment and management

practices implementation within the Ghanaian construction sector, the following
specific methodology of this study based on literature review, a pilot study and a
question survey was employed to ensure a robust methodological design (Edwards
and Holt, 2010).

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3.1 Sample
This study issued 180 questionnaires to randomly selected professionals within the
Greater Accra region of Ghana. The list of all registered construction related firms in
Ghana was obtained from the relevant ministries and professional bodies (Tulli et
al., 2007). A total of 103 useable questionnaires were returned, 34 (33 percent)
were from contractors, 46 (45 percent) were from consultants and 23 (22 percent)
from clients. This comprised a 54 percent response rate and was therefore deemed
adequate for the purpose of data analysis. Fitzgerald (2000 cited in Odyinka et al.,
2008) state that this is way above the norm of 20-30 percent response rate in most
postal questionnaire of the construction industry.

3.2 Measurement Instrument

The data collection instrument was a self-administered structured questionnaire.

The questionnaire was pre-tested by sending to randomly selected 20 professionals
within the Ghana construction industry via email survey in March/April 2009. Based
on the feedback, the questionnaire was modified. As observed by Forza (2002), the
choice of professionals for piloting was to test whether the questionnaire
accomplished the study objectives. Gill and Johnson (1991) also observe that
piloting is also necessary as it is very difficult to predict how respondents will
interpret and react to questions. The questionnaire was divided into four parts, as
follows: demographics, evaluation of risk survey, awareness of risk assessment and
management processes, and antecedents (critical success factors and barriers). The
first part (demographics) sought information pertaining to organisation size, type
of sector, years of service in construction industry and profession background. The
questionnaire used in this study was designed to identify and measure the critical
success factors and comprised ten items namely: (CSF1) management style;
(CSF2) awareness of risk management processes (CSF3) co-operative culture;
(CSF4) positive human dynamics; (CSF5) customer requirements; (CSF6) goals and
strategic objectives of the organisation; (CSF7) impact of environment; (CSF8)
usage of tools; (CSF9) team work and communication; and (CSF10) availability of
specialist risk management. These factors are drawn from the extensive literature
review as discussed in the preceding sections.

3.3 Statistical Methods

The primary focus of the study presented in this paper was to determine whether
differences existed in the perception of construction professionals on CSFs
appertaining to risk assessment and management practices. Statistical Package for
Social Sciences (SPSS) computer program version 17.0.0 was used to analyse the
data generated by the research questions. Analysis of Variance (ANOVA), and
separate independent t-test were used for the analysis. Therefore, the main
hypothesis proposed is:

Null hypothesis: H0: There is insignificant differences in the perception among

construction professionals working for the clients, consultants and contractors with
regards to the critical success factors for risk assessment and management
processes.

Alternative hypothesis: H1: There are significant differences in the perception

among the construction professionals working for clients, consultants and

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contractors with regards to the critical success factors for risk assessment and
management processes.

4. Survey Findings and Discussion

Table 1 provides background of research respondents.
Position Frequency % Cumulative %
Quantity Surveyor 32 31.07 31.07
Engineer 33 32.03 63.10
Project Manager 22 21.36 84.46
Architects 11 10.68 95.14
Site Managers 5 4.86 100.0
Table 1.0: Positions held by respondents
Table 1 shows that more than half of the respondents were quantity surveyors and
engineers. The majority (56 percent) of the respondents have more than five years
experience in the construction industry. A total of twenty five percent of the
respondents work for organisations having more than 300 employees and only 17%
had less than 25 employees. The rest (58%) had more than 25 and less than 300
employees. This confirms that organisations were drawn from medium and large
organisations are per classification of the Ghanaian Statistics Service (GSC). The
respondents were asked to rate these critical success factors on a four-point scale
from “strongly disagree” = 1 to “strongly agree” = 4. Thus using the criticality cut
off point of 2.40, represented agreement levels. The reliability and internal
consistency of the survey instrument comprising the 10 critical success factors
items found in Table 2 was examined using the cronbach’s alphas coefficient. The
Cronbach’s Alpha value was 0.840 (F-statistic = 5.379, Sig. = 0.000) alpha greater
than 0.7 thus indicating a high reliability of scales (Nunnally, 1978).

4.1 Overall ranking of critical success factors

Table 2.0 shows overall ratings of CSFs with respect to the sample as well as group
wise. For the contractors, the means ranged between 3.15 (csf3 = co-operate
culture) and 3.52 (csf9 = team work and communication); for clients between 3.08
(customer requirement) and 3.44 (csf9 = team work and communication); and
finally for consultants, between 3.00 (csf3 = co-operate culture) and 3.50 (csf1 =
management style). Based on the data presented in Table 2, it is clear that all the
critical success factors were deemed to be important as they scored above the 2.40
cut off point. However, examination of Table 2 indicates that there was a disparity
in the ranking of the factors by the construction professions working the three
different types of organisations. The top three critical success factors according to
the professions working for contractors were as follows: “csf9 =team work and
communication” (mean = 3.52); “csf10 = availablity of specialist risk management
consultants” (mean = 3.39); and “csf8 = effective use of methods and tools” (mean
= 3.36). The clients also ranked “csf9 =team work and communication” (mean =
3.44) highly, followed by “csf1 = management style” (mean = 3.41); and “csf2
=awareness of risk management processes” (mean = 3.34). On the other hand, the
consultants viewed “csf1 = management style” (mean = 3.50) as critical followed
by “csf9 =team work and communication” (mean = 3.37); and “csf2 =awareness of
risk management processes” (mean = 3.37).

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Overall ANOVA Contractors Clients Consultants

R CSFs (N=33) (N=23) (N = 46)
MS1 F-value Sig MS1 R2 MS1 R2 MS1 R2
1 2 3 4 5 6 7 8 9 10 11
2 CSF1 3.41 1.105 .335 3.30 4 3.41 2 3.50 1
3 CSF2 3.34 .099 .906 3.30 5 3.34 3 3.37 3
9 CSF3 3.11 1.551 .217 3.15 10 3.11 9 3.00 10
6 CSF4 3.23 .722 .488 3.24 7 3.23 6 3.15 6
10 CSF5 3.08 .299 .742 3.15 9 3.08 10 3.04 7
7 CSF6 3.22 .656 .521 3.27 6 3.22 7 3.24 5
8 CSF7 3.17 2.137 .123 3.24 7 3.17 8 3.02 9
4 CSF8 3.30 .301 .741 3.36 3 3.30 4 3.26 4
1 CSF9 3.44 .604 .548 3.52 1 3.44 1 3.37 2
5 CSF10 3.24 2.976 .056 3.39 2 3.24 5 3.04 8
Notes: 1The mean score (MS) based on participants levels of agreement on the agreement level of a scale of 4 =
strongly agree, 3 = agree, 2 = disagree, and 1 = strongly disagree ; 2R = Ranking

Table 2: Overall sample and group-wise rating of CSFs.

Overall the research findings indicate that the csf of “team work and
communication” as important. This finding is in line with several researchers
(Tchankova, 2002; Lester, 2007). In order to confirm and ascertain whether there
were any significant differences in the rankings of the critical success factors by the
three groups, using a similar approach as adopted by Yang et al., (2008). Kendall’s
coefficient of concordance (W) was conducted and the results showed that the
spearman rank correlation coefficients (rho) of different pairs of respondents, i.e.
rho was 0.673 between the respondents from contractors and consultant
organisations. These statistical results indicate a general consensus on the ranking
of the critical success factors among the different group of respondents.

4.2 Differences in ranking of critical success factors

To investigate whether construction professions working for the three different

types of organisation had significant differences in the perceptions of the critical
success factors, ANOVA was performed with the significance level set at 5 percent.
The results are shown in Table 2. Although the results indicates no statistical
differences of opinion in the perception of the different types of organisations for
the csfs to risk assessment and management processes, however it is evident that
there was a disparity in the ranking of the critical success factors. This suggests
that construction professionals within the Ghanaian construction industry,
irrespective of the sector (clients, consultants or contractors) that they worked for
generally have similar opinions regarding the critical success factors influencing the
deployment of RAMP. As such, the null hypothesis of no significant difference in the
perception of different types of organisations to the critical success factors to RAMP
is upheld.

5. Limitations, Conclusions and Future Research

This paper presented part of the MSc dissertation study which sought to identify the
critical success factors of risk assessment and management practices (RAMP)
deployment among the MLE’s within the Ghanaian construction sector. This
involved a questionnaire survey of clients (or owners), contractors and consultants
involved with construction projects. Key findings from the survey include the

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observation that the most important factors for implementing risk assessment and
management practices within Ghanaian construction organisations were; team work
and communication; management style; and awareness of risk management
processes; and the level of risk assessment implementation in Ghana was medium.
One of the main contributions of this study is identifying an ordered and grouped
set of CSFs for risk assessment and management practices for construction projects
in Ghana. Another significant contribution of this paper is that it sheds light on the
understanding of critical success factors necessary for the implementation of risk
assessment and management practices (RAMP) within the Ghanaian construction
sector, an area previously under-researched. It also expands the effort of studying
and evaluating critical success factors across the developing economies and
particularly within the African context.

6. References

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Forza, C. (2002), “Survey research in operations management: a process-based
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Hassanein, AMR A.G. and Afify, Halaa M.F. (2007), “Risk management practices of
contractors: A case study of power station projects in Egypt”, Journal of
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Hlaing, N.N., Singh, D., Tiong, R.L.K. and Ehrlich, M. (2008), “Perceptions of
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Johnson, G. and Scholes, K. (1999), “Exploring Corporate Strategy”, 5th Edn.,
Prentice Hall Europe.
Lester, A. (2007), “Project Management, Planning and Control”, 5th ed. Elsevier Ltd.
Luu, T., Kim, S., Cao, H. and Park, Y. (2008), “Performance measurement of
construction firms in developing countries”, Construction Management and
Economics, 26, 373-386.
Manelele, I. and Muya, M. (2008), “Risk Identification on Community-Based
Construction Projects in Zambia”, Journal of Construction, 12(1), 2-7.
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benefits of risk management process in building services cost estimation”,
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Nunnally, J., (1978), Psychometric Theory, 2nd ed., McGraw-Hill, New York, NY.
Nguyen, L.D., Ogunlana, S.O. and Lan, D.T.X. (2004), “A Study on project success
factors in large construction projects in Vietnam”, Engineering, Construction
and Architectural Management, 11(6), 404-413.
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Property and Construction, 13(1), 5-17.
Osburn, C.B. (2008), “Corporate culture and the individual in perspective”,
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Powell, T.C. (1995) “Total Quality Management as competitive advantage: a review
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Developing Economy the Case of Sri Lanka”, Construction Management and
Economics, 26, 499- 506, Routledge.
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impact on performance of SMEs”, International Journal of Productivity and
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Environmental Management and Health, 13(3), 290- 297, MCB University Press.
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critical success factors for large-scale construction projects”, Construction
Innovation, 9(2). 149-167.
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AA080
Management of Communication Risks:
Evidence from international projects case study

Shaghayegh Aldaghi
(Royal Institute of Technology (KTH), Stockholm, Sweden)

Sviatlana Anop
(Research engineer, Royal Instritute of Technology (KTH), Stockholm, Sweden)

Abstract
The realization of project requires collaboration between many different
participants. The majority of interactions happen on the project management team
level. The general believe is that teams/groups can achieve more efficiency if they
use effective instruments of risk management in their communication process. The
aim of this study is to investigate how the level of communication risks varies
between different project group development stages and how project manager can
help project group to reach the maximum effectiveness of communication. The
study analyzes different communication barriers that project group meets while
working at project. The investigation was performed by using qualitative analysis
method in four different projects of an engineering and consulting company
involved with mining industries in South Africa. Interpersonal relationships were
measured by FIRO model and communication risks were evaluated by a typical risk
analysis method. Results of investigations show that communication risks are
directly affected by the stage of group development and different factors of group
development tend to synchronize with each other. The total amount of risks tends
to decrease as group moves from one stage to another on the FIRO model. For
improving communication process in project groups the dynamic nature of FIRO
model should be considered. The risks will not be settled down unless the group
stands in “Openness” stage and the group development stage is vulnerable to any
changes; the environmental effects should be carefully followed for preventive
action.

Keywords:
Project risk management, Communication, FIRO model, Group development

1. Introduction

Risk management is considered as the identification, assessment, and prioritization

of risks followed by coordinated and economical application of resources to
minimize, monitor, and control the probability and/or impact of unfortunate events
or to maximize the realization of opportunities (Hubbard (2009)). Managing risks on
projects is important factor affecting the successful reaching of project goals.
Nowadays risk management has become ‘‘an integral part of project management”
(Olsson (2007)).

Working groups have different challenges during their project work. The group
members should pass different stages to become an effective group or a team.
Although each group may face different difficulties during project lifecycle, there
are some challenges that are related to the group development stage and getting
familiar with them helps to prevent/overcome these difficulties. That is why it is

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important to investigate the effects of risks in communication that frequently occurs

between team members in international projects.

The aim of this study is to investigate how the level of communication risks varies
between different project group development stages and how project manager can
help project group to reach the maximum effectiveness of communication. The
investigation is focused only on communication processes that occur within the
project group and does not cover communication with other stakeholders.

One can find a lot of discussions underlining to the importance of communication

management in international projects, but researches in this area are limited. This
paper is the novel attempt to unite existing group development theory with risk
management tools and to investigate whether the relationship exist between them,
more specifically to investigate in what way they are connected in the area of
project communications. That is why the result of this study can be considered as a
relevant contribution to communication risk management science.

2. Literature review

Resent studies in the area of project management indicate that geographical zone
and cultural differences affect communications and team relations on projects. Lee-
Kelley and Sankey (2008) in their study consider a number of issues that team
members often encountered while working on projects. For example, lack of
communication can lead to confusion that can add more cost and more time,
misunderstandings are expensive in terms of time and resources and they also
create bad feeling within a team. We have summarized most important
communication barriers that can be met in project work:

Unclear message (Jensen (2001)); contradicting message (Stoner (1995));

complicated language (Robbins (2002)); absence of feedback (Schermerhorn, Hunt,
& Osborn (2002)); Robbins (2002)); language characteristics (Schermerhorn
(1999)); time pressure (Jensen (2001)); failure to recognize nonverbal signals
(Schermerhorn, Management (1999)); Inability to communicate (Jensen (2001));
cultural differences (Schermerhorn, Management (1999)); organizational culture
(Stoner (1995)); status Effect (Schermerhorn (1999)); filtering (Robbins (2002));
withholding information (Jensen (2001)); partial information (Jensen (2001));
hidden agenda (Jensen (2001)); indirect communication (Jensen (2001));
perception and stereotyping (Schermerhorn (1999)); Lack of trust / incredibility
(Stoner (1995)); emotions (Robbins (2002)); defensiveness (Robbins (2002)); poor
choice of channel (Schermerhorn (1999)); information overload (Robbins (2002)).

To study the relationship of the group members and different challenges which exist
in each stage, we use FIRO model (Fundamental Interpersonal Relation
Orientation), introduced by William C. Schutz in 1958 as a theory of interpersonal
behavior. This model describes a team’s development in the following three phases:

1. Inclusion. The team is formed and the members get to know each other
during the Inclusion phase. The project manager maps out the objectives of
the project, which have to be achieved by the team.
2. Control. The project manager identifies each team members’ values during
this phase. This phase satisfies the members’ social need or individual
attention and their sense of contributing to the overall project.
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3. Openness. By this phase the team is working well and strong group identity
has developed. An atmosphere of openness has developed within the team.
In the last phase the group becomes highly efficient. All teams are not
progress to the Openness phase. When changes in personnel occur in the
team, it is common for it to take one or more steps backwards in its
development.

3. Research method

Research method is based on qualitative case study analysis. To ensure the

reliability of the paper, the most reliable resources were considered for literature
review. To ensure the validity of the paper only the tested methods were applied.
The risk analysis matrix for example was constructed in a similar way that the one
used in the research for South African Air force before (Jensen (2001)). Also the
cases were selected within four projects of a company to unify organizational
culture and policy. Sometimes a specific person involved in more than one project
was investigated for different projects to emphasize on the role of the individuals
within a group.

After thorough literature review we have created a list of common risk

communication related factors described above and formulated a number of survey
questions for face-to-face interviews of project managers and project team
members. Three different phrases were placed at the top of the page indicating the
three different stages of FIRO to let the interviewee choose their current state.
Using this data enabled us to find out the perspective of the interviewees about
their stage of group development. It should be considered that this data was not
the basis to judge the project group development stage but it enable us to find out
whether the project members are aware of their stage of group development. To
identify and evaluate the scale of the communication risks, the perception of
project members in this approach was measured (Chicken (1996)) and to collect
their opinion regarding this approach, Dephi method was applied (Bilal (2001)). The
respondents were asked to evaluate different communication barriers they
encountered working on projects and also to evaluate the level of likelihood and the
level of impact of the identified barriers in their current situation to make the risk
analysis possible. This process was supposed to be three times for three existing
stages of group development based on FIRO model. The result analysis was aligned
with risk matrix (Heldman( 2005)).

Totally twenty eight estimation were collected from a group of fourteen people. The
interviewees were from different nations and different races according to the nature
of the country.

4. Data collecting

The main process of data collection was performed during May to August 2009 in
South Africa in four different project of an engineering and consulting company
involved with mining industries. As the paper is going to study the communication
related to the interpersonal relationship developed in the project groups, we have
assumed that the whole organization is working with four project groups; three
groups consist of the members of running projects and the forth project group
represents of higher levels of the permanent organization who set up the projects
and are involved working with the project managers.

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Case-1(Permanent Organization): In the higher levels of the permanent

organization, there are usually managers who have being working with each other
for a long term. As the project goes to new phases according to the project life
cycle, new project managers would be employed. The respondents’ estimation
regarding the group development degree was so different but over 70% of them
were aware of where they are standing

Case-2: Comparing to the other projects of the company, this project has a small
scale. The project group is consisting of the available human resources employed
by the company and if the project would be extended for further works, new people
would be employed according to the requirements. Despite these people are
experiencing work in this group for the first time, they know each other from the
past. There are 10 people involved in this project of which some are not working
full time on that. The result of questionnaire indicates that the estimation of the
respondent about their group development stage is different from each other but
over 60% of the respondents were aware of their group development stage.

Case-3: This case is Engineering Procurement Construction Management project.

There were fifteen people at the time working in the project that has been started 6
months ago. Relations in this group used to be problematic as it is located in
another country. Despite CEO interfered to improve the situation, the project
climate did not seem to be stable; the project team faces so many changes that the
group development is not successful. The result of questionnaire indicates that only
28% of the respondents were aware of their group development scale.

Case-4: This is an Engineering Procurement Construction Management Project that

has been running about 15 months. As the project life cycle changed, new people
were employed and it brought changes for the project team. There are 25 people
working in this project from this company and new people are being employed.
Those experiencing a longer period of work in this project believe that they are in
phase 3 of FIRO but new comers evaluate it as phase 2. The result of questionnaire
indicates that only 40% were aware of their group development stage.

5. Results

According to the related theory by applying Median as a measure of central

tendency the best value among the expert cases for probability and impact are
found, and by applying risk matrix (Appendix 1) the values for risk assessment
would be achieved. The identified risks are classified in four classes of High,
Significant, Moderate and Low based on the severity. Appendix 2 shows the transfer
of each single risk in different stages of FIRO circle for each case.

Case-1: Despite the result of interview indicates that this group is standing in
Openness, according to the FIRO model, this stage implies high level of cooperation
and goal sharing; consequently, the likelihood of the barriers that might affect the
group goal or cooperation should be minimum to enable us conclude standing in
Openness. So according to the FIRO model this group is standing in Control stage.
In this situation we should consider that the level of risk is being shaped by two
factors of likelihood and impact; exploring the risk matrix makes it clear that
unlikely and rare Likelihoods –that are the expected likelihood values in Openness-
do not return the result of risk assessment as High (unless it is unlikely but the
impact would be catastrophic). In other words, while 36% of all the specified risks
are specified as high risks and the remaining 64% as the significant risks in FIRO
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first stage, this percentages change into 27% high risks and 73% significant risks in
the second stage and also 18% high risks, 36% significant risks, 36% moderate
risk and 5% low risks in the third stage (Appendix 2). Comparing the theory with
the results achieved in Openness emphasizes on the dynamic process of FIRO and
the importance of a precise group development measurement in finding the results.
In other words the high risks appeared in Openness dedicates the fact that the
result of high risk in this stage is due to a return to the previous stage of group
development and as the result the impact affecting the medium likelihood of the
barrier composed the high risk.

Case-2: The result of interview indicates that the members of this group have
different opinion about the stage that they are standing in. Although the group
members know each other well and some of them have experienced working in a
group with each other, it seems that they are not working as a team. They are not
facing plenty of problems with each other but many of them still think that they are
standing in the second stage of FIRO. The reason for this misjudgment is due to
changes occurred on the type of work they are doing. According to the FIRO model
this group is standing in Control. In this case we found that while 41% of all the
specified risks are specified as high risks and the remaining 59% as the significant
risks in FIRO first stage, this percentages change into 18% high risks, 68%
significant risks, 9% moderate risks and 5% low risks in the second stage and in
the third stage, they would be 5% high risks, 45% significant risks, 27% moderate
risk and 23% low risks (Appendix 2). The rate of changes shows that moving from
Inclusion to Control stage, the high risks are the most influenced group by the
changes and moving from Control to Openness stage the significant risks are the
most influenced. All the changes are in order to descend the severity of risks. Each
of the single risks had a descendent rate in their severity or remained unchanged
by moving from first stage of FIRO to the second stage and the third stage. Despite
the apparent results seems satisfactory, there is an unfavorable implication about
risk evaluation of Openness. It can be identified that there are quite many items
that the likelihood has been evaluated as Moderate or even Likely. It clarifies the
dynamic process of FIRO; so it can be concluded that the group would be shifted to
previous stages by evaluating this likelihood for the barrier.

Case-3: The result of interview indicates that most of the group members do not
have a clear understanding of the current stage that they are standing in. Working
in distance makes it difficult to have close relationships and frequent changes on
arrangement and also some unclear procedures running in this group makes the
situation harder. According to FIRO model this group is standing in Inclusion.
Studying the rate of change of severity of these risks in different stages of FIRO
shows that while 44% of all the specified risks are specified as high risks and the
remaining 55% as the significant risks in FIRO first stage, this percentages change
into 14% high risks and 82% significant risks and 5% moderate risks in the second
stage while there would be no residual high risks in the third stage but 36%
significant risks, 27% moderate risk and 27% low risks in the third stage (Appendix
2). The rate of changes shows that moving from Inclusion to Control stage, the
high risks are the most influenced group the by the changes and moving from
Control to Openness stage the significant risks are the most influenced. All the
changes are in order to descend the severity of the risks. Each of the single risks
had a descendent rate in their severity or remained unchanged by moving from first
stage of FIRO to the second stage and third stage. In this case, Large risks reside
in Openness are not due to the likely/moderate likelihood but they are caused by
high level of impact evaluated for them. However, the moderate likelihoods for
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different single risks make doubt about the stability of different stages of FIRO
during risk evaluation.

Case-4: Although the result of the questionnaire shows that most of this group
members believe that they are standing in Openness and despite the steady and
calm climate of the project, this is an overestimation. By the start of the new phase
of activities, new members were employed in the group. Now the group is standing
in the second stage of FIRO: Inclusion. Results indicate that while 32% of all the
specified risks are specified as high risks and the remaining 68% as the significant
risks in FIRO first stage, this percentages change into 14% high risks, 73%
significant risks and 14% moderate risks in the second stage and in the third stage
there would be no high risks but only 50% significant risks, 23% moderate risk and
27% low risks (Appendix 2). The rate of changes shows that when moving from
Inclusion to Control stage high risks are the most influenced and when moving from
Control to Openness stage significant risks are the most influenced. All changes are
in order to descend the severity of risks. Each of single risks had a descendent rate
in their severity or remained unchanged by moving from first stage of FIRO to the
second stage and the third stage. The same as the previous cases, there are some
items of barrier that the likelihood has been evaluated as Moderate. It makes the
dynamic process of FIRO more clear and it can be concluded that the group would
be shifted to previous stages by evaluating this likelihood for the barrier. In this
case also the time pressure barrier that have been identified as likely to happen in
Openness is a matter of environment that regardless of relationship running in the
group is related to managerial aspect and sometimes external environment of the
project.

6. Conclusion

Although the result of cases is different from each other, they are following a
similar trend:

 Each of risk items has a descendent rate in the severity or remains

unchanged by developing from Inclusion to Control and Openness in FIRO.
 The density of high risks decreases when moving from Inclusion to Control
and Openness in FIRO.
 The density of significant risks increases when moving from Inclusion to
Control in FIRO, but it sharply decreases when moving to Openness.
 The density of moderate risks and low risks increases when moving from
Inclusion to Control and Openness.

This implies that residual risks of communication are directly affected by the scale
of interpersonal relationship among the group members. To decrease the residual
risks to the minimum amount, project manager should try to lead the group into
the next stage of the FIRO model and try to be aware of situational symptoms of
stepping back into previous stage. It should be considered that the group is
frequently in back and forward movements but the project manager can manage to
shift the group in a specific stage of group development based on the applicable
risk management tools and leadership skills. More over there are frequent changes
in group development stages and it should be remarked that sometimes group
members do not have a clear understanding of their group environment, their
relation and the group stage. The changes within the stage of the group can be
predicted by analyzing the internal and environmental situations.

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References

Benator, B. and Thumann, A. (2003), “Project Management & Leadership skills for
engineering & Construction projects”, Fairmont Press Inc.
Bilal, M. (2001), “Elicitation of expert opinion for uncertainty and risk”, CRC Press.
Drucker, P.F. (2001), “The essential drucker”, Harper Collins Publisher.
Doherty, W.J. and Colangelo, N. (1984), “The family FIRO model: a modest
proposal model for organizing family treatment”, Journal of Material and family
therapy, 10(1), 19-29.
Chicken, J. C. (1996), “Risk Handbook”, International Thomson Business Press.
ISO/DIS 31000: Risk management — Principles and guidelines on implementation.
International Organization for Standardization.
Heldman, K. (2005), “Project Management Professional Study guide”, Willey
Publishing Inc.
Hubbard, D. (2009), “The Failure of Risk Management: Why It's Broken and How to
Fix It”, John Wiley & Sons.
Jensen, D.F. (2001), “An analysis of communication problems in project risk
management in South African Air Force”, University of Pretoria.
Lee-Kelley, L., and Sankey, T. (2008), “Global virtual teams for value creation and
project success: a case study”, International Journal of Project Management,
26, 51–62.
Olsson, R. (2007), “In search of opportunity management: is the risk management
process enough?”, International Journal of Project Management, 25, 745–752.
Olson, D.L., and Wu, D.D.(2008), “Enterprise Risk management”, World Scientific.
Rasiel, E.M., and Friga, P.M. (2002), ”The MCKinsey Mind”, McGraw-Hill Companies
Richman, L.(2002), “Project management Step by step”, American Management
Association.
Robbins, S.P., and Coulter, M. (2004), “Management”, Printice Hall.
Schermerhorn Jr., J.R. (2009), “Management”, John Willey & Sons.
Schermerhorn Jr., J.R., Hunt, J.G., and Osborn, R.N.(2002), “Organizational
behavior” (7th edition), John Wiley & Sons.
Schutz, W. (1994), ”Den goda organizationen. The Human element”, (Swedish ed.),
Natur och kultur.
Stoner, J. (1995), ”A. F. Managemment”, Printice Hall.
Wenger, A., Mauer, V., and Dunn Cavelty, M. (2008), “Iternational handbook on
risk analysis and management”, Center for Security Studies.
Westerberg, S.M. (2007), “How diversity influences the work process in
Cooperation projects”, Master thesis in Blekinge Institute of technology.

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Appendix 1

Consequences 1 (Incignificant) 2 (Minor) 3 (Moderate) 4 (Major) 5 (Catastrophic)

Likelihood
A (Almost certain) S S H H H
B (Likely) M S S H H
C (Moderate) L M S H H
D (Unlikely) L L M S H
E (Rare) L L M S S

Table 1: Risk matrix to assess the level of risk (Jensen (2001))

H: High risks that require detail research and planning by senior managers
S: Significant risks that require attention of senior managers
M: Moderate risks that must be specified as the responsibility of management

Appendix 2

Case1(Permanent org) Case 2

Inclusin Inclusin

73% 80% 68%

100% 64% 80%
60%
50%
36% 60%
27%
100% 41% 59% 40% 18%
0% 0% 40% 50% 0% 0% 20% 9% 5%
0% 20% 0% 0% 0%
0% 0%

45%
40% 18%
36% 36%
Control
60%
40% 27% 23% Control
20% 5% 20% 5%
0% 0%

Openness
Openness

Case 3 Case 4

Inclusin Inclusin
100% 82
80% 73%
80% %
60% 45%55% 60% 14 60%
40% 40% 100% 68% 40%
% 5% 0% 32% 14% 14%
20% 0% 0% 20% 50% 0% 0% 20% 0%
0% 0% 0%
0%

36% 27% 27% 60% 50% Control

40% Control 40% 23% 27%
20% 0% 20% 0%
0% 0%

Openness Openness

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W010
Evaluation of the Standardised form of contract at Sultanate of
Oman

Aziz Al Rashdi
(PhD Student, School of the Built Environment, University of Salford, Salford,
United Kingdom)

Monty Sutrisna
(Director of Post Graduate Research Training, School of the Built Environment,
University of Salford, Salford, United Kingdom)

Abstract
The use of standardised forms of contracts has been generally considered practical
and economical in the construction industry. Originally produced in the 1980s, the
standardised form of construction contract for government works is the only
standard contract document available and recognised for public works in the
Sultanate of Oman. In Oman, government contracts for the construction of public
works are required by statuary law to be fixed-price contracts awarded through
competitive bidding. The standardised form of contract has never really been
reviewed and updated. Unfortunately, there is limited research in the Omani
construction industry particularly in the contractual management field. Based on
this, a PhD research has been set up intending to evaluate the use of the
standardised form of construction contract in Oman and to formulate
recommendations of necessary improvement to incorporate the contemporary and
future needs and trends in the Omani construction industry. This paper discusses
the background and rationale of conducting the research followed by the research
methodology applied in this study. The earlier stages findings are also presented
followed by discussion. The paper is concluded by summarising the progress and
findings so far as well as the further stages of this research guided by the findings.

Keywords
Clarity, Construction Law, Standardised form of Contract at Sultanate of Oman.

1. Introduction

The construction industry has generally been considered playing a powerful role in
sustaining economic growth and typically considered an important industry for
most countries. In many countries, it contributes to domestic economies as both a
large employer and as a sector of considerable economic value (Thompson, et al.
1998). Construction industry is normally a major source of jobs, making a large
contribution to the GDP and is a major purchaser of other sectors.

In many projects, the growth of construction industry with its inherent increased
complexity has resulted in higher number of claims. Claims are common in
construction projects and can happen as a result of several reason, that can
contribute to delaying projects or increasing there cost. For this reason, the well
drafted construction contracts should include some kind of clauses for addressing
disputes and claims at the germane stage in a project. This includes for instance,
clauses containing carried provisions and instructions for parties to resolve disputes

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as they arise, during the course of the project (Jannadia et al. 2000). Additionally
Broome and Perry(1995) extended the discussion by asserting that the clauses
within a contract should fit together to form a logical whole, be procedurally correct
and relevant to modern construction practice in distinguishing the factor affecting
the clarity of the standard forms of contract. A good construction contract should
include well drafted drawings and specifications that inform the contractors what he
must do to earn the promise compensation and provide a method of determining
whether the objective has been reached (Ibrahim and Madon, 2006).

At the Sultanate of Oman, the standardised form of construction contract (OSFC) is

the only standard contract document available for public works. The form of
contract was statued by the Ministry of Finance and National Economy of the
Sultanate of Oman in 1980s and has been used in the construction of all types of
public projects leading to the large industry projects. In line with the common ways
of working in the 1980’s for instance, the government contracts for the construction
of public works are required to be fixed-price contracts awarded through
competitive bidding. Over the years, the OSFC has never really been reviewed and
updated to keep up with the development and trend in the global and local Omani
construction industry.

Limited research in the field of standardised form of contract in the context of

Omani construction industry has necessitated further study on the matter.
Therefore this research intends to collect evidences of practices in OSFC and
provide directions for future study in the field. The main aim of the research is to
study the standard form of Omani contract, and to recommended frame work that
can be used to improve the OSFC and contracting practice in Oman.This study
provides a framework for comparing the contracting practices in the UK and in
Oman. It starts by reviewing previous studies on OFSC and two of the standard
form of contract, i.e. FIDIC standard of contract and NEC3 form of contract
practices and explores the main delivery methods, inform of comparison with
different aspects of contracting systems. It examines construction contracting
types, processes and procedures and interaction between the client and other
parties. This study was based on a literature review and the result shows the
similarities and differences between the NEC3, FIDIC and OSFC within each practice
and between both practices; the distribution of responsibilities and risks both in
pre-construction and during the construction stages; and allocation of responsibility
in both practices. The literature has show different aspects for each of standard
form of contract.

2. Standardised Form of Contract

2.1 Standardised Form of Contract Construction Industry.

The construction industry generally uses many types of contracts. Each one allows
responsibilities and risks to be allocated in various ways and integrate different
payment mechanism. Moreover, standardised form of contracts such as NEC are
progressively flexible in determining, for example , which party takes responsibility
for design, what performance incentives are adopted and how risks are to be
allocated (Stovin et al. 2004).

Contract is defined as an agreement between the parties in exchanging promises

giving them rights and duties bound by the law (Owen, 1998). In order to create a
legally binding contract, it is sufficient for the parties to express their agreement
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and intention. However, in order to avoid potential disputes, the contract terms
should be set out in writing in a document, subsequently signed by the parties,
which can be used as a legal-evidence (O’Reilly, 1999). A construction contract is
then made between two parties, the ‘Employer’ and the ‘Contractor’. Their roles are
defined clearly in the contract. However, there is normally a need for daily
supervision of the construction that the two parties may agree for a third party to
carry out such duties. The third party can be designated as ‘the Engineer’ under the
contract; or may be designated ‘the Project Manager’ or ‘Employer’s
Representative’ with different roles suitable for the project (Twort and Rees, 1995).

In creating a contract, in many cases, there is a necessity for contractual

arrangements to be entered into in one of the many standard forms of contracts
available (Capon, 1990). Standard forms of contracts are conditions of contracts
that have been prepared jointly by professional bodies and organisations to
distribute the risk fairly and equally to the parties (Abrahamson, 1985). The use of
standard forms of contract intends to ensure that all parties are familiar with the
terms as a result of common usage that reduces the likelihood of disputes arising
over the interpretation of the clauses. The parties are then aware of their rights and
obligations under the terms of the contracts that are well documented.

2.2 Standardised Form of contract at Sultanate of Oman

Construction contracts in Oman are usually set out from FIDIC forms of contracts.
The changes made by FIDIC to transform the ICE form to an international form of
standard contract can be considered insubstantial (Bunni, 1999). Oman's legal
system is based on civil code principles and in particular, the Egyptian Civil Code.
This has been citied the first legal issue with Oman Construction contracts (Mansour
and Al Sharji. 2008) as this contrasted by the general practice of directly
translating FIDIC into the Arabic language in some Arab countries in the contracts
and related documents, including in Oman (Arrowsmith et al. 2000).

In public sector, the OSFC drafted in 1980s is the only standardised form of
contract available. This OSFC consists of two parts. Part one is entitled ‘the
principal document of the contract’ and is composed of eight articles dealing with
matters similar to some of those generally stated in standard agreement and/or
bid forms of construction contracts. Part two is called ‘general conditions’ and is
composed of 61 clauses expressing terms and conditions similar to some of
those usually found in standard general conditions of those contracts (Ministry of
National Economy,2005). However OSFC has never really been reviewed and
updated. Thus, taking into account the vast development in the global local
(Omani) construction industry, there is a need to review/evaluate the OSFC and
recommending potential improvement to the OSFC to enable it accommodating or
even embracing current days needs characteristics of the Omani construction
industry.

2.3 Methods of Evaluating Standardised Form of Contract

There are many aspects to be considered in evaluating general conditions of
construction contracts, Abdulaziz et al. (2001) defined many aspects to be
considered to ensure the “smoother” completion of the construction process. The
general condition should anticipate the potential trouble spots of the relationship
between the contracting parties. The other aspect to be considered is the language
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which should be clear to the parties. The ‘workability’ of the rules prescribed in the
general conditions is related to this aspect. Responsibilities and fairness are other
important aspects: the general conditions should be fair to the contracting parties
whilst the best principle for allocating responsibility is that controllable risks should
lie with the party who is in control, In addition, the general conditions should
elevate the achievement of the more palpable dimensions of project success in
terms of cost, time, quality and safety. As a starting point, the OSFC has been
compared against other standardised form of contract (FIDIC and NEC) in this
research. This stage has been defined to capture updates that have been
implemented in another standardised form of contracts that reflect the current
situation and trends in the global construction industry.

3. Research Methodology
There is a strong suggestion within the research community that research, both
quantitative and qualitative, is best thought of as complementary and should
therefore be mixed in research of many kinds (Amaratunga et.al. 2001). Thus, the
combining of the research methods is intended to be complementary, i.e. adding
different dimensions to the research. In collecting data, the use of in depth
interview combined with a postal questionnaire are considered appropriate to
provide breadth and depth for the research. Moor (2000) discussed the technical
term for combining research methods in this way to provide a number of different
views on an issue is triangulation. It is useful to concept and one that it well worth
considering when designing projects as it adds consider-able value to the research
result. The link between the quantitative and qualitative methods enables the
transfer of idea from each other and provides richer details. It enables the idea to
be developed as well as initiating new lines of thinking and providing fresh insights.

Following an in depth literature review and archival study of construction law cases
in Oman and comparative analysis between OSFC and other standardised form of
contracts, the research intends to conduct semi structured interview and
questionnaire to facilitate data collection. As stated by Naoum (1998), this form of
interview uses’ open’ and ‘close-ended’ questioning but the questions are not asked
in a specific order and no schedule is used. Semi-structured questionnaire and
interview has been considered as the most appropriate technique for this research.
The independents targeted are Questionnaire survey designed to evaluate various
aspects of the standardised form clauses in the Sultanate of Oman. Thus
questionnaire survey will designed to identify best practice in Omani construction
sector in implementing the standardise contract clauses. On return of the
completed questionnaires, data analyses will be performed. After refinement of the
data, various stages of data analyses will be conducted. The analysis of the survey
results will be conducted using descriptive statistic tool, subsequent to this, follow
up will be by semi structured interviews will be conducted to further discusses as
well as the validating the finding.

4. Comparison Study Between OSFC, NEC3, and FIDIC

This part of this paper presents the findings of the comparison study between the
OSFC and two other standard form of contracts ex NEC3 and FIDIC form of
contracts. The OSFC standard forms are intended to be applicable to a wide variety
of types of work including building, civil engineering, mechanical and electrical
engineering and for major and minor works in the Sultanate of Oman. All
government-awarded construction and civil engineering contracts use a standard
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form of contract: the ‘Standard Documents for Building and Civil Engineering
Works’ (Fourth Edition, September 1999). The forms in fact are applicable more to
domestic civil engineering projects than building contracts. Ideally, substantial
amendment would be necessary to deal adequately with building contracts, where
the other standard forms may be more appropriate. Among various differences, two
major differences have been identified, namely the dispute management and
subcontracting.

In term of dispute management the OSFC contains terms that provide for disputes
not capable of resolution determination by the project’s engineer to be referred to
arbitration. The adoption of the standard form of contract in building projects
between private parties is widespread throughout Oman thus requiring any disputes
arising in relation thereto to be determined by way of arbitration also. The
arbitration process, and the interpretation of the agreement to arbitrate itself, is
governed by Sultani Decree 03/07, promulgating the Law of Arbitration in Civil and
Commercial Disputes (the Arbitration Law). Whereas in FIDIC the clause for
arbitration is one part of a comprehensive dispute resolution process in which at
several stages decisions will be made as to entitlement and/or quantum, including a
Dispute Resolution Board whose goal is to prevent the parties from engaging in an
arbitration.

NEC3 alternatively provides for a dispute to be referred to an adjudicator under

option W1 (W2 for the UK). Whatever reservations there may be about some
aspects of adjudication, there is now no doubt that decisions made by adjudicators
are generally either accepted by the parties or are used by them as the basis for an
agreement to settle the dispute finally. A party that is dissatisfied has the right to
take the resulting dispute to the tribunal (court or arbitrator as designated in the
contract data). That tribunal decides the dispute referred to it. It does not of course
act as an appellate tribunal but as a tribunal of first (and possibly last) instance
with the obligation to reach its own decision. However acceptance of an
adjudication decision may turn on the competence and experience of the
adjudicator, as the guidance notes explain. NEC3 provides for an adjudicator to be
named by the employer in the contract data. If an employer or its legal advisers are
concerned that a dispute might arise about a “tricky” legal point then a lawyer (or
someone with legal qualifications) whose ability is not in doubt should be selected.
It is impossible to guarantee that a legal point will be decided ‘correctly’—one has
only to look at the decisions of appellate courts in countries where the judges are
familiar with construction contracts Lloyd (2008).

In subcontracting term the FIDIC Conditions of Contract for Construction (Red

Book) do not permit the Contractor to subcontract the whole of the works. These
conditions of contract hold the Contractor responsible for the acts or defaults of any
of his domestic subcontractors as if they were the acts and defaults of the
Contractor himself. However the NEC3 Engineering and Construction Contract
(ECC) has been designed on the assumption that work may be subcontracted.
There is no provision for the nomination of subcontractors within the NEC contracts.
Provision for selected subcontractors may, however, be included in the Works
Information (scope of work). The principle of the ECC is that the Contractor is fully
responsible for every aspect of managing the work he has contracted for.
Nominating subcontractors conflicts with this principle and causes many practical
problems. On the other hand, the nomination of sub-contractors arises under clause
59 of OSFC conditions of contract whereby it refers to them being all the persons to
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whom, by virtue of the provisions of the contract, the contractors is required sub-
contract, and shall in the execution of such work or the supply of such goods,
materials, plant or services, be deemed to sub-subcontractor to the contractor, and
to refer to as nominated sub-contractor. The nomination process is prone to so
many problems as the contractor has the right to object to a ‘nominated sub-
contractor’, or to that who refuse to enter into a sub-contract which is back to back
with the main contract and which identifies the contractor in respect of the
nominated sub-contractor’s breaches. It is emphasised on no privacy of contract
between the employer and subcontractor. In summary of this term, Unacceptable
forms of subcontracts are those which contain provisions for payment procedures
based on a pay-when-paid, or pay-if-paid system; a right of set-off in favour of the
contractor not provided for in the law; authoritarian rights given to the prime
contractor, or his agent, with no recourse to independent adjudication in the event
of a dispute arising (CIDP Practice note, 2007). It can be concluded from this
discussion that OSFC has failed to incorporate alternative ways of procurement
such as construction management.

4. Conclusion and Further Research

The study conducted in this PhD research was instigated by construction contract
and contractual process in construction industry at the Sultanate of Oman. The
research intends to investigate the potential problems in using the dated standard
form of construction contract and recommend solutions. This research paper
outlined the proposed study, which illustrated the research justification,
significance, contribution drawn from previous literature from the developed and
developing countries. The report also presented an overview of the intended
research methodology.

At this point of writing, the research is in progress of performing a comparative

analysis between OSFC and other standard form of contracts i.e. NEC 3 and FIDIC.
The initial findings reported and discussed in this paper demonstrated that there
are 2 major differences between OSFC and the other two (updated) forms of
contract, namely the dispute management and the sub-contractor management.
The differences reflect the more contemporary needs of construction industry as
accommodated by NEC 3 and FIDIC which have been updated regularly.

Further research involve finishing the archival updated study on construction law
cases in Oman to identify the most common and contemporary contractual issues in
its construction industry. Combining the findings from construction law cases study
and general trend of construction industry in the recent time and in the future,
questionnaire will be distributed as well as follow up interviews to help the
researcher in formulating recommendations of necessary improvement to the OSFC
in order to incorporate the contemporary and future needs and trends in the Omani
construction industry. The recommendations from this research will be forwarded to
the decision makers in the Sultanate of Oman to inform them in improving Omani
construction industry.

5. References

Abdulaziz .A .B and Soliman. A .A (1994), Contract procurement: Evaluating the

general conditions of a construction contract: International Journal of Project
management, . 12 (3) pp 133-136.
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qualitative research in the built environment: application of “mixed” research
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of Construction and Property Management at the University of Salford, March
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for dispute avoidance and resolution (DAR): International Journal of Project
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AA037
Framework for Managing Complexity of Interconnections in Projects

Dimitris N. Antoniadis
(Project Manager, Carillion Ltd, London, UK)

Francis T. Edum-Fotwe
(Loughborough University, UK)

Anthony Thorpe
(Loughborough University, UK)

Abstract
Interconnections and boundaries between the various project parties have been
identified as an area which requires careful consideration. Complexity is caused by
interconnections and this could lead to a reduction in performance if the resulting
interface is not purposefully and efficiently managed. Understanding the
characteristics of complexity of interconnections, and how these affect organising
projects and the management style will enable the development and
implementation of innovative project actions and tools that will support the
management of complexity through the respective processes. The authors present
results from a study of UK construction organisations to shed more light on the
influences of complexity generated by the interconnections. The results from the
study have significant implications for the way project teams are put together and
managed, and enabled the introduction of a framework for managing complexity of
interconnections in projects.

Keywords
Complexity, Project Management, Organisation, Management Style

1. Introduction

Construction projects often involve a large number of activities comprising several

entities and interconnections. The nature of interconnections in a project can
generate complexity with defined characteristics. The various entities involved in
delivering the project are normally streamlined to minimise any potential
constraints that could arise from workflow. However, current practices in the
management of socio-organisational aspects of a project do not allow for such
streamlining (Busby and Hughes, 2004; Burns, 2005). The limitation occurs
because the conditions that cause interactions, from the organisational side, involve
methods that are unsuitable for the projects (Egan, 2005; Green, 2006). Also
project practitioners continue to adopt a transactional rather than transformational
approach (Andersen, 2003). Within this paper the authors investigate the
conditions that give rise to complexity of interconnections in the management of
projects and propose a framework to help mitigate the effects of such complexity in
projects by tackling the conditions that give rise to them. Interviews were
employed to investigate the implementation of existing practices, understanding of
complexity in projects, and innovative actions proposed to address the complexity
of interconnections in the areas investigated by managing its characteristics. From
the results it was established that complexity of interconnections is not managed
and the development of a framework is proposed. The framework will enable
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project management practitioners to manage the effects of complexity of

interconnections and the conditions that create them through the sub-processes
investigated.

2. Review

2.1 Complexity

The application of complexity theory to the management of complex adaptive

systems (CAS), which seek to understand the behaviour of individual elements, can
enable the systematic considerations of the conditions that give rise to such
complexity (Stacey et al., 2002). In construction interfaces cause complexity
(Baccarini, 1996; Williams, 2002), which is associated with the interconnection
structures that link various objects (Lucas, 2000a; Burns, 2005). Also the need to
deal with complexity at the lowest organisational level, the interactions between the
systems and the formulation of tenets of interactions, has been emphasised (Burns,
2005). Understanding the characteristics of these interconnections especially from a
socio-organisation standpoint can contribute to a more efficient project organisation
and its management. In particular, it should enable project managers to respond
with the necessary actions and improve the setting up of projects, as well as other
project management processes. Lucas (2000b) has suggested that complexity
arising from interconnections reflects distinct characteristics. The 16 directly
relevant characteristics have been mapped onto project conditions and described in
Antoniadis et al. (2006).

Construction projects are typically characterised by complexity and non-linearity

(Bertelsen, 2004); under time and/or cost pressure and requiring both creativity
and cooperation. Analysis of complexity in construction projects has been
conducted mainly from the technical perspective (Lillieskold and Eklstedt, 2003).
However, recently the subject of complexity has been linked to other non-technical
project activities such as – organisational and socio-behavioural (Geraldi, 2008;
Girmscheid and Brockmann, 2008). Much of the socio-organisation complexity can
be associated with the organising and the management style adopted, and it is the
focus of this investigation.

2.2 Organising projects and Management style

Organising projects – selecting team members and structuring the project team,
and the management style adopted are two major socio-organisational aspects in
projects which generate interconnections. Therefore, in order to establish the
current status of the three areas a brief review is carried out.

2.1.1 Selecting team members

The importance of the process of selecting team members has been highlighted by
a number of authors (Katz and Lazer, 2002; Belbin, 2004) and there are a number
of techniques available and key activities that provide the means. However,
although knowledge and training have been provided the sub-process is not
implemented and remains subjective, partially implemented and biased (Ogunlana,
et al., 2000, Hinds, et al., 2000; Green, 2002 and 2006). Therefore the sub-
process lends it self for investigation from the complexity perspective and in

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particular examining if any actions are taken by PM practitioners to manage its

effects.

2.1.2. Structuring project teams

Extensive literature exists on structuring projects and the types of organisational

structures and all the authors consider and discuss the importance of
interconnections between the project teams. Due to the importance of the
interconnections suggestions have been made which consider notions ranging from
complexity and chaos theory to behaviour and biology. However, as revealed in
literature, theory is not applied and the transactional approach with hierarchical
linearity are imposed (Andersen, 2003; Bertelsen, 2004). Glass ceilings within
structures (Green, 2006), unofficial structures (Panas, 2006), short-termism and
cost demands have a detrimental effect on structuring of projects as discovered by
Winter and Smith (2006). In general PMs do not consider how to structure their
team or the idiosyncrasies of projects (Moore, 2002; Busby and Hughes, 2004).
Therefore, this sub-process also lends it self for investigation from the complexity
perspective and in particular examining if any actions are taken by PM practitioners
to manage its effects.

2.1.3. Management style

Whilst considering complexity in project management, one cannot disregard the

management style which will enable the management of its effects in projects. The
topic is covered extensively in project management literature (Turner and Muller,
2005) and seven basic styles, with some overlaps, are suggested as applicable to
projects:
 Laissez Faire, Bureaucratic, Democratic, Autocratic; and
 Task / Production, People / Relationships, Corporate.
However, with the rapid socio-organisational, economic and technological changes
and the evanescent nature of projects there is a need for a new paradigm that will
enable the management of virtual project environments and the reduction in
complexity introduced by group interactions (Edum-Fotwe and McCaffer, 2004).

Thomas and Mengel (2008) in an extensive review of project management

education material, highlight that very little is currently covered regarding the
management style to be followed when dealing with complex adaptive systems
such as teams. In particular they state that there is concern that PMs are not
educated on transformational leadership and that there is a need to equip PMs so
that they are able to sense the prevailing conditions and lead / act accordingly.
Therefore, this area also lends it self for investigation from the complexity
perspective and in particular examining if PM practitioners consider the style to be
adopted in order to manage its effects.

6. Research Method

The literature review provided strong indications regarding the appropriate

implementation of the two sub-processes and the management style adopted in
construction projects. This coupled with the established view that construction
projects are immersed in complexity of interconnections led to the formulation of
the following study questions (SQ) as part of a wider research into complexity of
interconnections in construction:

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SQ 1: Complexity characteristics are considered when selecting project team

members.
SQ 2: Complexity characteristics are considered when structuring project teams.
SQ 3: Complexity characteristics are taken into account when considering the
management style to be adopted on a project.

The breadth and depth of the issues and the topics under investigation as well as
the requirement for a broader understanding of the issues demanded the use of
open-questions through closed interview sessions. The interviews explored current
understanding of complexity, its characteristics and techniques used to manage its
effects. Questionnaires were prepared and piloted with practitioners from three
organisations and corrections were made. The stratified sampling technique was
implemented in order to consider both sides of the project with the two main strata
comprising of three major construction client organisations and three major
construction companies. Board Directors from the six organisations were contacted
and asked to select randomly PM practitioners with more than 10 years experience
who would participate in the research. Interviews with 31 PM practitioners from Site
Manager to Project Director level were set up. The study questions were
operationalised by establishing a response greater than 75 points (from a scale of 0
to 100) of the average weighted effectiveness of the actions taken towards
managing the effect of each complexity characteristic. Following from the
interviews the findings were validated by conducting saturation interviews with
organisations and PM practitioners that did not participate in interviews.

4. Results

Implementation was over a period of ten months and presentations were given to
respective Board Directors on the aims and objectives of the research.

4.1 Interviews
From the 31 interviews conducted the majority of interviewees indicated that the
construction environment is friendlier, complex and dynamic, that the sub-
processes remain subjective and their organisations do not define nor give any
tools or techniques to identify complexity (Antoniadis et al, 2008). Figures 1, 2 and
3 provide an overall indication of the average weighted effectiveness of the actions
taken to manage the effect of each complexity characteristic when selecting team
members, structuring the project team and by the management style adopted. All
proposed actions for all the characteristics were reviewed with the interviewees and
any additional actions were included in the listings and considered in the overall
weighting.

4.2 Validation

The findings were validated by carrying saturation interviews. These were

conducted with PM practitioners, from Director to PM level, but from different Client
and Construction organisations. All interviewees confirmed that findings represent
reality and agreed with the need for a framework to manage the effects of
complexity of interconnections through the topics investigated. Interviewees
indicated that the framework, by using complexity characteristics and the generic
actions identified, can be generalised and used not only by construction PMs but
also by general managers.

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7. Analysis

In terms of SQs 1,2 and 3, interviewees (see Figures 1, 2 and 3) indicated that very
little is done and that no consideration is given to using techniques to manage
complexity. Results on the average weighted effectiveness of the current level of
actions taken for each complexity characteristic indicate that none has reached the
75 points level of acceptance. Thus, complexity of interconnections is not
considered and all three study questions are rejected.
Complexity Characteristics
Selecting Team members - Overall Results

Autonomous agents
100
Undefined values Instability
80
Non-standard Non-equilibrium
60 60

Unpredictability 40 50 Non-linear
63 30 24 16 53
20

Phase changes 38 0 67 Attractors T-Av

44 39

Emergence 41
52 Co-evolution
41
46
49
Non-uniform Self-modification

Mutability Self-reproduction
Downward Causation

Fig.1 Overall results for current level of actions taken for managing the effect of
complexity characteristics when Selecting Team members

Complexity Characteristics
Structuring the Project Team - Overall Results
Autonomous agents
100
Undefined values Instability
80
Non-standard 58 Non-equilibrium
53 60
65 45
48
Unpredictability 40 Non-linear
52 51
20
49 50
Phase changes 0 Attractors
T-Av
56 53
39
Emergence 37 53 Co-evolution

54 56
Non-uniform Self-modification

Mutability Self-reproduction
Downward Causation

Fig. 2 Overall results for current level of actions taken for managing the effect of
complexity characteristics when Structuring the Project Teams

8. Proposal for Managing Complexity of Interconnections

Complexity in construction requires a more structured approach. The establishment

of a simple plan of action and the availability of a framework will enable
practitioners to manage its effects.

The following points are proposed as a plan of action:

1) Define types of complexity;
2) Identify / understand the complexities to be dealt with;
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3) Establish the means to manage complexity. The ‘tools’/means that will be used
to identify actions that will mitigate complexity;
4) Monitor, that is, following up on actions implemented; and
5) Review and Improve; frequent review of actions taken, results obtained, and
any further actions required for improving the outcome.

Complexity Characteristics
Management of Team - Overall Results

Autonomous agents
100
Undefined values Instability
80
Non-standard 60 55 62 Non-equilibrium
69 60
60
Unpredictability 40 Non-linear
47 59
20

Phase changes 55 0 65 Attractors

T-Av
63 59
Emergence Co-evolution
57 42 55
45
55
Non-uniform Self-modification

Mutability Self-reproduction
Downward Causation

Fig. 3 Overall results for current level of actions taken for managing the effect of
complexity characteristics by the Management style adopted

With regard to complexity of interconnections and in terms of the means to be used

(step 3), the decision matrix process was used to evaluate the three options
considered and select the best suitable solution. A simple framework was developed
for the project management processes investigated which, by using the
characteristics of complexity establishes action(s) to be taken. The framework
allows PMs to ascertain the level of managing its effects at a particular point in
time, provides guidance for follow-up action(s) and allows for sequential actions to
be taken to support the monitor, review and improve steps. Additionally it is
flexible, it can be cascaded to the various project team levels and be implemented
multiple times. It also allows for different types of projects and project
management styles. The simple and holistic approach offers practitioners an
innovative and straight forward handling of the effects of complexity of
interconnections on projects through each project management process.

7. Conclusions

The investigation into the sub-processes of selecting team members, structuring

project teams as well as the management style adopted and the consideration of
complexity characteristics by practitioners, established that very little is done to
manage its effects. Results indicate that management of complexity remains within
a number of mechanistic tools which have been created by the construction
industry. Having linked the characteristics of complexity of interconnections to
construction, it is of interest to all parties to implement actions which will enable
the management of its effects through the project management sub-processes.

In a friendlier and more dynamic environment, where both clients and contractors
cooperate from a much earlier stage, organising and managing projects is feasible
and achievable. Also in a more complex environment the implementation of
appropriate behavioural processes and the understanding and management of

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complexity is feasible through a framework of actions that enables the management

of its effects through its characteristics.

8. References

Andersen, E.S. (2003), “Understanding your project organisation’s culture”. Project

Management Journal, Vol 34(4). pp.4-11
Antoniadis, D.N., Edum-Fotwe, F.T., Thorpe, A. (2006), “Project reporting and
Complexity”, In: Boyd D (ed) Proceedings of 22nd annual conference ARCOM,
UCE Birmingham, September 2006
Antoniadis, D.N., Edum-Fotwe, F.T., Thorpe, A., McCaffer, R. (2008), “Exploring
Complexity in Construction Projects”, In: Pantouvakis, J.P. (ed) Proceedings of
PM-04 – 4th IPMA/MedNet Conference, ‘Project Management Advances, Training
& Certification in the Mediterranean’, May 2008, Chios, Greece
Baccarini, D. (1996), “The Concept of Project Complexity – a Review”, International
Journal of Management Reviews Vol 14(4), pp.201-204
Belbin, R.M. (2004), “Management Teams Why they succeed or Fail”, 2nd edition,
Elsevier Butterworth-Heinemann Oxford
Bertelsen, S. (2004), “Construction management in a complexity perspective”, 1st
International SCRI Symposium, 30-31 March 2005, University of Salford, UK
Burns, B. (2005), “Complexity theories and organisational change”, International
Journal of Management Reviews Vol 7(2), pp.73-90
Busby J.S. and Hughes, E.J. (2004), “Projects, pathogens and incubation periods”,
International Journal of Project Management, Vol. 22(5), pp. 425-434
Edum-Fotwe, F.T and McCaffer, R. (2004), “The Leadership factor for managing in
future virtual construction projects. In Pantouvakis, J.P. (ed) Proceedings of 3rd
Scientific Conference on Project Management (PM-03), September 2004,
Thessaloniki, Greece, p.90-98
Egan, T.M. (2005), “Creativity in the Context of Team Diversity: Team Leader
perspective”, Advances in Developing Human Resources Vol. 7(2), pp.207-225
Geraldi, J. (2008), “The balance between order and chaos in multi-project firms: A
conceptual model”, International Journal of Project Management Vol. 26(4),
pp.348-356
Girmscheid G. and Brockmann, C. (2008), “Complexity of Megaprojects. The
inherent complexity of large scale engineering projects”, Project Perspectives
2008, Vol. XXIX, pp.22 – 26
Green, S. (2002), “The Human Resource Management implications of Lean
Construction: Critical perspectives and conceptual chasms”, Journal of
Construction Research, 3(1): p.147-165
Green, S. (2006), “The management of projects in the construction industry:
context, discourse and self-identity”, In: Hodgson D, Cicmil S, (eds), Making
Projects Critical, Palgrave Macmillan. Hampshire
Hinds, P.J., Carley, K.M., Krackhardt, D. and Wholey, D. (2000), “Choosing work
group members: balancing similarity, competence, and familiarity”,
Organizational Behavior and Human Decision Processes Vol. 81(2): p.226-251
Katz, N. and Lazer, D. (2002), “Building effective intra-organisational networks: the
role of teams”, Research paper, Centre for Public Leadership, J.F. Kennedy
School of Government, Harvard University
Lillieskold J. and Ekstedt, M. (2003), “Managing Complex IT-Projects – A need for a
tool addressing technical and organisational complexity”, The Royal Institute of
Technology, Industrial Information and Control Systems, Stockholm, Sweden
Lucas, C. (2000a), “Setting the Scene – Science, Humanity and Interaction”,
www.calersco.org Downloaded in August 2005
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Lucas, C. (2000b), “The Philosophy of Complexity”, www.calersco.org Downloaded

in August 2005
Moore, D.R. (2002), “Project Management: Designing Effective Organisational
Structures in Construction”, Malden MA: Blackwell Science
Ogunlana, S., Siddiqui, Z., Yisa, S. and Olomolaiye, P. (2002), “Factors and
procedures used in matching Project Managers to Construction projects in
Bangkok”, International Journal of Project Management, Vol 20(5), p.385-400
Panas, A. (2006), “The changing role of project management teams in distributed
environments”, MSc Dissertation, Loughborough University
Stacey, R.D., Griffin, D. and Shaw, P. (2002), “Complexity and Management: Fad
or Radical Challenge to Systems Thinking”, London, Routledge
Thomas, J. and Mengel, T. (2008), “Preparing project managers to deal with
complexity – Advanced project management education”, International Journal
of Project Management. Vol. 26(3), pp.304-315
Turner, R.J. and Muller, R. (2005), “The Project Manager’s Leadership Style as a
success factor on projects: A literature review”, Project Management Journal Jun
05, pp. 49-61
Williams, T.M. (2002), “Modelling Complex Projects”, John Willey & Son, Sussex
Winter, M. and Smith, C. (2006), “Rethinking Project Management”, Final Report,
EPSRC Network 2004 – 2006

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AA058

Project Managers and Designers: required or enabling cognitive

skills and personality characteristics

Georgios N. Aretoulis
(Research Assistant, Aristotle University, Thessaloniki, Greece)

Eleni N. Aretouli
(Post-doctoral Fellow in Neuropsychology, The Johns Hopkins University,
Baltimore,USA)

Yiannis Xenidis
(Lecturer, Aristotle University, Thessaloniki, Greece)

Fevronia Z. Striagka
(Research Assistant, Aristotle University, Thessaloniki, Greece)

Glykeria P. Kalfakakou
(Professor, Aristotle University, Thessaloniki, Greece)

Abstract
This study is discussing the personality characteristics, cognitive abilities and body
of knowledge that synthesize the profile of successful project managers and
designers. The paper determines the principal characteristics and skills which
enable engineers in the construction industry to excel either as project managers or
as designers. Our hypothesis suggests that personality characteristics and cognitive
abilities could potentially function as prerequisites or enablers in a career path.
Behavioural characteristics and skills are identified through a series of focus groups’
questionnaire surveys. Statistical analysis of the answers highlight personality
characteristics and cognitive abilities. The results are then compared to findings
from literature. Finally, appropriate psychometric tests are proposed in order to
quantify these characteristics and skills. This methodology could standardize the
selection procedures and implement similar approaches in improving and managing
human resources in Greek construction industry.

Keywords:
Project managers, designers, personality characteristics, cognitive abilities,
psychometric tests

1. Introduction

The effectiveness and productivity of organisations have been always dependent

heavily on the quality of their workforce, or their human capital (Wolf and Jenkins
(2006), (Dainty et al. (2003)). This study focuses on two essential groups of
engineers: project managers and designers. The term project manager (PM) is used
in the general sense of applying to the person, who has responsibility for managing
the whole or some major part of a total project (Pilcher (1994)). Typical
responsibilities of a project manager are coordinating and integrating of subsystem
tasks, assisting in determining technical and manpower requirements, schedules
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and budgets, and measuring and analyzing project performance regarding technical
progress, schedules and budgets (Jha and Iyer (2006)), (Royer (1974)).

On the other hand “Design” methods of today often emphasise a rationality based
on the designer’s cognitive powers (Stolterman (1991)). The very word “Design” is
in everyday use and yet given quite specific and different meanings by particular
groups of people (Lawson (2005)). Design ability is summarised as comprising
resolving ill-defined problems, adopting solution-focussed cognitive strategies,
employing abductive or appositional thinking and using non-verbal modelling media
(Cross (1990). Engineering design is a thoughtful process that depends on the
systematic, intelligent generation of design concepts and the specifications that
make it possible to realize these concepts (Dym and Little (2003)), (Dym (1994)).
The paper presents the questionnaire survey and its results. Based on the
personality characteristics and cognitive skills identified through the survey, the
proper psychometric tests are defined and analyzed. Finally, the conclusions and
future work are presented.

2. Questionnaire Survey

Questionnaires were presented to engineers, attending master programs in the Civil

Engineering Department of the Aristotle University of Thessaloniki. The
questionnaire included two simple, open research questions, quoted as follows:
 “Which are the cognitive skills and personality characteristics of construction
project managers”
 “Which are the cognitive skills and personality characteristics of designers”
The goal of the questionnaire survey was firstly to identify the personality
characteristics, the cognitive abilities and required knowledge. The survey collected
53 answers from engineers of various disciplines. The first stage included
decipherment of the data appearing in the answers. Information was recorded and
data was screened multiple times. Same elements are brought together, and
elements with similar meaning are grouped. Finally, descriptive statistics are
estimated and the dominant elements are identified.

3. Questionnaire Survey Results

The answers of participants focus on three main - significant aspects: Cognitive

Skills, Personality Characteristics, and Knowledge. The following tables identifies
required knowledge:

PROJECT MANAGER KNOWLEDGE PERCENTAGE

KNOWLEDGE OF PROJECT DETAILS, DESIGN AND PHASES 12,4%
TECHNICAL KNOWLEDGE, ECONOMICS, ACCOUNTING 22,5%
KNOWLEDGE OF CIVIL ENGINEERING 18,0%
KNOWLEDGE OF LAW, REGULATIONS 5,6%
KNOWLEDGE OF MECHANICAL EQUIPMENT 1,1%
KNOWLEDGE OF PROJECT MANAGEMENT SOFTWARE 5,6%
KNOWLEDGE OF PROJECT MANAGEMENT 10,1%
CONTROL ON RESOURCES AND WORKFLOW 4,5%
CONSTANTLY UPDATING TECHNICAL KNOWLEDGE 3,4%
EXPERIENCE 16,9%

Table 1: Project Manager’s Knowledge

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DESIGNER’S KNOWLEDGE PERCENTAGE

TECHNICAL KNOWLEDGE, REGULATIONS, LEGISLATION, CONSTRUCTION PROCEDURES 33,3%
KNOWLEDGE OF ARCHITECTURE 1,9%
KNOWLEDGE OF LAND SURVEY 1,9%
KNOWLEDGE OF SOFTWARE 7,4%
KNOWLEDGE OF ECONOMICS 2,8%
KNOWLEDGE OF SCHEDULING 2,8%
KNOWLEDGE OF MATERIALS 1,9%
CIVIL ENGINEERING DIPLOMA 6,5%
HEALTH AND SAFETY 0,9%
EDUCATION 3,7%
KNOWLEDGE OF PROJECT DETAILS AND DESIGN 23,2%
CONSTANTLY UPDATING TECHNICAL KNOWLEDGE 1,9%
EXPERIENCE 12,0%

Table 2: Designer’s Knowledge

The analysis that took place was aiming at estimating the frequency of appearance
of each factor. The results of the statistical analysis are presented in the two
following tables. The items that received the greatest percentages are highlighted
in the following tables:
PROJECT MANAGER’S SKILLS AND CHARACTERISTICS PERCENTAGES
INTEGRATED PERSONALITY 0%
CAREFUL, CAUTIOUS, DILIGENCE 2%
FORECAST, FORESIGHT, ANTICIPATION, PROVISION, PREVENTION, PREVENTION OF RISKS 4%
RESPECTED 1%
PRACTICAL 1%
HUMAN RESOURCE MANAGEMENT, DIPLOMACY, MAINTAIN BALANCE, CRISIS MANAGEMENT, CONFLICT 9%
RESOLUTION CONTROL CAPABILITY RESPONSIBILITY ALLOTMENT
UNDERSTANDING OF THE WHOLE PICTURE, PERCEPTION OF DEVIATIONS, SCALE PERCEPTION 2%
INSPIRATION - CREATIVITY 1%
LEADERSHIP CAPABILITIES, MOTIVATION CAPABILITY COORDINATION, COLLABORATION, PERSUASION 13%
COMMUNICATION, SPEECH CAPABILITY 13%
INTEGRITY - ETHICS, JUSTICE 2%
METHODICAL 2%
FLEXIBILITY, CONSIDERATION OF ALTERNATIVE SCENARIOS 3%
CONFIDENCE 0%
COMMITTED, DECISIVE, EFFECTIVE 4%
PROMPTNESS ON DECISION MAKING, READINESS, CAPABILITY OF SOLUTION MAKING 3%
COST MANAGEMENT CAPABILITY 2%
SELF-CONTROL, POLITE, UNDERSTANDING, COMPREHENSIVE 2%
RELIABILITY, RESPONSIBILITY, CONSISTENCY 5%
CAPABLE OF PSYCHOLOGICAL EVALUATIONS 1%
SCHEDULING, TIME PERCEPTION, PROGRAMMING CAPABILITIES 2%
STRATEGIC CAPABILITY 2%
SOCIAL AWARENESS - CONSCIOUSNESS, FRIENDLINESS 4%
ORGANIZATIONAL 11%
COMBINATORIAL LOGIC 1%
PATIENT, PERSISTENT 1%
INVENTIVE 3%
SELF RESTRAINED 1%
ADAPTIVE 2%
RIGHT JUDGMENT, CRITICAL THINKING 1%
PERCEPTIVE 1%
HARD WORKING 0%
DYNAMIC 1%

Table 3: Statistical Results for Project Managers’ Skills and Characteristics

The descriptive statistics’ results in the “Project Managers’” case are presented in
the following decreasing order of significance:
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 Leadership Capabilities 13%

 Communication 13%
 Organizational 11%
 Human Resource Management 9%
 Reliability, Responsibility, Consistency 5%
 Social Awareness – Consciousness, Friendliness 4%
 Committed, Decisive, Effective 4%

DESIGNER’S SKILLS AND CHARACTERISTICS PERCENTAGE

FORECAST, FORESIGHT, ANTICIPATION 4%
INTEGRATED PERSONALITY 1%
FANTASY 2%
CREATIVITY 2%
COMMUNICATION, CAPABILITY OF SPEECH AND EXPRESSION 9%
CONFLICT MANAGEMENT 1%
REALISTIC 1%
COLLABORATIVE, TEAM SPIRIT 11%
CAPABILITY OF COMBINING VARIOUS VIEWS, COMBINATORIAL THINKING 4%
EFFECTIVE, CAPABILITY OF SOLUTIONS’ FINDING 11%
CLARITY OF SOLUTIONS, DRAWINGS, ESTHETICS FUNCTIONAL PERCEPTION OF SPACE 4%
INSTRUCTIVE 1%
SPEED OF RESPONSE 2%
ANALYSIS - SCHEDULING, SIMULATION, FORESIGHT, IDENTIFICATION OF SENSITIVE POINTS, PLANNING 5%
CAPABILITY
CONSISTENCY, RESPONSIBILITY, ABIDE TO RULES 9%
ACCURACY 2%
CLEVER, SHARP 1%
TYPICAL, METHODICAL, CONSTANT CONTROL 5%
INVENTIVENESS, ORIGINALITY, RESOURCEFUL, INNOVATIVE THINKING, OPEN MINDED 5%
PROPER ACQUAINTANCES, SOCIAL, PUBLIC RELATIONSHIP, PROJECT CONSEQUENCES 7%
ORGANIZATIONAL 2%
CRITICAL JUDGMENT 2%
DECISIVE 2%
PATIENT, POLITENESS, UNDERSTANDING 3%
SIMPLE THINKING 2%
DOMINATING 1%
INTEGRATED PERCEPTION OF PROJECT – WORK SCALE 3%
JUSTIFIED OPINION 2%
TRUSTWORTHY 1%
HARDWORKING 1%

Table 4: Statistical Results for Designer’s Characteristics and Skills

On the other hand in the case of the planner the frequency of appearance of the
answers in decreasing order of significance are the following:
 Effective, Capability Of Finding Solutions 11%
 Collaborative, Team Spirit 11%
 Communicative, Capability Of Speech And Expression 9%
 Consistency, Responsibility, Abide To Rules 9%
 Proper Acquaintance, Social, Public Relationship, Project Consequences 7%
 Typical, Methodical, Constant Control 5%
 Inventiveness, Originality, Resourceful, Innovative Thinking, Open Minded 5%
 Forecast, Foresight, Anticipation 4%

A comparison of the descriptive statistics’ top results (receiving 4% and above) for
the two different disciplines indicates the following:
 Project managers place at the top of the list “Leadership Capabilities” which is a
characteristic that does not appear as a priority in the designer’s list

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 “Communication” is considered by both parties very significant and receives

high percentages, with the project managers emphasizing it more than
designers
 Consistency and Reliability are also important for both groups and receive high
scores, but designers place them higher in their list
 Social aspects of the engineer’s life and work are identified as significant by both
parties, with the designers being more socially aware
 Effectiveness is at the top of the designer’s list and receives a noticeable but not
significant score in the project managers’ approach
 It can be suggested that human resource management capabilities,
organizational, collaborative and team spirit have common elements and they
are similarly identified as significant by both disciplines

Literature has extensively covered the theme of project managers’ skills and
characteristics. Gaddis (1959) cited in Jha and Iyer (2006), emphasizes that project
manager needs solid basic experience in the relevant field and should be a leader
able to carry out planning and follow-up activities, in addition Stuckenbruck (1976),
cited in Jha and Iyer (2006) mentions that a proficient manager must be:
multidisciplinary oriented, global problem oriented, an effective problem solver and
decision maker, a good manager and administrator, possessing good analytical
abilities, creative in dealing with information and problems, an effective
communicator, able to motivate his team members to achieve fixed goals, flexible,
and able to adapt to change, of the right temperament, and should be able to keep
his calm. Finally Katz and Kahn (1978) cited in Jha and Iyer (2006) summarize the
skills of a project manager in three main categories namely: technical skills, human
skills and conceptual skills.

A glance at the abovementioned tables clearly presents that questionnaire survey

and literature highlight almost the same characteristics and skills concerning
project managers. In the case of designers, literature has little to offer on their
characteristics and skills. Most reviews highlight the skills often associated with
good designers, namely, the ability to:

 tolerate ambiguity that shows up in viewing design as inquiry or as an iterative

loop of divergent-convergent thinking
 maintain sight of the big picture by including systems thinking and systems
design
 handle uncertainty
 make decisions
 think as part of a team in a social process
 think and communicate in the several languages of design (Dym et al. (2005)).
 Thinking about system dynamics
 Reasoning about uncertainty
 Making estimates
 Conducting experiment
 Design Thinking in a Team Environment (Dym et al. (2003))
 The Languages of Engineering Design (Bucciarelli (2002))

4. Proposed Psychometric Tests for Evaluating Skills and

Characteristics

The selection of psychometric tests has been based on the identified characteristics
and skills of project managers and designers. Firstly, a personality test would be
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implemented. The paper proposes that the “Personality Inventory-Revised NEO PI-
R” should be used. The NEO PI-R provides a systematic assessment of emotional,
interpersonal, experiential, attitudinal, and motivational styles, a detailed
personality description that can be a valuable resource for a variety of professionals
(NEO-PI-R (2010)).

The abovementioned test can be used in combination with the “BarOn Emotional
Quotient Inventory™ (EQ-i™)”. There is a strong correlation between emotional
intelligence and job performance. The EQ-i is a scientifically developed and
validated measure of emotional intelligence, which reflects an individual's ability to
effectively deal with daily environmental changes. It assesses 15 dimensions of
emotional intelligence: Emotional Self-Awareness, Self-Actualization, Interpersonal
Relationships, Flexibility, Impulse Control, Assertiveness, Independence, Social
Responsibility, Reality Testing, Optimism, Self-Regard, Empathy, Problem Solving,
Stress Tolerance, and Happiness. It can be used as part of recruiting process to aid
in identifying potentially successful employees, also helpful in identifying those
emotional and social skills that are important to develop in employee training
programs, team building, and in enhancing managerial competencies at work
(BarOn EQ-I (2010)).

The next phase includes application of cognitive tests, in order to assess

intelligence. It is recommended to use the “Wechsler Adult Intelligence Scale”. This
examination was developed to provide most advanced measure of cognitive ability
(Wechsler Adult Intelligence Scale (2010)).

The final stage includes the examination of “Executive Functioning”. The use of
“Delis-Kaplan Executive Function System” is the proposed tool. This test is designed
to provide a comprehensive assessment of higher-level thinking and cognitive
flexibility – key components of executive functioning. It assesses vital executive
functions such as flexibility of thinking, inhibition, problem solving, planning,
impulse control, concept formation, abstract thinking, and creativity in both verbal
and spatial modalities (Delis-Kaplan Executive Function System (2010)).
Appropriate tests for verbal abilities should also be considered as part of this
approach such as “Word Fluency Task” (Kosmidis et al. (2004)).

5. Conclusions

It is observed that personality characteristics and cognitive skills from the two
groups appear to have simultaneously significant similarities and striking
differences. It is in these differences that the future work will be focused on. Project
Managers place at the top of their list “Leadership Capabilities” which is something
that is expected to appear in the case of managers. On the other hand, the top of
the designer’s list is occupied by “Effectiveness – Capability of Finding Solutions”.

Both focus groups identify “Technical Knowledge” as the most significant, with
slight differences in the content of term. Furthermore, the second place is occupied
by “knowledge of Project Details and Design”.

The proposed psychometric tests are based on the characteristics and skills
identified by the questionnaire survey and literature. The application of these tests
can facilitate evaluation of characteristics and skills and thus provide a
substantiated decision making tool for hiring or promoting people in the
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construction industry. Typically, a company first uses psychological profiling to help

hire or promote key people. Many companies establish a policy to have the
psychologist see all final candidates for a position above a specific salary level or
grade (Aretoulis et al. (2009)). This approach should be accompanied by close
examination of the curriculum vitae of the participants, a thorough structured
interview and available references.

6. Future Work

More extended statistical analysis can take place on the data acquired by the
survey. The participating groups of engineers have chosen postgraduate academic
programs that lead to project managers’ and designers’ master degree.
Correspondence analysis conducted separately for each group could potentially
reveal new data on their beliefs and perception concerning their career path and
choices.

The first stage of this study aimed at identifying the cognitive skills and personality
characteristics of these specific groups namely the project managers and the
designers. Since the characteristics and skills are identified then it is possible to
define the appropriate psychometric tests. The latter would be used to assess the
characteristics and skills.

During the future activities of this research study, proper groups of engineers will
be defined. More specifically engineers that excel as designers and engineers that
have made a career as successful project managers will be the appropriate
candidates. The aim of the research would be to measure if there are statistical
significant differences on the factors identified from the survey. The outcome of the
research can prove that there exist specific cognitive skills and personality
characteristics that lead engineers to excel or make a successful career as
designers or project managers. Apart from the unique and interesting results the
definition and identification of these factors can provide measurable criteria for
selecting the best people for hiring or promoting people in the construction
industry. It could also be used for training programs in order to create more
competent designers or project managers.

7. References

Aretoulis, G.N., Aretouli, E.N., Angelides, D.C., Kalfakakou, G.P. (2009), “Profiling
the Modern Project Manager”, in: Birgonul M.T., Azhar, S., Ahmed, S.M.,
Dikmen, I., Budayan, C. (ed.), Proceedings of CITC V conference, Collaboration
& Integration in Engineering, Management and Technology, Constantinople,
Turkey.
Dainty, A.R.J., Cheng, M. and Moore, D.R. (2003), “Redefining performance
measures for construction project managers: an empirical evaluation”,
Construction Management and Economics, 21, 209–218.
BarOn EQ-I (2010), “BarOn Emotional Quotient-Inventory”, Psychological
Assessment Resources, Inc., Bar-On, R.,
http://www3.parinc.com/products/product.aspx?Productid=BARON_EQ-I,
(Accessed, 10/03/2010).

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Bucciarelli, L. L. (2002), “Between Thought and Object in Engineering Design”,

Journal of Design Studies, 23, 219–231.
Cross, N. (1990), “The nature and nurture of design ability”, Journal of Design
Studies, 11(3), 127-140.
D-KEFS™ (2010), Delis-Kaplan Executive Function System, Pearson Assessment,
http://www.psychcorp.co.uk/product.aspx?n=1316&s=1321&cat=2004&skey=
2638, (Accessed 10/03/2010).
Dym, C.L. (1994), “Engineering Design: A Synthesis of Views”, New York,
Cambridge University Press.
Dym. C.L., Agogino, A.M., Eris, O., Frey, D.D., Leifer, L.J. (2005), “Engineering
Design Thinking, Teaching, and Learning”, Journal of Engineering Education,
94(1), 103 -120.
Dym, C.L., and Little, L. (2003), “Engineering Design: A Project-Based
Introduction”, (2nd edition), New York, John Wiley.
Dym, C.L., Wesner, J.W., and Winner, L. (2003), “Social Dimensions of Engineering
Design: Observations from Mudd Design Workshop III”, Journal of Engineering
Education, 92(1), 105–107.
Jha, N.K. and Iyer, C.K. (2006), “What attributes should a project coordinator
possess?”, Journal of Construction Management and Economics, 24, 977-988.
Kosmidis, M.H., Vlahou, C.H., Panagiotaki, P. and Kiosseoglou, G. (2004). “The
verbal fluency task in the Greek population: Normative data, and clustering and
switching strategies”, Journal of the International Neuropsychological Society,
10, 64–172.
Lawson B. (2005), “How designers think. The design process demystified”, (4th
edition), Architectural Press, Elsevier, Oxford.
NEO-PI-R. (2010), NEO Personality Inventory-Revised, Psychological Assessment
Resources, Inc., Costa, P.T., McCrae, R.R.
http://www3.parinc.com/products/product.aspx?Productid=NEO-PI-R,
(Accessed 10/03/2010).
Pilcher, R. (1994), “Project Cost Control in Construction”, (2nd edition), Blackwell
Scientific Publications, Great Britain.
Royer, K. (1974), “The Construction Manager”, Prentice Hall, Inc., Englewood Cliffs,
New Jersey.
Stolterman, E. (1991), “How System Designers Think About Design And Methods
Some Reflections”, Scandinavian Journal of Information Systems, 3, 137-150.
WAIS-IV UK (2010), Wechsler Adult Intelligence Scale, Pearson Assessment,
Wechsler, D.,
http://www.psychcorp.co.uk/product.aspx?n=1316&s=1321&cat=1422&skey=
4446, (Accessed 10/03/2010).
Wolf A. and Jenkins A. (2006), “Explaining greater test use for selection: the role of
HR professionals in a world of expanding regulation” Journal of Human Resource
Management, 16, 193–213.

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AA077

Modelling as a soft skill for the assembly and usage of a Project

Compendium via sensemaking concepts and its software application

Steve Armstrong
(Lecturer, The Open University, Milton Keynes, England)

Abstract
This paper takes a systems view in order to explore and illustrate the relationships
between the factors and actors that have an influence upon the course of action as
the project plan is realized. An understanding of the issues relating to a project’s
risks, requirements and resources is the basis for a successful implementation of a
plan to meet the time, cost and quality criteria. So, the ability to use qualitative
models would be a potential component in revising the competency baseline now
that complexity has a greater influence on projects (e.g. performing project health
checking). From the recent set of case studies and interviews, it is viewed that
Project Compendium components can be used to manage project knowledge
effectively. They help to ensure transparency, availability and accessibility of
information that is a potential contribution to project success, assuming they have
an adequate level of quality within the context.

Keywords
Project Compendium, complexity, modelling, knowledge management, soft skills

1. Introduction

There are many texts available on the topics related to human behaviour inside
organisations (e.g. McShane and vonGlinow, 2008). Some of the models related to
organisational behaviour have been used inside some of the recent research
associated with the soft skills needed in the context of project management (e.g.
Pant and Baroudi, 2008). Taking the view that promoting a successful project needs
a combination of both hard and soft skills depending upon its context, then the
curriculum for teaching project management needs to be revised.

As organisations become more mature in the application of project management,

the criteria for judging success include those that are concerned with the impact of
the project on its environment. The fit between the project and the organisation
and its consequences for the performance of the organisation are reported as
important issues. Hence, there has long been an interest in establishing a set of
factors to be monitored in order to promote success and/or avoid failure (e.g.
Cleland and King, 1983). A lack or excess in any such factor leads to risk.
Furthermore, relationships between factors lead to other consequences: an excess
of user involvement, for example, places pressure on the communication channels
as well as the schedule.

This paper is intended to show how a particular systems approach to modelling can
be used in the ‘shifting sands’ of project working. For example:
 a significant shift in a client’s preferences may be regarded as a
requirements change

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 reframing a requirement can make it forcibly relevant to a new set of

stakeholders
 a significant event can cause stakeholders to switch roles and this is likely to
change their requirements.

In each subsequent situation, there will be resource and risk implications

(Armstrong and Saunders, 2004). The Association for Project Management (2006)
has identified modelling and testing as one of the techniques to ‘assist in the
successful delivery of project objectives’ (p51). The central issue of this paper is
concerned with the use of models in projects from a theoretical and practical
perspective. Modelling is a way of thinking about things and ideas in the ‘real
world’. In effect, a model is a way of expressing a particular view of an identifiable
system of some kind. So, models are:
 a way of understanding the problems involved
 an aid to communication among those involved, especially when a part of
some deliverable is being investigated
 a component of the methods used in a given activity, such as the financial
modelling done to test the feasibility of a proposal.

A good model is an abstraction, which allows those involved to concentrate on the

essentials of a complex problem by keeping out the non-essential details. Changing
the model you have about a situation is equivalent to changing the way you think
about it, which may have an influence upon your current practice. For example,
decision making is a technique that has to be used effectively when you apply the
process of modularisation (breaking up a large problem into a number of smaller,
more manageable ones).

2. Model examples related to change

Over the years there have been many models defined, constructed, used etc. But,
this section introduces a small number of examples to promote a practical
association to the systemic perspective that can be used in the management of
projects. Of course, all the various forms of qualitative and quantitative models can
contribute to the decision making processes used in project management. The
concept of changes that cause unwanted or unplanned difficulties is not new; 'side-
effects' have been studied since ancient times. The difference between solving and
resolving has deep roots in our thinking. When it comes to change and any
'realities' we might identify, we see that change has direction: either
conventionalising or differentiating. This means that change takes us either towards
(conventionalising to a monoistic position) or away (differentiating to a pluralistic
position) from an existing symbolisation, which was discussed by McWhinney
(1992) who also defined six basic modes of change:
1. Imperative - change achieved by either a charismatic or authoritarian
leadership;
2. Analytic - change achieved by imposing policies such as theory applied
through data;
3. Influential - change achieved by acceptance of new values from the
imposition of 'truth' by either an authority or a population;
4. Inventive - change achieved through the materialisation of a new and
creative idea;
5. Participative - change achieved by the development of a consensus of value
within the relevant group and based upon empirical explorations;

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6. Emergent - change achieved through the creating and accepting of the new
by an idea leader or crystallisation from within the group.

These modes of change help to refine the tools and methods needed to achieve
change, but they require involvement with two, or more, realities. The basic view or
reality will provide those things which we take as given, especially the structure.
We use a second reality to produce the concentration and effort that regulates and
co-ordinates movement towards a desired outcome.

2.1 Formal Systems Model

In reviewing the 63 publications that had focused on critical success factors (CSFs),
Fortune and White (2006) found that some of the definitions of each factor were
not clear; thus, raising the potential for ambiguity. This is not surprising, given the
variety in the various authors’ backgrounds and in the case studies and surveys
that were used in the papers that were reviewed. The Formal Systems Model (FSM)
is a framing device to deliver the benefits of using CSFs whilst, at the same time,
taking into account their inter-relationships and dynamics. The FSM comprises a
decision-making subsystem, a performance monitoring subsystem and a set of
subsystems and elements which carry out the appropriate tasks to achieve the
desired outcome. When used during the planning and implementation phases, the
FSM can guide the project manager in addressing the human and organisational
aspects. A business case, for example, should contain a prioritised list of critical
success factors to reflect the context in which the proposed project will take place.
For each critical success factor, it may be possible to identify a qualitative or
quantitative measure that can be monitored during the project. Any variation
beyond a given threshold for a particular critical success factor can be interpreted
as placing the project at risk. In practice, appreciating different viewpoints is likely
to be the most important, influential or sensitive factor in trying to achieve project
success. So, the ability to understand and appreciate different viewpoints is a
competency that may be associated with the soft skills for project management.

2.2 Influence and multiple cause diagrams

Figure 1 contains an influence diagram showing some of the relationships between

CSFs from a project perspective (Armstrong, 2007). This would is something that
could be done in the preparation of the business case for a new project. The
diagram does not show all the potential influences, since it is important not to
overload a single diagram with too much information. For example, all the
stakeholders have a potential influence on communication and feedback.

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project
environmental
influence user/client requirements
involvement

risk and project rationale project sponsor/

political uncertainty champion
stability
business case project scale
change
management and complexity

risk
management technology mehtods/
project plan familiarity tools

revision schedule
control objectives
monitoring and
control implementation
monitoring process
plan product

leadership
learning resource resources
reviewing allocation
learning from
past experience project
manager
communication and budget
feedback
suppliers,
contractors and
appreciation of consultants
different viewpoints training
provision
organizational
adaptation, staff/team
culture and
structure senior management

Fig 1: Influence diagram of some of the factors and actors concerned with a
project’s success

The project plan has been placed at the centre of Figure 1 to represent its central
role in project working. The four other sub-systems (requirements, resources, risk
and uncertainty, and learning) were created to illustrate the potential for grouping
factors and actors in the context of a project. In general, influence diagramming in
a way of interpreting the complexity of a project. A number of authors, such as
Austin, Newton, Steele and Wasket (2002), have investigated aspects of project
complexity in order to get improvements in efficiency and effectiveness.

A multiple cause diagram can be used to identify and tackle the causes of a
complex problem in a systemic way. This type of diagram is used to explore why a
given event happened or why a certain class of events tends to occur. In practice,
multiple cause diagrams are often derived from influence diagrams. This has been a
part of the Open University’s long-standing courses on systems thinking (e.g. Ship,
2008). The normal starting point for constructing multiple cause diagrams is with
the state or event to be explained. When a lack of support form senior
management is detected, for example, that state is the focal point of the diagram.
Then, you can work outwards and backwards through the chains of causal
connections to identify the relevant sequences and/or loops. Alternatively, you
might begin by assuming that a particular project had failed. Then, consider
changes in state for the CSFs, such as the following:
 Lack of user involvement
 Lack of resources
 Unrealistic expectations
 Incomplete requirements.
Figure 2 contains an example of the states and/or events that might lead to a
strong sense of dissatisfaction with a new software application. In practice, the
context for software projects does vary. So, there is a probability that different
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multiple cause diagrams will result from the analysis of each situation when user
dissatisfaction becomes significant.

inadequate support
from senior
management errors in
budget

staffing lack of funds

difficulties unrealistic
deadlines

inexperienced
staff lots of
bugs found poor reduction
support in scope

patches
misapplied

inefficient
configuration excessive poor poor core
management down time quality features
screen of reports
layout missing
poor
security

slow response
time
poor user dissatisfaction
usability with application

Fig 2: Multiple cause diagram investigating user dissatisfaction

It should be noted that multiple cause diagrams are not intended to predict
behaviour, but they may be used to construct a list of factors to bear in mind when
investigating comparable circumstances in the future. Hence, a number of multiple
cause diagrams might be constructed as part of a risk analysis for a project. Their
contents would contribute to the quantitative elements in the planned responses to
the risks. In practice, some further annotation may be required when there is
insufficient evidence to denote a causal connection. For example, an arrow might
be associated with other phrases like: ‘contributes to’, ‘is followed by’ or ‘enables’.

3. Project Compendium

The notion of a Project Compendium is a set of templates, methods and tools that
tie people, the stakeholders and the project team, and their ideas together. When
assembled, a Project Compendium allows people to work in different ways: in
meetings, in documents, working alone and/or in different locations. The underlying
goal is to improve the way project teams go about their work via the facilitation of
knowledge sharing and a collaborative way of working. The introduction of a
hypertext-based tool allows the project manager to address the problems
associated with communication and knowledge management, which is a natural link
to decision making in practice.

Compendium is a software tool that has a flexible visual interface for managing the
connections between information and ideas. It was developed at the Open
University in the 1990s and is located in the Compendium Institute
(http://compendium.open.ac.uk/institute). The application allows teams to analyze,
design, communicate, manage and collaborate using a compendium of tools and
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artifacts. It has a strong association with the sensemaking needed for knowledge
management that has been implemented via dialogue mapping and its extension
for conversational modelling (Conklin, 2005). After all the research and practice,
the discipline of mapping intellectual landscapes is now called ‘Knowledge
Cartography’ (Okada, Buckingham Shum and Sherborne, 2008). Maps of concepts,
discussions and arguments make the connections between tangible and disputable
ideas now that the software is seen as a set of visual tools for reading and writing
in a networked age.

As a fairly simple introduction to the maps that can be created inside the
Compendium application, Figures 3 and 4 illustrate a number of ideas in response
to two questions that may be asked during the initiation of a project.

Fig 3: A question about project roles

The next set of nodes might be for arguments for and against each idea that may
be followed by a decision node. Each node may also be linked to another one
containing notes or even an accessible reference (e.g. business case document).
Maps may also be created as templates for other contexts (e.g. project phases).

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Fig 4: A question about the tasks in a project

4. Conclusion and some openings for further work

This paper has identified a couple of modelling tools that could be put into a
project’s ‘kit bag’. In practice, a number of decisions should be taken about who
might use the techniques and when they might be used. The main aim of the
research that is going to be started is to investigate the assembly and usage of a
Project Compendium. In each case, the focus will have to be upon all of the phases
of a project. The Compendium application can be used to address concerns related
to knowledge management for a project team, so that it offers the possibility of
improved efficiency and reduced uncertainty when dealing with projects that have
various levels of complexity. For example, it can also be used to construct and
perform project health checks. The respondents to a number of interviews since
2004 viewed that the concept’s application may contribute to project success.
These discussions took place when the author gave a presentation about the
software at the IPMA World Congress in 2004 and 2007. An MSc student, Meiers
(2010), conducted a related survey. The respondents viewed that components can
be used to effectively manage project knowledge which should ultimately contribute
to project success. Achievement of business objectives was voted by more people
as being highly relevant to project success compared to budget, schedule, scope
and customer satisfaction.

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5. References

Armstrong, S. (2007), “Projects run on requirements, resources and risks:

augmenting the ‘iron triangle’ to keep an eye on critical success factors during a
project”, 21st IPMA World Congress, Krakow.
Armstrong, S. and Saunders, R. (2004), “A systems view of those human activities
we include in a project”, 18th IPMA World Congress, Budapest.
Association for Project Management (2006), “APM Body of Knowledge” (5th edition),
APM, High Wycombe.
Austin, S., Newton, A., Steele, J. and Wasket, P. (2002), “Modelling and managing
project complexity”, International Journal of Project Management, 20(3), 191-
198.
Cleland, D.I. and King, W.R. (1983), “Systems analysis and project management”,
McGraw-Hill, NewYork.
Conklin, J. (2005), “Dialogue Mapping: Building shared understanding of Wicked
Problems”, Wiley, Chichester.
Fortune, J. and White, D. (2006), “Framing critical success factors by a systems
model”, International Journal of Project Management, 24(1), 53-65.
McShane, S.L. and vonGlinow, M.A. (2008), “Organizational Behavior”, McGraw-Hill,
New York.
McWhinney, W. (1992), “Paths of Change”, Sage Publications, Newbury Park.
Meiers, P. (2010), “Assembling the Project Compendium”, MSc Dissertation (draft
at the time of writing this paper), The Open University (UK)
Okada, A., Buckingham Shum, S. and Sherborne, T. (2008), “Knowledge
Cartography: Software Tools and Mapping Techniques”, Springer, London.
Pant, L. and Baroudi, B. (2008), “Project management education: The human
skills”, International Journal of Project Management, 26(2), 124-128.
Ship, K., “T552 Diagramming: Systems thinking and practice”,
http://systems.open.ac.uk/materials/t552/index.html (accessed 1st March
2010).

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AA097

Construction Superintendents need Leadership

William W. Badger
(Professor, Arizona State University, Tempe, AZ, USA)

Avi Wiezel
(Associate Professor, Arizona State University, Tempe, AZ, USA)

Daniel Adams
(Graduate Student, Arizona State University, Tempe, AZ, USA)

Peter Bopp
(Retired, Dupont, USA)

Abstract
This paper presents a method of profiling the leadership skills of construction field
superintendents and relating these skills to the success of their project. The
leadership competencies of 43 superintendents were assessed utilizing a self-
evaluation “Field Construction Superintendent Questionnaire” (FCSQ)
complemented by a “Project Manager Questionnaire” (PMQ) that provided an
independent performance evaluation from the superintendent’s project manager.

Analysis of the data collected from the FCSQ and the PMQ shows significant
correlation between the leadership competency levels and the job performance
levels of the Field Construction Superintendents. The data collected allowed to
asses the importance and need of leadership as well as management skills for
superintendents. Not surprisingly, the effectiveness of management skills
dominates the job performance of a construction superintendent but it is the degree
of applied leadership skills that make the difference between average and
exceptional performance (Great Superintendents). Participants were ranked based
on their leadership scores. Interviews conducted with the participants’ company
executives found a 90 percent accuracy rate in the ranking when compared to
performance and profits generated by the participants.

Keywords
Leadership, Management, Profiling of Skills, Construction Superintendents

1. Introduction

To achieve better than average success in the construction industry, Field

Construction Superintendents need to possess effective management and
leadership competencies. According to Post (1998), improved leadership
competency is clearly needed at this level as studies indicate that barely 70 percent
of building owners were fully satisfied with the performance of their construction
project.

Construction companies face an increasing need to formalize not only their safe-
work environment efforts, but also to rapidly and continuously improve their field
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productivity. Until recently, ongoing field productivity improvement efforts have

been focused on the operational side of the business, where 85 to 95 percent of the
dollars are spent (Abberger, McComb, & Spragins (1997)). Substantial research
funds are spent on the development of new building materials, software, automated
management processes, and concepts designed to improve the construction
industry’s ability to estimate, plan, schedule, and manage operations.
Comparatively, leadership at the construction site has received little attention thus
scant research exists on leadership competencies and development of construction
project managers and engineers. However, it is becoming increasingly apparent
that all participants in this industry must spotlight the leadership and management
development of their superintendents and foremen with an emphasis on creating
more robust, effective competencies.

For the purpose of this study, the Field Construction Superintendents were defined
as the overseer of the daily activities at a construction site and called
superintendents (Adams, (2007)).

Superintendents enter the field for numerous reasons and with widely diverse
abilities and skills. In addition, the shrinking labor pool is driving the construction
industry to hire workers from less traditional labor pools, including women and
minorities, creating the need for additional employee training - not only in technical
skills, gender and diversity sensitivity - but also in leadership and management
skills. This training is, all too often, only rudimentary or non-existing (Abberger,
McComb, & Spragins (1997)). Leadership studies at universities have rarely focused
on the leadership role of construction site managers. They have not been assessed
as the leaders of their site teams, nor have they been assessed on their wide range
of managerial styles which are adopted on the job site and are crucial to successful
projects.

Over the past five decades, the interest in understanding the essence of leadership
has continuously grown and taken many directions. Recently, the leadership in
construction has attracted attention, recognizing a definitive need and dearth of
data. Research conducted by Adams (2007) examined the role that the presence or
absence of leadership skills plays in the job performance of field construction
superintendents. Also examined were the influences that drive the development of
their leadership competencies. Obviously, his research is based on the assumption
that leadership behaviours can be taught and learned and that they are not
endowed only to exceptional individuals at birth.

There are many types of superintendents. Their job titles and responsibilities vary
significantly from one company to another; they even differ within the same
company by project size. Confusion concerning the role of the superintendent is
common as there are no uniform rules or definitions which apply to all construction
firms, construction projects, or supervisory positions.

The objective of the research was to test the hypothesis that the leadership
competency level of a superintendent significantly influences his/her job
performance. The selected approach was to first understand the role that leadership
plays in the job performance of superintendents, second to identify potential causal
influences that affect a Total Average Leadership Score (TALS), and finally relate
everything to project results and financial success.

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2. Research Objective and Methodology

The research process was preconditioned on the development of a questionnaire

that would effectively profile a superintendent’s management and leadership
competencies and determine how leadership affects his or her job performance. The
objective was to obtain sufficient data that would allow ranking the leadership
levels of superintendents and identify a possible relationship between leadership
levels and job performance levels. An extensive literature review identified all the
concepts, ideas, theories, instruments, tools, and practices that could possibly be
related to leadership in the construction industry. Too many promising constructs
were included in an initial draft of the questionnaire resulting in an expansive,
lengthy and time-consuming survey document. This first iteration was quickly
deemed impractical for the construction industry due to its length; it demanded a
quick grasp of many complex concepts, and would require too much time to
answer. Furthermore, to safeguard against self-bias, inaccurate, inflated, and
closed-minded responses, it was decided to develop two questionnaires, one aimed
at the superintendent and one at the supervisor of the superintendent (i.e. the
project manager). It was the combined use of the Field Construction
Superintendent Questionnaire (FCSQ), and the Project Manager Questionnaire
(PMQ) that assured sufficiently accurate and valid leadership data on the
performance of the individual serving as superintendent as well as on the overall
project success and customer satisfaction.

Each of the two questionnaires shred a list of sixteen leadership competencies (as
defined by Zenger & Folkman (2002) - see Table 1) and seven job performance
questions (developed by the authors - see Table 2). The FCSQ also contained
twelve job experience and educational questions reproduced from by Skipper & Bell
(2006) , as well as six questions on the amount of time the superintendent spends
in leadership and management roles cased on Kotter (1990) (see Table 3).

The participants were asked to rank the competencies on a horizontal Likert scale
from 1 to 10. At the two ends of the Likert scale the questionnaire presented a
clear description of the behavior representing the indicated performance for the
specific characteristic (poor at one end and superior at the other).

For instance, selecting 1 on the Likert scale for leadership competency #5 (see
Table 1) “Practicing self-development” was described as: “Seems unconcerned
about any kind of self-development. Is content with current skills and abilities.
Fears that others might perceive their development of new skills as a sign of
incompetence or weakness.” At the high end of the Linkert scale (10), competency
#5 was described as: “Makes constructive efforts to change and improve based on
feedback from others. Seeks feedback from others to improve and develop
themselves. Constantly looks for development opportunities. They are excited to
learn.”

Leadership Competencies
1. Displayer of high integrity and honesty
2. Technical and professional expert
3. Problem solver and issue analyzer
4. Innovator
5. Self-developer
6. Focused on results

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7. Establisher of stretch goals

8. Leader responsible for outcomes/ initiatives
9. Powerful and prolific communicator
10. Inspiration and motivator for others to be high performers
11. Relationship builder
12. Developer of others
13. Collaborator and team worker
14. Developer of strategic perspectives
15. Champion of change
16. Connector of internal groups with outside world

Table 1: Leadership Competencies

Job Performance Factors

1. Quality
2. Safety
3. On Time
4. On Budget
5. Retention
6. Interpersonal Skills
7. Technical Skills

Table 2: Job Performance Factors

Leadership Management
1. Aligning people 1. Controlling and problem solving
2. Establishing direction 2. Planning and budgeting
3. Motivating and inspiring 3. Organizing and staffing

Table 3: Leadership and management roles

The Project Manager Questionnaire (PMQ) contained the same leadership

competencies and job performance questions as the FCSQ with three additional
impact questions:
1. In the overall results of the construction project, how well are the services you
received from the field superintendent meeting your expectations?
2. In the overall results of the construction project, how likely are you to
recommend this field superintendent to others?
3. In the overall results of the construction project, would you want to work with
this field superintendent again on another project?

The subjects of this study were superintendents and project managers from
established and successful construction companies that conduct business across the
American Southwest (Arizona and Nevada area). Comprehensive data was obtained
regarding 43 superintendents from four construction companies who agreed to
participate in the study. The number of employees and the annual construction
revenue of the participating companies vary significantly. Each data point in this
study consisted of the combined input from both the superintendent and his/her
project manager. The scores for both responses for each of the participants were
combined and averaged for every question common to both questionnaires.

The data were then analyzed as follows:

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1. Data from the 16 leadership competency questions were totaled, combined,

averaged, and then converted into percentages. The resulting percentage scores
from the 16 leadership competency questions were labeled as “Leadership
Competency Level” (LCL).
2. Data from the seven job performance factors were totaled, combined, averaged,
and then converted into percentages. The resulting percentage scores from the
seven job performance factors were labeled as “Job Performance Level” (JPL).
3. Data from the three impact questions, unique to the PMQ, were totaled and
converted into percentages. The resulting impact questions were labeled
“Impact Level” (IL).
4. The raw scores from the combined and averaged 16 leadership competency
questions, the combined and averaged seven job performance questions, and
the three impact questions were totaled and then divided by the total possible
points of 260. These scores were then converted into percentages. The resulting
scores were labeled “Total Averaged Leadership Score” (TALS).
5. The data were grouped according by companies and by “Great Superintendents”
(GS). The Great Superintendents possessed TALS of 90 percent or higher; only
eight out of the 43 qualified.

The findings were validated by comparing the superintendent’s leadership ranking

in the study to the participating companies’ executive own internal and independent
ranking of the individual.

3. Data, Findings, and Interpretation

The findings of this study are based on the results of the FCSQ-PMQ and
unequivocally support the hypothesis that the leadership competency level (LCL) of
a superintendent significantly influences his/her job performance level (JPL). Plots
of the data of all the participating 43 superintendents (see Figure 1) reveal an R-
squared value of 0.6875 suggesting that the trend line is significant. The hypothesis
is supported by the fact that the two variables, LCL and JPL, yield a Pearson
correlation value of 0.829 and a p-value of 0.000, which is less than alpha level of
0.05.

The data appears to indicate that the age and job experience of the
superintendents is correlated with TALS, but more data is needed to confirm this
conclusion. The data also indicate that the FCSQ is either ineffective in assessing
the time each superintendent spends in leadership or management roles or that the
superintendent lacks the understanding to differentiate between leadership and
management.

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Table 3: Leadership Competency Level vs. Job Performance Level

The data show that every “Great Superintendent” as well as every participating
company identified “Develops Strategic Perspective” as one of their top three
leadership weaknesses. This competency was defined as: (1.) knows how work
relates to the organization’s business strategy (line-of-sight connection), (2.)
translates the organization’s vision and objectives into challenging and meaningful
goals for others, and (3.) takes the long view, can be trusted to balance short-term
and long-term needs of the organization. This weakness clearly indicates that all
the superintendents act more like managers than leaders.

Three of the four fully participating companies list on-time projects as another one
of their top weakness. However, the data on the eight “Great Superintendents”
(GS) only show “retention” as a relative weakness, although even this job
performance factor of theirs is significantly higher than the average. Retention was
defined as keeping personnel from departing the organization and as such a low
retention may be good or bad. If the GS is moving people up the career ladder to a
better fit in the company, or if they are getting rid of ineffective people, the low
retention rates may be serving the company well. On the other hand, if the GS is
unable to retain his followers for other reasons, a low retention rate may be
detrimental.

The data strongly concur with earlier findings by other researchers, indicating that
most superintendents learn their leadership through job experience and that top
performers have mentors. It confirms the importance of mentorship in leadership
development along with the fact that most construction superintendents have
acquired their leadership skills through job experience and by observing their
leaders. The differences between leadership and management are highlighted by
the data. It is very apparent that a balanced blend of leadership and management
skills are a key characteristic of every one of the eight “Great Superintendents.”
The research also indicates that the amount of time that the superintendent spends
in a leadership role is less than the amount of time project managers or the
company executives spend in leadership roles.

Furthermore, the data support the unsurprising fact that superintendents’

increased-educational levels do not directly relate to superior leadership, which
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leads to the conclusion that there is a critical need for leadership training in the
construction industry.

The responses also reveal that college courses in construction related subjects are
presently inaccessible to the average superintendent, who works an average of 53
hours per week. The average superintendent’s long work hours and lack of free
time may explain why the average number of college courses taken in the past five
years is nearly zero. The rigor of university construction management courses may
also be intimidating to the already over-extended superintendent, since most
superintendents have started college but few have ascertained university degrees.
Perhaps the higher education classes are not being taught at the level necessary for
the average superintendent to comfortably and effectively learn, given the indirect
finding that their communication skills are significantly underdeveloped. There
appears to be a need to build-up their communication-skill level prior to recruiting
them to enroll in university construction courses and programs. Since education
generally improves the quality of life in other industries, perhaps an analysis of how
the university and the construction industry could collaborate in creating
innovative, leadership-building programs for the majority of superintendents that
have so far not recognized the need or found the opportunities to develop and
improve their leadership skills.

4. Conclusions

The collected data support the hypothesis that the Leadership Competency Level of
the superintendent has a major influence on his/her Job Performance Level. They
clearly indicate whether the study participants possess management or leadership
tendencies, and the degree to which they possess leadership competencies. The
individual leadership-competency levels can be related to Job Performance Levels,
thereby surfacing a clear relationship between them. The eight “Great
Superintendents” (GS) very significantly outperform the average on all leadership
elements.

The FCSQ-PMQ also provides detailed data regarding specific areas of leadership
and job performance in which superintendents have some deficiencies. The FCSQ-
PMQ can be utilized by the construction industry’s executives in comparing their
superintendents’ Total Average Leadership Score (TALS), LCL and JPL scores with
the scores of the “Great Superintendents” or a benchmark group. The resulting gap
analysis can then be used to design individual mentorship plans for each
superintendent to improve his/her leadership, which should, within a relatively
short time, impact the companies’ bottom line.

Certain characteristics of leadership enhance the chances for success in working

with diverse project teams. An open style of management increases trust. A good
sense of humor can diffuse potential misunderstandings. A sincere interest by the
superintendent in his staff as individuals goes a long way toward creating good
morale. A good communication style is exceedingly important.

Awareness of social and cultural factors are widely considered today as critical to
effective construction project performance and pivotal in achieving successful
construction projects outcomes. Many field teams have members whose first
language is not that of the dominant group. An understanding of the differences in
world view between groups is essential in promoting understanding among team
members. The same event can be interpreted differently by various individuals
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depending on their origin and what they have been conditioned to believe.
Understanding and avoiding stereotypes prevent self-fulfilling prophesies.

Interviews conducted with three of the participants’ company executives, covering

almost 90% of the participating superintendents, found that, for those companies,
the FCSQ-PMQ has a 90 percent accuracy rate in ranking the superintendents
compared to their internal ranking based on performance and to the profits
generated by the projects they managed. These interviews also found that the
construction industry executives appreciate comparative studies of this kind that
provide data regarding their company’s workforce in relation to other companies.

5. References

Abberger, B., McComb, G., & Spragins, B. (1997). Operations management trends
for 1998 and beyond. Retrieved July 20, 2006 from
http://www.constructioneducation.com/Summer97Page27.htm
Adams, Dan (2007) - Leadership Profile of the Superintendent, Theses presented in
Partial fulfillment of the requirements for the Degree Master of Science, Arizona
State University
Kotterx, J. P. (1990). A Force For Change How Leadership Differs Form
Management. New York: Free Press.
Post, N. (1998). Building teams get high marks. Engineering News Record, (ENR),
240 [19], 32.
Skipper, C., & Bell, L. (2006). Influences impacting leadership development.
Journal of Management in Engineering, 22(2), 68-74. Retrieved May 20, 2006,
from
http:/ascelibrary.aip.org/getpdf/servlet/GetPDFServlet?filetype=pdf&id=JMENE
A000022000002000068000001&idtype=cvips
Zenger, J. H., & Folkman, J. (2002). The Extraordinary Leader Turning Good
Managers Into Great Leaders. New York: McGraw – Hill.

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AA119
[Professional Presentation]
Application of IPMA/PMA Standard Documentation on a Construction
Project Located at Romania – Modulation of PM-Office Standard
Documents According to the ISO 9001:2008 on the basis of IPMA

Baltas M.

Abstract
The present abstract refers to the presentation and analysis of the methodology
and standard documentation, through which the efficient management, control and
coordination of the construction project, located at Copaceni – Romania, were made
possible.

Project ID

The individual characteristics of the project and the contract relations that define
the progress of the project are:
 Description of the project: The owner of the project has at his possession a
site at Romania of total area 38.772,40m2. On the site are planned to be built
3 individual industrial and corporate buildings (production building, office
building, storage building). An underground fire safety water tank and a
pump station are also to be constructed. The total constructed area of the 3
buildings and the water tank together is 8600m2. It is worth mentioning that
the designs and blueprints of the buildings had already been carried out by
engineers at Romania before the establishment of the Project Manager at the
project.
 Location of the project: Copaceni , Ilfov Prefecture Romania
 Project Budget : 3.620.000,00€
 Corporation owning the project: “B”
 Project Owner and representative of the owning Corporation: “Mr. A.”
 Construction Contractors:
1. Structure and load bearing elements works
2. Electromechanical works
 Project Management Team:
1. Project Manager : Baltas Manolis
2. Assistant Project Manager : Poulios Makis
3. Project team member: Kaminaris Tasos
4. Project team member: Baltas Sokratis
 Engineering Experts
1. Civil Engineering : Manolatos Grigoris
2. Electro-Mechanical Engineering: Tripidakis Jonh
3. Electro-Mechanical Engineering: Kaminaris Andreas

“Nature & Problems” of the Project

 The nature of the project (scientific, engineering, management and financial

issues)
 The specific problems that emerge because of the location af the project
(scientific standards, construction methods, project culture)

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 The complexity of the individual company organization of each participant in

the project organization (owner, contractors, pm office)
 The clarification of methods concerning project management via contract
terms
The above described, four key project factors DICTATED the application of a
“special standardized documentation” during the project start, project control and
project coordination:
 in order to all of these three phases to be successful.
 In order to orientate the contractors to follow the P.M. norms
 in order to construct the project
o in time
o in budget
o and in quality standards
 in order to deliver a constructed building to the Project Owner that meets his
needs and demands
The above stated standard documents were created on the basis of the IPMA/PMA
methods. Obligatory, but minor from our point of view, changes were made in order
to meet all the “special principles” of the project and the professional reality.

Results

 The methods used for monitoring and formatting the project

 The “loyal” following of all the P.M. methods that were agreed
 The rigid stance of the Project Manager, during the project start phase,
according to the use of this standard documentation by the contractors
Have all lead to the:
 Distinct, efficient, and pleasant project management resulting a significant
save of resources.
 Significant improvement of the construction works schedule by the contractor
in quality terms
 Excellent and smooth progress and implementation of the construction
contract in terms of quality, time and budget
 Authorization of the P.M. by the project owner to act as if he was the project
owner according to certain decisions concerning the project. This
authorization came as a result of the mutual trust and appreciation
relationship that was founded because of the transparency throughout all the
project phases.
Finally and not less important, the use of this standard documents since the start of
the project till today, has improved the existent monitoring, control and
coordination system that our company has already established. As a result these
standard documents are part of the COMPANY’s documentation that we abide,
following the ISO 9001:2008 norms.

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AA012

An MCDA Approach for Project Selection in Public Sector

Evangelos Bellos
(Researcher, National Technical University of Athens, Greece)

Dimitra Voulgaridou
(Research & Teaching Associate, University of the Aegean,Chios,Greece)

Konstantinos Kirytopoulos
(Assistant Professor, University of the Aegean,Chios, Greece)

Dimitrios Panopoulos
(Researcher, National Technical University of Athens, Greece)

Abstract
Effective and efficient selection of projects is a crucial issue for every organization
and should be aligned with its vision and strategies. The decision making process is
highly complex, especially for public organisations, as it encompasses various, often
conflicting criteria. Moreover they have to consider a much larger picture than
private organisations and many scholars argue that public investment decisions fall
into the category of constrained optimisation problems. The present study develops
and proposes an approach for the prioritization of public projects, based on the
Analytic Network Process (ANP), which is further validated through a real case
example concerning the project selection process of a Greek municipality. The
results indicate that social and political criteria dominate the decision making
process, while the ANP documents the results in such way that they can be
communicated to various stakeholders, ensuring public trust and establishing a
system of transparency in public administration.

Keywords
Project Selection, Multicriteria Decision Analysis, ANP, Public Sector

1. Introduction

Project selection is a long lasting problem in business. Since finite resources exist at
each period of time, the senior management of each organisation should decide
which projects to undertake out of a set of potential alternatives. Effective project
selection may lead to the prosperity or decline of an organisation, thus the problem
has attained the focus of both practitioners and academics. In order to come up
with a decision, the senior management of an organisation should analyze and
evaluate the economical and technical feasibility of each project, evaluate
alternatives, secure financing etc. (Fitsilis et al., 2008).

The problem is even more interesting and difficult to be solved for a public
organization. In this cases, apart from the typical set of criteria such as technical
(e.g. maturity of implementation), economic (e.g. investment cost) or those related
to sustainability (e.g. environmental impact) the decision makers have also to take
into account political criteria (e.g. mission and strategic policies) or social ones
(e.g. contribution to employment). Thus the problem is further aggravated due to
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the various tangible and intangible characteristics that need to be taken into
account. The complexity of the decision environment and the strategic importance
for the organisation leads to the need for a multicriteria decision analysis approach
(Kirytopoulos and Voulgaridou, 2008). Although the number of MCDM methods is
already big and still increases, there is no specific, generally accepted, method for
every selection problem as each problem is unique (Kirytopoulos et al., 2008). In
this paper the Analytic Network Process (ANP) method is selected for the analysis of
decision criteria and alternatives. The scope of this paper is twofold. First the paper
emphasises on revealing the criteria that have to be taken into account in public
project selection. Second the paper offers a comprehensive approach on how ANP
can be used to aid decision making in the aforementioned problem.

The rest of this paper is organised as follows. The second section offers a brief
literature review on public project selection criteria. The third section is divided in
two sub-sections where the analytic network process and its implementation on the
public projects’ selection are elaborated. The paper concludes with the last section
where basic findings are discussed, minor limitations of the approach proposed are
underlined and further research ideas are offered.

2. Literature Review

Effective and efficient selection of projects is a crucial issue for the viability of every
project-based, private or public organization. Management decisions concerning the
prioritization of projects proposals and the determination of the appropriate
investment plan are guided by both intrinsic and extrinsic criteria (Mohanty, 1992).
The intrinsic criteria concern the resources requirements and availability, the
experience of the organization in managing similar projects, the management’s
perspectives and the time horizon of the projects. The extrinsic criteria concern the
risk/return ratio, the target-market needs, the governmental policies and
regulations, the socio-economic climate and the legal and technological
implications. The selection criteria can be further specified depending on the
organization or the project type.

As far as public organizations are concerned, the project selection process becomes
even more complex. The great number of stakeholders, whose interests may be
conflicting, introduces major difficulties into the decision-making phase. Zanakis
(1995) argued that political factors related to a project play much more leading role
than technical or other more rational considerations. According to Chapman (2006),
public project investments involve great capital engagement, uncertainty and long
lasting impacts. Furthermore, it is difficult to assess the value of a project, as it is
affected by dynamic changes of the surrounding socio-economic environment
(Medaglia et al., 2008).

When comes to public project selection criteria, apart from targeting at the
maximization of net financial benefits or returns to stakeholders, decision makers
should also prioritize and select projects through social equity, economic and
political criteria (Medaglia et al., 2008). Puthamont and Charoengam (2007)
indicated 32 factors that influence public project selection during the conceptual,
design and the final approval stage of the selection process. The identified factors
are related to the organization strategy, the project’s rationale, feasibility,
investment analysis, maturity, benefits/impacts and socio-economic and political
environment. In Spain, R&D public projects (Santamaria et al., 2010) are appraised
through the compliance of project’s goals with governmental strategies, the
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innovativeness and technological development of a project, quality, applicability of

project results etc. In addition, the project selection may be guided by the
project’s region and the project’s size.

3. Proposed Approach

3.1 The Analytic Network Process

The Analytic Network Process is a generalisation of the Analytic Hierarchy Process

(AHP) developed by Thomas Saaty (1996). ANP incorporates feedback and
interdependent relationships among decision criteria and alternatives and provides
a general framework to deal with decisions without making assumptions about the
independence of higher level elements from lower level elements or the
independence of the elements within a level as in AHP. In fact, the ANP uses a
network of elements without need to specify levels (Saaty, 2005). Technically, the
model consists of clusters and elements. As in the AHP, the dominance or relative
importance of influence is the central concept and judgments are provided from the
fundamental scale of the AHP (Saaty, 2005) by answering the question: Given a
criterion X, which of the two elements Y,Z is more dominant with respect to that
criterion? In order for the influences among the elements to be meaningful at the
final stage of the method (synthesis), a specific element, each time, is used to
perform the pairwise comparisons. This element is called control criterion. In short,
the ANP approach handles interdependence among elements by obtaining the
composite weights through the development of a ‘supermatrix’.

3.2 The Proposed ANP model for public project evaluation

The proposed model applies the ANP to the problem of evaluating, prioritizing and
selecting public projects. The model has been validated through a real case
implementation concerning the prioritization of three different public projects for a
Greek municipality, within the frame of the development of its annual
programs/actions plan. The referred municipality is located in a depressed area
near Athens and 10 years ago had suffered from a big earthquake, which caused
serious damages in most public infrastructures. The projects, which were examined
in order to validate the proposed model, have been selected with the contribution of
the technical director of the municipality who was asked to propose the three most
important projects that should be implemented during the next year, according to
his opinion. In this matter the following projects were examined:

1. Repairs on earthquake-stricken roads and buildings (short name: EARTHQ),

referring to specific infrastructures damaged by the earthquake, which have not
been repaired yet. Estimated budget 7 million euros, external funding 0.3 million
euros, high maturity of implementation.
2. Bioclimatic reconstruction of the central square of the municipality (short name:
BIOCL), including a total reconstruction of the square on a basis of bioclimatic
design using cool barrier technologies and relevant planting. Estimated budget 0.5
million euros, external funding 0.25 million euros, low maturity of implementation.
3. Development of a web portal for the municipality (short name: PORT), offering
e-government services to the citizens. Estimated budget 0.3 million euros, external
funding 0.225 million euros, low maturity of implementation, high urgency (open
call for proposals).

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The purpose of applying the proposed model was to prioritise these projects on the
basis of a set of specific criteria, with the use of the Analytic Network Process. The
ANP processes were made by using Super Decisions Software created by Saaty
(2004) to alleviate the mathematical burden. The framework of the method is
illustrated through seven steps:

Step 1- Model construction: To develop the public project evaluation ANP model,
fist, the authors performed an extended literature review concerning the evaluation
criteria in the public sector and then interviewed the public project managers about
the critical factors that need to be taken into consideration in order to choose
among the different candidate projects. These factors were initially compiled as a
long catalogue with overlapping data and redundancies. Afterwards, they were
reviewed and categorised into clusters. These final clusters and criteria were
communicated to the public project managers, hereafter referred as decision
makers, who, after some minor corrections, verified the final model. From a
technical point of view, the structure of the ANP model is described by its clusters
and elements and the connection between them. These connections indicate the
flow of influence among the elements. The resulting model is illustrated in Figure 1
and consists of six clusters:

1. The 1ECONOMIC cluster controls the economic viability of the decision and
consists of two elements: the Investment Fundability (representing the chance of
allocating sources for funding the project, including the possibility of receiving
external funding, e.g. through Operational Programmes of the Greek National
Strategic Reference Framework and the Investment Financial Analysis (evaluating
financial indexes like ROI, IRR, etc).

2. The 2POLICY/POLITICAL cluster consists of the main elements that determine

policy-related criteria such as the compliance of the project to the Organisation’s
Mission and the Strategic Policies, the Urgency of the project (taking into account
not only the real urgency for covering a specific need, but also possible deadlines
concerning opportunities for ensuring external funding for the project) and the
projected Public Perception of each project.

3. The 3SOCIAL cluster is related with the impact of each project to the citizens and
the society, consisting of two elements, the first one concerning the possible
benefits for the society and the second one concerning the contribution of the
project to local employment.

4. The 4SUSTAINABLE DEVELOPMENT cluster encompasses all those elements

concerning the environment and the regional development. These elements
include: the Environmental Impact of the project (in the local region, as well as in
national level) and the general projected contribution of the project to Local
Development.

5. The 5TECHNICAL cluster controls the technical characteristics of each project

that influence the final decision and consists of the project’s Maturity of
Implementation (concerning the status/availability of prerequisite factors for
implementing the project like relevant studies, resolved legal issues, reassurance of
equity capital, land expropriation needs etc), the Availability and Technical Ability of
the Human Resources of the Organisation for monitoring the project and possible
Regulatory Needs (in the terms of requirements for completing any regulatory/legal
actions as prerequisite for implementing the project).
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6. Finally, the 6ALTERNATIVES cluster comprises all candidate projects as described

previously on this subsection.

Fig 1: The Public Project Evaluation ANP Model

The connections among the clusters and elements are depicted in Figure 1 with
arrows. The definition of these connections can only be defined by the decision
makers, the public project managers in the present case, who are expert in terms
of knowing how the elements interact in the real environment. For example, the
arrow from the cluster 2POLICY/POLITICAL to the cluster 4SUSTAINABLE
DEVELOPMENT, captures the notion of outer dependence of ANP and is interpreted
as follows: some of the elements in cluster 4SUSTAINABLE DEVELOPMENT
influence some of the elements in cluster 2POLICY/POLITICAL (Specifically, the
Public opinion/perception is influenced by Environmental Impact and Contribution to
Regional/Local Development). Finally, the concept of inner dependence of ANP
(some elements of a cluster influence other elements of the same cluster is
depicted with a feedback loop. Refer, for example to the loop above the
5TECHNICAL cluster, which represents the fact that Maturity of implementation is
influenced by both Human Resources (ability & availability) and Regulatory
requirements. The volume and the diversity of the criteria identified during this
step, reveal the complexity of the decision problem in the public project evaluation
environment.

Step 2- Clusters’ pairwise comparisons and Clusters Priority Matrix: After

the model was constructed, an additional meeting between the authors and the
public project managers took place, during which the managers were asked to
respond to a series of pair wise comparisons with respect to a control criterion. The
elements in a cluster are compared by applying Saaty’s 1–9 scale (Saaty, 2005)
according to their influence on an element in another cluster to which they are
connected or on elements in their own cluster, as described above. “Super
Decisions” software is able to calculate the inconsistency ratio for each comparison
matrix, so the most consistent value for the entries can be determined. The
inconsistency measure is useful for identifying possible errors in judgments as well
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as actual inconsistencies in the judgments themselves. For example, if A is more

important than B and B is more important than C, C cannot be more important than
A. In general, the inconsistency ratio should be less than 0.2. Afterwards, the
Clusters Priority Matrix is constructed. Its columns consist of the weighted priorities
derived during the pair wise comparisons.

Step 3- Elements’ pair wise comparisons: in order to compare the elements of

the clusters, the same procedure described in the former step was followed.

Step 4- Formation of the SuperMatrix: The priorities of the elements are

arranged both vertically and horizontally according to clusters. This matrix is known
as SuperMatrix. Each vector taken from a paired comparison matrix is part of the
column of the SuperMatrix representing the impact, with respect to the control
criterion of the elements of that cluster on a single element of the same or another
cluster, listed at the top.

Step 5- Formation of the Weighted SuperMatrix: The weighted priorities at the

Clusters Priority Matrix are used to weight all the elements in the block of column
priorities of the SuperMatrix corresponding to the impact of the elements of that
cluster on another cluster. This process is repeated for all the clusters resulting in
the Weighted SuperMatrix.

Step 6- Formation of Limiting Matrix: The Limiting Matrix and the system’s
solution derives from multiplying the Weighted SuperMatrix (step 5) by itself, which
accounts for variable interaction, until the system’s row values converge to the
same value for each column of the matrix. This ‘power method’ process yields the
limiting matrix, which provides the relative importance weights for every element in
the model (Niemira and Saaty, 2004). The final results, weights of criteria and
prioritization (normalized values) of public projects under evaluation as derived
from the limit matrix are graphically depicted in Figures 2 and 3, respectively.

Step 7- Sensitivity analysis on the final outcome: Sensitivity analysis is

concerned with ‘what-if’ kind of questions to determine if the final answer is stable
to changes in the inputs, either judgements or priorities. Of special interest is to
see if these changes alter the order of the alternatives. The sensitivity analysis
performed with respect to Impact on society, which is the dominant criterion (refer
to figure 2), showed that irrespective of its value, the rank of the projects is
preserved. Performing similar sensitivity tests for other criteria led to the conclusion
that the outcome is very stable and does not change the overall rank.

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3Regulatory requirements
2Human resources (availability  & ability)
1Maturity of implementation
2Contribution to regional/local …
1Environmental Impact
2Contribution to employment
1Impact on society
3Public opinion/perception
2Urgency
1Mission and strategic policies
2Investment financial analysis …
1Investment Fundability

Fig 2: Final weights of the decision criteria

3Web‐portal development 32.18%

2Bio‐climatic reconstruction of central 
26.29%
square
1Repairs on earthquake‐stricken roads & 
41.52%
buildings

Fig 3: Prioritization of projects

4. Conclusions

The evaluation and selection of public projects is a difficult endeavour as it takes

into account many conflicting criteria, both tangible and intangible. The present
study proposed an MCDA approach based on the ANP that is capable of capturing
this complex decision environment. The ANP method, as part of this approach,
enables the decision maker to visualize the impact of various criteria in the final
outcome and documents the evaluation results in such way that they can be
communicated to various stakeholders, ensuring public trust and establishing a
system of transparency in public administration. Although the case study presented
in this paper concerned a limited number of projects, ANP is capable of handling
many more alternative but with the cost of complexity.

For the case study presented here, the results indicate that the project with the
highest priority is the Repairs on earthquake-stricken roads and buildings followed
by the Web-portal Development and the Bio-climatic reconstruction of central
square (refer to figure 3). Moreover, the most dominant criteria that influenced the
decision were found to be the social (e.g. Impact on Society) and the political
criteria (e.g. Public opinion/perception, Urgeny) followed by economic criteria (e.g.
Investment Fundability). The results indicate that, under the current conditions and
according to the public projects managers’ value system, social and political criteria
are favoured over economic criteria, which explains the fact that a project with
major socio-political impact dominates over more economic compensative projects.

The ANP approach proposed by this paper bears also a few limitations. The most
important is considered to be the fact that the outcome of the model depends on
the inputs provided by the public managers. Moreover, the formation of the
pairwise comparison matrices is a time-consuming and complex task. Finally,
inconsistency may also occur, leading to doubtful or wrong results.
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This study raises several important issues that could spark further research. The
most important is the evaluation of the model and its implementation at additional
case studies in related public organisations. Such an endeavour might be beneficial
and result in developing a complete system that could support the decision makers
and reveal the significance of certain alternatives, criteria and elements.

5. References

Chapman, C., Ward, S. and Klein, J. (2006), “An optimised multiple test framework
for project selection in the public sector, with a nuclear waste disposal case-
based example”, International Journal of Project Management, 24, 373-384.
Fitsilis, P., Kirytopoulos, K. Leopoulos, V., Pantouvakis, J.P. & Saridakis, I. (2008),
“Requirements for assessing the managerial capability of organizations
implementing projects of public interest – the Greek Standard ELOT-1429”,
Proceedings of the PM-04 > 4th Scientific Conference on Project Management &
1st IPMA / MedNet Conference, CCI – NTUA, Chios 29-31 May, 530-536.
Kirytopoulos, K. and Voulgaridou, D. (2008), “Sub-Contractor Selection Decisions
via a Multicriteria Model”, Proceedings of the PM-04 > 4th Scientific Conference
on Project Management & 1st IPMA / MedNet Conference, CCI – NTUA, Chios
29-31 May, 204-209.
Kirytopoulos, K., Leopoulos, V. and Voulgaridou, D. (2008), “Supplier selection in
pharmaceutical industry: An analytic network process approach”,
Benchmarking: An International Journal (BIJ), 15(4), 494-516.
Medaglia, A., Huethb, D., Mendietab, J-C., Sefaira, J. (2008), “A multiobjective
model for the selection and timing for public enterprise projects”, Socio -
Economic Planning Sciences, 42, 31-45.
Mohanty, R.P. (1992), “Project selection by a multiple- criteria decision-making
method: an example from a developing country”, International Journal of
Project Management, 10(1), 31-38.
Puthamont, S. and Charoenngam, C. (2007), “Strategic project selection in the
public sector: Construction projects of the Ministry of Defence in Thailand”,
International Journal of Project Management, 25, 178-188.
Saaty, T. (1996), Decision Making with Dependence and Feedback: The Analytic
Network Process, RWS Publications, Pittsburgh, PA.
Saaty, T. (2004), Super Decisions Software, RWS Publications, Pittsburg, PA
Saaty, T. (2005), Theory and Applications of the Analytic Network Process. Decision
Making with Benefits, Opportunities, Costs and Risks, RWS Publications,
Pittsburg, PA.
Santamaria L., Barge-Gil, A. and Modrego, A. (2010), “Public selection and
financing of R&D cooperative projects: Credits versus subsidy funding”,
Research Policy, (article in press).
Zanakis, S.H. and Mandakovic, T. and Gupta, S.K. and Sahay, S.and Hong, S.
(1995), “A review of program evaluation and fund allocation methods within the
service and government sectors”, Socio-Economic Planning Sciences, 29(1),
59–79.

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AA007

Measuring Performance and Implementing Improvements

(Case study)

Ioannis Bras
(Managing Director, Superior Services, Greece)

Abstract
The period between 1999-2002 a first-hand applied research was based in one of
the biggest corporations in England (UK) in the Project Management field. The
target was to create the suitable tools, techniques and methodologies in a practical
measurable environment where departments of the company which affect the
effectivity and viability of a project to be analyzed so that their effectiveness can be
measured and ways and mechanisms of improvement can be found.

It was decided that the start would be made from a project of a budget of € 270
million whose cause was the research and construction of a nuclear laboratory in
Shellafield UK.

The department initially chosen to be examined and ways of measuning

effectiveness to be found, but also methodology of optimizing the services offered,
was the Information Technology department since it offered its services to more
than 400 engineers.

The paper will cover the concept design, the methodology and tools used as well as
the results of the improvements acted out in the period of two semesters when the
research was held.

Keywords
Project Management, Performance Measurement, Improvement implementation,
Process mapping, Results charting, Workshops, Service optimisation

1. Introduction

Global corporations consume much energy as well as money in order to be able to

make their manpower and also the services provided from one department to the
other productive.

The research (R&D) was based in one of the largest corporations in England (UK) in
the Project Management field, AMEC, in the department of AMEC Nuclear. The
plan was to create the suitable tools, techniques and methodologies that will
measure actual performance and then implement change via specific actions for
each area.

It was decided that the start would be made from a project of a budget of € 270
million whose cause was the research and construction of a nuclear laboratory (B41
Building). The project was under a series of projects (total budget € 10 billion)
whose cause was the first ever closing down of a nuclear reactor in Shellafield UK.

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The department initially chosen to be examined and ways of measuring

performance & effectiveness was the Information Technology department since
it offered its services to more than 400 planning engineers.

This paper will cover the concept design, the methodology and tools used as well as
the results of the improvements acted out in the period of two semesters when the
research was held (May 2000 – December 2000).

2. Tools & Management Techniques

The main objectives for this project were: ’’To capture, analyse, report and
make improvements to the IT service for the Alliance projects’’.

The first step was to analyse and process map all of IT’s activities and man power
(Chart 1).

IT ORGANOGRAM
IT
MANAGER
HELP DESKTOP INFRASTRUCTURE
SUPPORT DEVELOPMENT
DESK SUPPORT

1ST LEVEL 2ND LEVEL 3RD LEVEL

SUPPORT SUPPORT SUPPORT

RESPONSIBILITY CHART

HELP DESK DESKTOP 3RD LEVEL DEVELOPMENT

SUPPORT
- CALL LOGGING - ASSET MANAGEMENT - MICROSOFT
- CALL CLOSE OUT - NETWORK ACCESS
- USER UPDATES - ADMINISTRATION - INTRANET
- ORDERING - SUPPORT - ANTI-VIRUS
(PROCESSING) - HELP DESK (SITE) - TRAINING
- USER ASSISTANCE - INSTALLATION HARDWARE /
(OFFICE SUITE) SOFTWARE
- STOCK MANAGEMENT - VIDEO CONFERENCE
- 1 LEVEL - 2ND LEVEL
TROUBLESHOOTING TROUBLESHOOTING
- PRINTER QUERIES/ - TRAINING - LOTUS NOTES
TONER
- SERVER ADMIN.
REPLACEMENT
- BACKUP /ARCHIVES
- USER ACCOUNT
2ND LEVEL - INSTALLATIONS
MANAGEMENT
- TRAINING
(LOG IN ID ADMIN)
- INSTALLATION HARDWARE / - PRIMAVERA SUPPORT
- TRAINING CO-
ORDINATION SOFTWARE
- LOAN OF EQUIPMENT - NETWORK MANAGEMENT
CONFIGURATION
- PRINTER / PLOTTER
INSTALLATION
- LAPTOP CONFIGURATION /
INSTALLATION
- SERVER MAINTENANCE
- 2ND LEVEL
TROUBLESHOOTING
- TRAINING

Chart 1: IT Organogram

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The second step was to develop a Business Process Map (Chart 2) that would
assist on understanding the process followed and therefore would make easier for
the IT people and the engineers participating to ‘’buy-in’’ to the process.

Chart 2: IT Business Process Map

The process map started by setting the principal objectives which also were by
definition the Minimum Conditions Of Satisfaction (MCOS). Next, the management
team set the Critical Success Factors (CSF’s) for this Project.
These can be summarized as follows:
 Provide effective and efficient support to the Project Team (Home office, Site
and Mobile).
 Equipment and applications must be reliable, robust and maintainable, with
the flexibility for expansion/enhancement (Network, individual PC’s and
equipment, applications, training, help desk, response data etc.)
 Applications must be user friendly, with simple operating instructions.
 Trained personnel, with demonstrable competency.
 Provide networked applications and communication, including mobile users
and corporate offices.
 IT budget approval and control (spend profile).

The best way to move forward and set the desired standards was through the
creation of a questioner that represents all aspects of IT, physical performance of
people, software, hardware and problem solving.

The questionnaire (Table 5 Question 1-13) was structured in such manner that
covered all aspects of the working environment and future changes.

The scoring methodology followed can be summarised in table 1:

Scoring: Definitions:
A. 0-20% Total Failure Cannot perform my role effectively
B. 21-40% Failure Impacts my ability to perform my role
C. 41-50% Less than adequate Functions but needs improvement
D. 51-70% Meet requirements Satisfactory
E. 71-100% Exceeds requirements More than Satisfactory
Table 1: Scoring methodology

It was then necessary to set the Key Performance Indicators (KPI’s) as a

percentage of acceptable performance (Performance Levels) and was decided to
have a uniform target of 70% performance target level.
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(Where Actual Score =D+E/2). (1)

(D=Score between 51-70% & E=Score between 71-100% (Table.1))

Before issuing the actual (hard copies) & virtual questioner (via a dedicated intranet
site) a top Managerial letter was issued so that every one in the organization to
know that the particular project was well supported by the management team. The
letter wrote: ‘’As part of our commitment to improve our Business Performance, a
process of collecting, analysing and improving the IT service has been developed.
This is realised through the “IT Performance Evaluation Survey”.

This process, measures the performance of the IT service against agreed Critical
Success Factors, which are regularly revised, to fit our goals of a high performance
organisation.

The process is repeated every six months, with the objective of capturing &
improving areas of the IT service that will result on a better quality visually
enhanced service’’ . A period of 2 weeks was allowed for all questioners to be
collected and analysed.

Next, a number of workshops took place in order to review all the functional
objectives and a ways of best presenting results to be developed. This was
achieved by using presentational Radar Charts (Chart 3) that indicated the target
score (red dotted line) across the actual score achieved (blue shaded area).

Target Improvement
Accessibility
100% Score
Install New Equipment 90% Information
80%
70%

Printing Services 60% Business Needs

55%
50%
68% 40% 43%
30% 57%
20%21%
Level of Pheripherals 62% 10% 43% Time for Response
0%

52% 62%

42% 38%
Remote Links 38% Resolving Faults

61%

Suggestions for Improvement Access to Information

Availability of Systems Access to IT Training

Chart 3. Overall Results of IT Performance Survey (All Projects) May 2000

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Then an individual ‘’Result and Subsequent Improvement Plan sheet’’ (Table 2) for
each question was developed in order to better analyse the What/Why/When and
How much.

Question 1: What is the accessibility of IT staff when you need

them?

Results, May 2000 Scoring: The score is the

percentage of response who
deemed the service to be
100% satisfactory or better (i.e.
90% D+E)
80%
70% A: Cannot perform my
60% role effectively
Score

B: Impacts my ability to
50% 55% perform my role
40%
C: Functions but needs
30%
29% improvement
20%
D: Satisfactory
10% 4% 12% E: More than Satisfactory
0%
A B C D+E
Category
Improvements
/Action Help desk/Mobile phone

 Man help desk/Introduce mobile phone help number

Action  Review resources across IT function
 Formalise hours of office coverage
Proposed date
for completion
24/07/00

 Staff numbers have been increased to ensure that the

Helpdesk is now permanently manned.
 Mobile phones are being procured for Both Swinton and
Sellafield use. Their usage and contact details will be issued
shortly.
 Resources have been reviewed across the IT function,
leading to an extra member of staff for Sellafield support in
addition to the extra helpdesk staff. Risley (BTC) already
Progress
to-date
has a dedicated full time support engineer.
 The IT helpdesk will be manned from 7:30 am until 5:00pm
Mon-Thurs. Earlier finish may occur on Friday pending office
occupation level.
 In any instance, if the Helpdesk cannot be contacted, the
Mobile phones will be manned within Helpdesk hours and
beyond.
 Cover outside of office hours will only be available by prior
arrangement.
December
2000 target
70%

Table 2. ’Result and Subsequent

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A generic improvement plan was issued (Table 3) with all questions, scores and improvement plans so that the whole process was
visible to all staff across all projects.

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Upon completion of the improvement plan, actions had to take place and an ‘’OPEN
WALL’’ tool where anyone could write their comment, question or suggestion to be
introduced. This increased the visibility of this project and gave the opportunity to
employees for direct involvement other than filling the questioner.

It was decided to repeat the whole process six months later (Chart 2) so that
changes will take effect and the main objectives together with all the improvements
suggested to fully service the Critical Success Factors for this Project.

After the completion of the second round the presentational Radar charts were as
follows (Chart 4):

Target Improvement

Score Dec 2000

Accessibility Score May 2000
100%
Install New Equipment 90% Information
80% 79%
70%
Printing Services 60% Business Needs
50% 48% 71%
46%
40%
30%
65%
20%
Time to respond to approved
Level of Pheripherals 61% 10% 37% purchuse requests
0%

55%
90%
19%
Remote Links 44% Resolving Faults
45%
63%
Suggestions for Improvement Access to Information

Availability of Systems Access to IT Training

Chart 4 Overall Results of IT Performance Survey (All Projects)

December 2000

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A new evaluation & improvement plan was derived (Appendix1 - Table 4) and the
whole process started again. It is very visible to all where improvements have
taken place and where the process needed further improvements.

3. Conclusions

The company invested time and man-hours to develop a project management tool
that will allow the measurement & improvement of its IT departments across a
segment of projects in the nuclear area (Appendix 2).

Making the process visible to all via the introduction of a dedicated intranet site and
in parallel introducing an Open-Wall policy for suggestions, comments & remarks,
ensured the ‘’Buy-in’’ of this project from all. Very important role played the
managements support for the whole process and its dedication to continue
improvements. As the process continued new higher KPI’s were set (Appendix1 -
Table 6 – September target) in order to continue the improvement process and
reach higher performance.

After the completion of the second stage of this process it was clear that the whole
IT service had been improved and IT staff was more aware of change than ever
before. Finally, it was decided this process to be followed across the company and
its characteristics to be branded as Best Practice.

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Appendix 1.

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Appendix 2.

December 2000 IT Performance Measurement Summary Results

Chart 3.1 Overall results of IT Performance Surveys
December 2000

Accessibility
100%
Install New Equipment 90% Information
80% 79%
70%
Printing Services 60% Business Needs
50%
46% 40% 48% 71%
30%
65%
20% Time to respond to approved
Level of Pheripherals 61% 10% 37% purchuse requests
0%

55%
90%
19%
Remote Links 44% Resolving Faults
45%
63%
All B41 Personnel Suggestions for Improvement Access to Information
BTC Risley
Target Improvement
Overall Results of IT Performance Survey (All B41 Personnel) Availability of Systems Access to IT Training Overall Results of IT Performance Survey (BTC RISLEY)
DECEMBER 2000 DECEMBER 2000
Score Dec 2000
Accessibility Target Improvement
Accessibility Target Improvement Score May 2000 100%
Score Dec 2000
100% Score Dec 2000 Install New Equipment 90% Information
Install New Equipment 90% Information 80%
80% 82% 70%
70% Printing Services 60% 57% Business Needs
64%
Printing Services 60% Business Needs 50% 50%
50% 53% 40%
73% 57%
66% 40% 30% 57%
30% 20%
Level of Pheripherals 14% Time to respond to appr. purchuse requests
20% Time to respond to appr. purchuse 10%
29%
Level of Pheripherals 65% 14%
10% 40% requests 0%

56%
0%

20%
89%
All Sellafield Personnel Remote Links
43%
14%
100%
Resolving Faults
44% 42%
Remote Links Resolving Faults Overall Results of IT Performance Survey (Sellafield) 67%
DECEMBER 2000 71%
63%
Suggestions for Improvement 83%
Access to Information
Suggestions for Improvement Access to Information Accessibility Target Improvement
100%
Score Dec 2000 Availability of Systems Access to IT Training
Install New Equipment 90% Information
Availability of Systems Access to IT Training
80% 78%
70%

B41 Swinton
Printing Services 60% Business Needs
50%

All Thorp Personnel

78%
40%
30%
33% 56%
20%
20%
Time to respond to appr. purchuse
Level of Pheripherals 67% 10%
Overall Results of IT Performance Survey (B41 SWINTON) 22% requests
DECEMBER 2000 0% Overall Results of IT Performance Survey (THORP)
44% DECEMBER 2000
11% 78%
33% 33%
Accessibility Target Improvement Accessibility Target Improvement
Remote Links Resolving Faults 100% 100%
100%
Score Dec 2000 Score Dec 2000
Install New Equipment 90% Information 56% Install New Equipment 90% Information
83% 80%
80%
75% 70%
70%
Suggestions for Improvement Access to Information
Printing Services 60% Business Needs Printing Services 60% Business Needs
57%
50% 50%
40% 76% Availability of Systems Access to IT Training 67% 40%
60% 67%
30% 30% 33%
20% Time to respond to appr. purchuse 20%
Level of Pheripherals 65% 43% Level of Pheripherals 67% Time to respond to appr. purchuse reque
10% requests 10%
0%0%
0%
0% 0%
0%
59%
91%
22% 33% 100%
Remote Links 47% 43% Resolving Faults
Remote Links Resolving Faults

61% 67%

67%
Suggestions for Improvement Access to Information
Suggestions for Improvement Access to Information

Availability of Systems Access to IT Training

Availability of Systems Access to IT Training

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A002
Effectiveness of risk management: Barriers and solutions

Andy Carter
(Senior Consultant, EC Harris, Birmingham, UK)

Ezekiel Chinyio
(Senior Lecturer, University of Wolverhampton, Wolverhampton,UK)

Abstract
The effectiveness of risk management within the UK construction industry is
discussed. A semi-structured questionnaire was used in collecting both qualitative
and quantitative data. 113 construction professionals were sampled who included
project managers, clients, quantity surveyors, and contract experts. 46 replies were
received, representing a 40% response rate. The quantitative data were analysed
by descriptive statistics while the qualitative data were synthesised by the content-
identification of opinions made. Results of the analyses showed that most
respondents use a structured approach; and manage risks throughout the different
phases of a project. They also feel that the risk management process is fairly okay
but some barriers were identified, e.g. making a late start, using inexperienced
personnel, not fully pro-active, etc. In view of these, solutions for improvement
were proffered such as providing adequate training, not circumventing some steps
in the process, etc.

Keywords
Project management, risk management, project success, contract management,
tools and techniques.

1. Introduction

The construction industry is subject to more uncertainty and risk than many other
industries because many of its projects are complex, generally bespoke and entail
time consuming design and production processes. Risks in construction can also
come from external factors which can be beyond the control of those involved in a
project. The fact that most construction requires a multitude of people with varying
skills, abilities and interests adds to the risks associated with projects as conflicts
can arise in the relationships amongst participants. Risk can impact on project time
and cost, sometimes significantly. According to Latham (1994) “No construction
project is risk free”. Therefore, all the underpinning sources of risks in a project
should be addressed to forestall or minimise their consequences.

Risk management is not new and its techniques are well documented. So it is the
implementation of risk management that has to be done efficiently. On this basis, a
research was carried out to investigate the efficacy of risk management within the
UK Construction Industry with particular emphasis on barriers and solutions to this
activity. The next section of the article reviews risk management, after which the
research method is discussed. The findings and conclusion are presented towards
the end.

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2. Risk Management

Risks are associated with uncertainty. A type of risk which is prevalent in

construction is ‘exposure to accidents or hazards’. This type of risk tends to
emphasise a downside, however, uncertainty can yield an upside. Contractors’ bids
often include an allowance for risks and if some of these do not materialise in the
course of a project, then the profit margin becomes higher than expected. So there
is a positive dimension to risks.

Construction risks are always many and it is often impossible to eliminate these all
(Simon et al., 1997). So means of coping with risks have to be established in each
project (Kangari, 1995; Franks, 1998). Risk Management assists organisations to
address the downsides attached to their activities. It adds sustainable value to an
organisation’s activities and increases their probability of success in their
endeavours while limiting or controlling their chances of failure.

Bernstein (1996) and Boothroyd and Emmett (1996) reckon that modern
risk management is about 350 years old. The process is now associated with
many industries (Raftery, 1994). In the construction sector, the number of
publications on this subject has increased continuously from 1960 onwards
(Edwards and Bowen, 1998). A risk management process will tend to
involve:
1) risk identification, analysis and response and
2) risk control and management.
These two broad aspects are now considered below, being informed by: PMI
(2009) for the first aspect; and IRM (2002) for the second aspect.

2.1 Risk identification

A starting point is to identify the risks in a project. Various means are available and
these include the use of: risk registers, experience, intuition, analysis of
assumptions, analysis of hazards, etc. When risks have been identified, an
organisation can begin to decide on what to do with the known risks. Some risks
may remain unknown but that does not mean that they are not there. Unknown
risks can spring up surprisingly and cause embarrassing and detrimental effects. So
every endeavour must be exercised to identify all risks in a project.

2.2 Risk Analysis

Having identified risks, they should be quantified to establish their potential impacts
on the project are. This should be done objectively and accurately and qualitatively
or quantitatively.

Qualitative risk Analysis: This assessment is done by using the personal

experiences of the risk analysts and reviewing past corporate experiences where
records are available. It can also be achieved with the aid of checklists, interviews,
brainstorming sessions, etc.

Quantitative Analysis: This involves a numerical assessment that may require the
use of a computer software. A detailed quantitative analysis may be carried out
following a qualitative analysis to enable the impacts of the risks to be quantified. A
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quantitative analysis can be carried out by means of sensitivity analysis, scenario

analysis, probability analysis, Monte Carlo simulation, etc.

Smith et al., (2006) observed that “in most analyses only a few key risks are
investigated and … it should be easy to see which those risks are”. This observation
suggests that major risks should not be ignored at the expense of minor risks. Only
a good and effective evaluation can inform the categorisation of risks as either
major or minor.

Once assessed, risks can be categorised into high/low probability of occurrence and
major/minor impact on the project. Also, actions can eliminate or minimise certain
risks. Having mitigated some risks, the assessment is carried out again to establish
the new risk profile of the project. This cycle is repeated several times until all
outstanding risks cannot be mitigated.

2.3 Risk response

This stage of the process involves acting to deal with the risks identified from the
above activities. The generic strategies that are often used to deal with risks are:
Remove, Minimise, Transfer or Accept a risk (Baker et al. 1999). There are many
tactics that can be used in this regard e.g.: identify preventative measures to avoid
a risk or reduce its effect; consider risk transfer to insurers; consider risk allocation
in contracts; etc. Risk response contributes to the iterative assessments referred to
in the previous section.

2.4 Risk control and management

Ultimately, a contract will end up with a set of risks that are assigned to the various
participants who have to own and manage these. A plan of action should be
established for each risk so that an organisation will know what to do when a risk
materialises and that way, avoid surprises. Not all risks will materialise in a project
either by luck or prudent management. It is a welcome relive to an organisation
when a risk fails to materialise.

Each time a risk lapses, it is struck-off the register. Consequently one can see the
risks that are still live or outstanding at each stage of a project. This countdown
continues till the project is finished and all risk issues are closed-off. The Risk
Management process is a continuous process, but is ideally started in a project as
early as possible and sustained throughout the different stages of the project and
including the post-construction phase.

Ideally, a framework for dealing with risks is worth using and most organisations
will have their approach e.g. Figure 1.

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Figure 1: A risk management process model (Source: Institute of Risk

Management, 2002).

2.5 The advantages and downsides of risk analysis and management

Risk analysis and management offers many upsides and these include (Boothroyd
and Emmett, 1996; ICE and FIA, 1998; Burchett et al., 1999; Simon et al., 1997):
Enhanced decision making where several alternatives can be compared objectively;
greater confidence in realising the client’s objectives of cost, time and quality;
improved communication both; better choice of contract; ability to distinction
between good/bad luck and good/bad management; etc.

The process has disadvantages which include (Pouliquen, 1970; CIPFA,

1986; Ranasinghe, 1998; Bernstein, 1996): it does not replace skilful
decision-making; consumes a lot of time; is at times subjective and
unreliable; can be very complex; etc.

3. Research Method

A research was carried out to assess the efficacy of contemporary practice, any
problems being faced and solutions for improvement. A mainly ‘quantitative’
approach was used via a questionnaire as means of data collection. The
questionnaire was issued electronically in July and August 2008, to construction
professionals who included Project Managers, Clients, Quantity Surveyors, and
Contract Experts (Consultants). The questionnaire was administered electronically
(via an internet link) and the results logged and stored externally by an external
questionnaire company.

113 people were approached for data and 46 responses were received,
representing a response rate of approximately 40%. Figure 2 details the types of

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organisations surveyed, i.e. involving clients, contractors and consultants. The

respondents were involved in risk management on a regular basis and could draw
from their wealth of experience to answer the questionnaire.
Figure 2: Types of respondents
50
45
40
35
Percentage

30
25
20
15
10
5
0
Consultants Contractors Clients Others

Those sampled are professionals who can give independent and unbiased opinions;
and their responses seem impartial on face value, especially that they discussed
downsides pertaining current practice without reservation. These downsides are
discussed fully in section 4.2 of this paper.

4. Findings

The respondents were asked whether they used a template for risk management
such as in Figure 1. 91% answered in the affirmative. Most organisations would
adapt a template to suit their own practice and may emphasise risk management at
certain stages of a project.

Figure 3 shows who the respondents felt should drive the risk management
process. The configuration of Figure 3 contrasts with Figure 2, suggesting that the
respondents were not voting for themselves. Many respondents think that clients
should play a leading role in risk (and project) management.

4.1 Effectiveness of the risk management process

As to whether risk management is effective within the project life cycle; Figure 4 is
emphatic of the respondents’ view. The opinion of the respondents is that risk
management is worthwhile.

Figure 3: Who should lead the risk management process?

50
45
40
% of respondents

35
30
25
20
15
10
5
0
Client Contractor Designer Consultant

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Figure 4: Effectiveness of risk management

100
90
s 80
t
n 70
e
d 60
n
o 50
p
s 40
e
r
f 30
o
e 20
g
ta 10
n 0
e
c
r
e Effective Not Effective
P
Respondents' view

4.2 Barriers to risk management

However the respondents felt that the risk management process is not flawless.
Both bespoke and generic flaws were identified as discussed below.

4.2.1 Not sufficiently pro-active: According to one of the respondents: “a lot of

the risk management is reactive and more forward planning is needed. Also in this
regard, the process is often hindered by late changes to the design scope.” This
suggests that assessors sometimes struggle to quantify risks on time.

4.2.2 Not robust enough: The process is also not fully robust. It was suggested
by one of the respondents that some contractors do not often take all aspects of
risk items into consideration. They do this e.g. at tender stage where the risks are
not easily identifiable. Designers too were identified as sometimes not robust with
risk assessments. This practice is adopted either honestly or intentionally in order
for the project to 'appear' healthier than it might be.

4.2.3 Attitude towards risks: The industry was seen as being risk-averse. It was
explained by a respondent that there is “too much focus on transferring risk as
opposed to sharing and managing”.

4.2.4 Incompetency of risk managers: The competency of those who manage

risks was questioned. One of the respondents remarked that there is an “increasing
number of inexperienced staff within the construction industry who are managing
risks”.

4.3 Improving risk management

The flaws identified in the foregoing section are pointers to where and how risk
management can be improved. Accordingly, suggestions were offered by some
respondents on how to improve and these are discussed below.

4.3.1 Make an early start: Risks should be examined very early even before the
design stage and certainly before actual projects commence on site. A committed
and pro-active approach is recommended in this regard where a respondent
remarked that ‘clients should allow programme time at developmental stage for
rationalising risks that have been identified’.
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4.3.2 A sustained process: Having started early, the risk management process
should be sustained throughout the project phases. This can be done through
regular reviews and updates. It was explained that a full review of risk
management at project completion should be carried out so that any lessons learnt
can be carried forward to future schemes.

4.3.3 Assess and prioritise well: Practitioners should thus use every circumspect
means of assessing risks in a project. The idea is to ensure that every risk is
assessed accurately. Sometimes the assessment will point to the key risks that
must be monitored closely. These ‘show stoppers’ are most critical. A respondent
suggested a concentration on ‘ the top 20’ risks which should be assessed at length
while a % sum is added to allow for low risk items.” There is no standard
recommendation on how-much an organisation should estimates for its risks, as the
price is informed by several considerations. However, the assessment should be as
accurate as possible.

4.3.4 Maximise the use of your experience: Experience is very valuable to risk
assessment and management. As explained by one of the respondents, you “need
the right people at the right time”. Another respondent elaborated that “people are
also needed who are unemotionally attached to the project; are informed, and
understand the complexities of the type of project being discussed.” The suggestion
is not to rely on past experience alone but not to discount it.

4.3.5 Right attitude towards risks: The interviews pointed out that rganisations
must promote the concept of risk ownership and responsibility in their culture. An
example should be set by clients and should permeate down the supply chain.
There should be an increased focus on reporting and discussing risks. More
openness is likewise required amongst the consultants in addressing risk issues.
People who own risks should be treated fairly, e.g. a no-blame tactic is worthwhile
as things can go sometimes wrong.

4.3.6 Training: While experience informs risk analysis and management, training
is also important. The quest is to ensure that project specific risks are identified,
not just generic lists. A respondent advised thus: “Involve many people; encourage
geeks and out of the box thinkers.” Another respondent advocated for “Better
education and provision of site based training.” Employees should not be left alone
to face risks. Management support is vital and where employees are seen to be
lacking in knowledge, some form of training should be planned for them.

4.3.7 Minimise informality: The process can be made more formal where
financial penalties can be administered for non-compliance. A respondent suggested
that “regular risk register reviews should become a contract requirement.” The NEC
standard form of contract promotes risk management. Other forms of contract can
be updated to reflect similar or better standards in terms of risk assessment and
management.

5. Conclusion

A response to risks is very important and the respondents in this survey reiterated
this opinion. Construction practice is conversant with risk and often responds to it
by using guides. However, most organisations use their own bespoke frameworks
or templates albeit these include the assessment and management of risks.
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Although risks are managed effectively in the course of construction projects, the
process is not flawless. There is a need to keep reviewing the practices within
organisations to identify lapses that can be corrected.

This research provides a cross-sectional view of construction practice that is coming

from a sample of the population. So, while we cannot be quick to generalise the
findings, we should not dismiss these outright either. What we can infer is that
there are risk management processes that are workable in principle but are
sometimes not implemented fully. One plausible reason for the poor
implementation is the entrance of new employees into organisations. It can take
some time to train fresh personnel in an organisation and while this training is
going on, it is possible for these rookies to make mistakes. So it can be surmised
that some of the poor risk management practices are attributable to inexperienced
personnel who are still learning. If so, a note of caution to organisations is not to
over task new or inexperienced employees hastily but to train them properly and
ensure they are fit for any assignment.

Given the flaws identified by the respondents, it is worth recommending that

organisations should improve on the way they manage the risk process. If need be,
a risk champion could be utilised for this purpose. Lapses should not be allowed to
manifest. Hopefully, many more organisations will work on improving their
practices. Project reviews should have a sub-section devoted to risk management.
That way, experiences gained and mistakes made are captured and the information
exploited in future projects to improve on risk management. A benchmarking
approach is worth recommending at this stage. Each year, an organisation should
evaluate its performance in terms of risk management and aim to improve on it the
following year. By doing so, their efficiency in this process will keep growing while
flaws are minimised.

6. References

Baker, S.; Ponniah, D. and Smith, S. (1999) Risk response techniques employed
currently for major projects. Construction Management and Economics, 17(2),
205-213.
Bernstein, P.L. (1996) The new religion of risk management. Harvard Business
Review, 74(2), 47-51.
Boothroyd, C. and Emmett, J. (1996) Risk Management – A practical guide for
construction professionals. Witherby & Co Ltd, London
Burchett, J.F.; Rao Tummala, V.M. and Leung, H.M. (1999) A world-wide survey of
current practices in the management of risks within electrical supply projects.
Construction Management and Economics, 17(1), 77-90.
CIPFA (1986) Risk Analysis. CIPFA-Audit Occasional Paper Number 4.
Edwards, P.J. and Bowen, P.A. (1998) Risk and Risk Management in Construction:
A review and future directions for research. Engineering, Construction and
Architectural Management, 5(4), 339-349.
Institute of Risk Management (IRM) (2002) A Risk Management Standard. AIRMIC,
ALARM, IRM: London. [Available online at
http://www.theirm.org/publications/documents/Risk_Management_Standard_0
30820.pdf] Accessed on 12 July 2009.
Institution of Civil Engineers and the Faculty and Institute of Actuaries (1998) Risk
Analysis and Management for Projects (RAMP), Thomas Telford, London.

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Kangari, R. (1995) Risk Management Perceptions and Trends of U.S. Construction.

Journal of Construction Engineering and Management, 121(4),422-429.
Latham, M. (1994) Constructing the Team. Final report of the Government /
Industry review of procurement and contractual arrangements in the UK
construction industry.
Pouliquen, L.Y. (1970) Risk Analysis in Project Management. International Bank for
Reconstruction and Development – World Bank Staff Occasional Paper Number
11.
Private Finance Panel (1995) Private Opportunity, Public Benefit: Progressing the
private finance initiative. HMSO, London.
Private Finance Panel (1996) Risk and Reward in PFI Contracts: Practical guidance
on the sharing of risk and structuring of PFI contracts. HMSO, London.
Project Management Institute (PMI) (2009) A Guide to the Project Management
Body of Knowledge: Practice Standard for Project Risk Management. Newtown
Square: Project Management Institute.
Raftery, J. (1994) Risk Analysis in Project Management. E&FN Spon, London.
Ranasinghe, M. (1998) Risk Management in the Insurance Industry: Insights for the
engineering construction industry. Construction Management and Economics,
16(1), 31-39.
Simon, P.; Hillson, D.; and Newland, K. (1997) Project Risk Analysis and
Management (PRAM) Guide, Association for Project Management, Ascot-UK.
Smith, N.J.; Merna, T. and Jobling, P. (2006) Managing risk in construction
projects. Blackwell: Oxford.

Abbreviations
CIPFA Chartered Institute of Public Finance and Accountancy
FIA Faculty and Institute of Actuaries
ICE The Institution of Civil Engineers

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AA015
A Research Framework for Developing a Performance Evaluation
Model for Target Cost Contracts in Construction

Daniel W.M. Chan

(Assistant Professor, Department of Building and Real Estate,
The Hong Kong Polytechnic University, Hong Kong)

Albert P.C. Chan

(Professor and Associate Head, Department of Building and Real Estate,
The Hong Kong Polytechnic University, Hong Kong)

Patrick T.I. Lam

(Associate Professor, Department of Building and Real Estate,
The Hong Kong Polytechnic University, Hong Kong)

John F.Y. Yeung

(Postdoctoral Fellow, Department of Building and Real Estate,
The Hong Kong Polytechnic University, Hong Kong)

Joseph H.L. Chan

(Research Associate, Department of Building and Real Estate,
The Hong Kong Polytechnic University, Hong Kong)

Abstract
The aims of this research study are to establish an Overall Performance Index (OPI)
and to develop a performance evaluation model for projects with Target Cost
Contracts (TCC) in Hong Kong. Four rounds of Delphi questionnaire survey will be
launched to identify the Key Performance Index (KPIs) for TCC projects and
investigate their corresponding weightings. A composite OPI will then be complied
for evaluating the performance level of TCC construction projects. Quantitative
Indicators (QI) and Fuzzy Quantitative Ranges (QRs) pertinent to each KPI will be
determined to minimise the subjective interpretation and value judgment to
enhance the reliability and practicality of the model. The proposed model is
expected to be developed into an online computerised system to enable industrial
practitioners to measure, assess and compare the performance levels of their own
TCC projects for benchmarking purposes.

Keywords
Target cost contracts, Overall performance index, Performance evaluation model,
Construction industry, Hong Kong

1. Introduction

The Report of the Construction Industry Review Committee (CIRC) published by the
Hong Kong Special Administrative Region advocated that better project
performance can be achieved by the adoption of more innovative integrated
procurement strategies, e.g. Guaranteed Maximum Price (GMP) and Target Cost
Contracting (TCC) with a gain-share/ pain-share arrangement (CIRC, 2001).

Client organisations have been increasingly observed to adopt the TCC approach to
their building and construction projects in Hong Kong over the past decade. With

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the perceived benefits of TCC, research into determining those Key Performance
Indicators (KPIs) which can be used to evaluate the overall success of TCC
construction projects becomes vital in order to help set up a benchmark model for
measuring the performance levels of these projects. However, few, if any,
comprehensive and systematic research studies have focused on developing a
comprehensive, objective, reliable and practical performance evaluation model for
TCC projects. There is an urgent need for systematic in-depth research to examine
the performance measures in delivering TCC projects.

The proposed research study aims to generate, for TCC projects, new knowledge
and clear understanding of these key factors of performance which can be
measured, and give the most appropriate profile of how well a TCC contract has
performed via the lessons and cases learned from Hong Kong. A secondary aim
based on this understanding is the production of a model for quantifying overall
performance of TCC construction projects. The model will be established based on
relevant literature review, in-depth interview, Delphi survey and fuzzy set theory.

2. Literature Review

a. Definitions of TCC and GMP

The National Economic Development Office (NEDO) (1982) based in the United
Kingdom considered that “target cost contracts specify a ‘best’ estimate of the cost
of the works to be carried out. During the course of the works, the initial target cost
will be adjusted by agreement between the client or his nominated representative
and the contractor to allow for any changes to the original specifications”.
According to Trench (1991), target cost contracting scheme is a contractual
arrangement under which the actual cost of completing the work is evaluated and
compared with an estimate or a target cost of the works, the differences within a
cost band are shared between the client and the contractor based on a pre-
determined ratio. Wong (2006) took a similar view that the contractor is paid the
actual cost for the work done during the contract stage. When the final construction
cost, termed the final total cost differed from the initial target cost, the difference
would be shared between the employer and the contractor based on a pre-
determined gain-share/pain-share ratio stated in the contract.

GMP is a type of contract works that is more suitable when the design is based on
conventional means. However, the scope of works is not clear for fixed price
bidding at the time of contract award (Saporita, 2006). The American Institute of
Architects (AIA) (2001) viewed GMP as a sum established in an agreement between
a client and a contractor as the cap of overall project cost to be paid by the client to
the contractor for performing specified works on the basis of cost of labour and
materials plus overhead and profit. The contractor receives a prescribed sum, along
with a share of any savings to the client under this procurement approach. If the
cost of the work exceeds the assured maximum, the contractor bears the excessive
costs (Walker et al. 2000). Under this situation, a ceiling price is established, and
the contractor is responsible for any additional cost (Gould and Joyce, 2003).
However, the project is often started with considerable unknowns, and the quality
and scope may be sacrificed at the expense of GMP (Gould, 2005).

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b. Recent Studies on TCC/GMP

Perry and Barnes (2000) proposed methods of tender evaluation of TCC and
suggested that the contractor’s share of cost overrun and saving should not be less
than 50%. Both Broome and Perry (2002) and Badenfelt (2008) explored how the
pain-share/gain-share ratio in TCC should be determined in the British and Swedish
perspectives respectively.

Boukendour and Bah (2001) analysed GMP with option pricing theory and
considered GMP as a hybrid system of cost reimbursement contract and optional
contract hedging the owner from over-budget and provide him possibility of cost
savings. Bower et al. (2002) examined three projects with different contractual
arrangements, including one with TCC, to illustrate the effective use of incentive
mechanisms. They concluded that contract incentive structures should provide
appropriate incentives to contractors to meet the targets of cost, schedule and
quality; correctly allocate risks and allow a suitable level of client’s involvement in
the projects.

Both Walker et al. (2002) and Hauck et al. (2004) investigated the case of the
Australian National Museum procured with TCC arrangement. Bubshait (2003)
conducted a questionnaire survey on incentive/disincentive contracting to the
clients and contractors of industrial projects in Saudi Arabia and his findings
supported the use of this kind of contract.

Wong (2006) introduced a computerized system for cost management in a cable

car project in Hong Kong. Chan et al (2007) reported on the findings of 8 structured
interviews in respect of the motives behind, perceived benefits, potential
difficulties, key risks, critical success factors of launching the TCC/GMP scheme and
the suitability of application. Furthermore, Chan et al. (2008) also evaluated the
effectiveness of partnering for an underground railway extension project with TCC
arrangement in Hong Kong via another research study. Kaplanogu and Arditi
(2009) explored the practice of pre-project peer reviews in construction companies
in the United States, suggesting that this kind of review was critical in reducing the
risks of a proposed project.

Interestingly, the literature survey indicated that there are several research studies
on the advantages and disadvantages, the operational mechanism, sharing ratio
and overall performance of TCC and GMP projects. However, few, if any, research
studies have been carried out on measuring the performance of these forms of
procurement. Therefore, this research study is an attempt to fill up the gap in this
area.

3. Proposed Research Framework

a. Overall research approach

The research process will consist of the following stages: (1) literature review; (2)
face-to-face structured interview; (3) Delphi questionnaire survey; (4) empirical
questionnaire survey; (5) data collection; (6) data analysis; and (7) validation of
the developed performance evaluation model. The two questionnaire surveys are
different in nature. The Delphi method will be used for collecting the data and
analysing the Delphi questionnaire survey in one case while the application of Fuzzy
Set Theory will be adopted for analysing the empirical questionnaire survey.

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However, both of surveys will be undertaken with the same group of relevant panel
experts in Hong Kong.

The target TCC/GMP projects construction projects in Hong Kong are listed as
follows:
1. Chater House (GMP) 2. 1063 King’s Road (GMP)
3. The Orchards (GMP) 4. York House (GMP)
5. Three Pacific Place (GMP) 6. One Island East (GMP)
7. Renovation of Mandarin Oriental 8. Yau Tong Estate Redevelopment
Hotel (GMP) Phase 4 (Modified GMP)
9. Tseung Kwan O Railway Extension 10. Tsim Sha Tsui Metro Station
Project (with five stations) (TCC) Modification Works (TCC)
11. Tung Chung Cable Car Project 12. West Island Line Railway Extension
(TCC) Project (with four stations) (TCC)
13. Improvement of Fuk Man Road
Nullah in Sai Kung (TCC)

b. Literature Review

This study will begin with an extensive review of recent literature on various
performance measures for construction in general as well as partnering projects in
particular from international scholar journals, internationally referred conferences
papers, textbooks, professional journals and the like. In fact, all the participating
client organizations introduced partnering concepts to their TCC/GMP projects as
partnering could help facilitate the implementation of the TCC/GMP philosophy. The
literature review aims to develop the overall research framework and to prepare an
appropriate template for the structured interviews and questionnaire surveys. The
performance measures used to evaluate the success of construction projects and
partnering projects in general will be used for determining the potential KPIs for
measuring the TCC/GMP projects in Hong Kong.

c. Delphi Surveys

Delphi technique is the primary research tool applied in this study in which a
consensus needs to be reached. The Delphi concept was developed by the defence
industry in the US. According to Robinson (1991), the Project Delphi was the name
of a study conducted by the Rand Corporation for the US Air Force in the early
1950s about the use of expert opinion. The Delphi method is a highly formalised
method of communication that is designed to extract the maximum amount of
unbiased information from a panel of experts (Chan et al 2001). It is generally
conducted in several rounds interspersed with group opinion and information
feedback in the form of relevant statistical data. Generally, the number of rounds
ranges from 2 to 7 and the number of participants varies between 3 and 15 (Rowe
and Wright 1999). The desired outcome is that, by using an iterative forecasting
procedure, on reaching the final round, the experts will have achieved unanimity on
the issues put before them (Manoliadis et al 2006). Therefore, the Delphi method is
appropriate for obtaining a series of the most important KPIs for evaluating the
success of TCC projects in construction.

Four rounds of Delphi surveys will be conducted to select the most important KPIs
for measuring the project performance of TCC/GMP projects. Industrial practitioners
with extensive hands-on experience working experience on TCC/GMP projects or

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prominent academics with research experience in TCC/GMP will be selected as the

panel of experts and invited to participate in the Delphi surveys. The iterations of
the Delphi exercise enable the panel to select a series of the most important KPIs
and then to provide suitable ratings to each of them for the TCC projects in Hong
Kong. Table 1 serves as a summary of the four rounds of Delphi surveys.

Table 1: Summary of four rounds of proposed Delphi survey

Round 1 Expert panel to select a minimum of 5 to a maximum of 10 KPIs from a
summary list of KPIs identified from literature
Round 2 Respondents will be provided a consolidated list of results from Round 1 and
requested to re-consider their options
Round 3 Respondents to provide ratings on the most important KPIs identified (the
most important KPIs for further consideration had to have been selected by
at least 50% of experts as advocated by Chan et al 2001) based on a 5-point
Likert scale (say 1 = least important and 5 = most important)
Round 4 Similar to Round 4, respondents will be given a consolidated list of results
from Round 3 and requested to re-consider their options

After deriving a series of the most important KPIs, it is necessary to compile a

composite Performance Index (PI) for use in evaluating the overall success of a TCC
construction project. The PI will be developed based on the mean ratings advocated
by the Delphi group of panel experts obtained in the fourth round of the Delphi
survey. The PI presented in the form of an equation will be composed of the most
important KPIs identified in Round 3, and the coefficients will be their individual
weightings, which will be calculated as their individual mean ratings divided by the
total mean ratings of all the most important KPIs identified (Yeung et al. 2007). In
addition, principal components analysis (PCA) will also be applied to develop the
composite Performance Index (PI) as adopted by Chan and Chan (2004) and Lam
et al (2005). Thus a composite Performance Index (PI) for measuring the overall
performance levels of TCC projects will be established. By doing so, different TCC
projects can be assessed and compared objectively based on the composite PI on
the same basis for benchmarking and monitoring purposes.

Despite the development of the composite PI, it is likely that different assessors
may have their own semantic interpretation on each KPI identified. In order to
eradicate any possible discrepancies in interpreting the meaning of each of the
selected most important KPIs, a set of Quantitative Indicators (QIs) appropriate for
measuring each of these KPIs will be proposed or established via five structured
face-to-face interviews with leading industrial practitioners with rich hands-on
experience in procuring TCC projects in Hong Kong. After that, 2 rounds of the
second Delphi questionnaire survey with the same group of panel experts as with
the previous four rounds of the first Delphi survey will be launched to objectively
assess the appropriateness of the proposed QIs by rating them against their levels
of importance, measurability and obtainability based on 5-point Likert scales where
1 = very unimportant / very difficult to measure or obtain and 5 = very important /
very easy to measure or obtain. The QIs identified with the highest mean ratings
for each of the selected most important KPIs will be adopted to be the most
suitable measures for the performance of TCC projects in Hong Kong. By doing so,
a list of QIs pertinent to the identified KPIs for TCC projects will have been derived.
By incorporating various QIs into the performance evaluation model, different
assessors could perform their evaluation process based on quantitative evidences.

Although a set of QIs established can provide a mutually agreed set of linguistic
interpretation and lead to more objective performance evaluation for TCC projects,
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it cannot fully eliminate the subjectivity of performance evaluation as different

assessors may perceive the same performance level with different numerical
measures. For example, should a TCC project be classified as ‘good’ or ‘very good’
in terms of cost performance in case of 2.5% reduction in project cost? In order to
remedy this inherent deficiency, this research study will further apply a Fuzzy Set
Theory approach (FST) (Baloi and Price 2003) through conducting an empirical
questionnaire survey with the same group of panel experts in Hong Kong to capture
their professional expectations or perceptions on the possible ranges of various
performance levels for each QI identified. Fuzzy sets are typically able to represent
linguistic terms, for instance, what is good or bad, hot or cold, fast or slow, etc.
Therefore, FST will be applied to define reasonable quantitative ranges (QRs) for
each QI measured at five different performance levels, namely, ‘poor’, ‘average’,
‘good’, ‘very good’, and ‘excellent’ by using the MATLAB 12.0 software package as
adopted by Ng et al 2002. By adding these quantitative indicators and quantitative
ranges to the evaluation process, assessors can determine which performance
levels should be assigned in accordance with the actual project performance rather
than applying their own subjective value judgment.

d. An online computerised system for compiling the overall PI and

other various key performance measures

An online computerised system for compiling the overall PI and other various key
performance measures (e.g. time performance or cost performance) of TCC
projects will be developed using some common software programs/languages (e.g.
PHP, HTML and Javascript) for industrial practitioners to benchmark and monitor
their own projects in Hong Kong. Project team members can just input their
necessary individual project information and data. The computerised system can
then directly provide a value of the composite overall PI to compare the levels of
project performance with those of other counterparts to see where their TCC
projects stand in relative term. The following results will be displayed graphically by
the computerised system:

(1) Overall performance of a TCC project (i.e. overall PI score)

(2) Actual performance of individual KPIs for a TCC project (e.g. ahead of
schedule by 1% for time performance)
(3) Relative performance of a TCC project when compared with other similar
projects (e.g. classified as “very good” time performance)
(4) Benchmarking performance (e.g. standing at 85th percentile in the database
meaning that the project outperforms 85% of those projects contained in the
data set)

4. Validation of the proposed performance evaluation model

The validation of the developed performance evaluation model for TCC projects will
be undertaken by inviting a few of the expert interviewees to complete a validation
scoring sheet according to a five-point Likert scale (1 = poor, 3 = average and 5 =
excellent) in terms of degrees of appropriateness, objectivity, replicability,
practicality, reliability and overall suitability for application.

5. Significance of this research

Although TCC/GMP has been practiced in Hong Kong for a number of years, not all
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the projects procured with those procurement strategies are equally successful. It is
thus important to identify the important KPIs and establish an online computerised
system to compare the performance of TCC/GMP projects in Hong Kong for further
improving the performance of similar projects in the future.

6. Concluding Remarks

This paper describes the research framework to develop a composite performance

index to measure the performance of TCC projects in Hong Kong via a series of
Delphi surveys. The proposed model is expected to be developed into an online
computerised system to enable industrial practitioners to measure, assess and
compare the individual performance levels of their own TCC projects for
benchmarking purposes.

7. Acknowledgements

The authors wish to thank The Hong Kong Polytechnic University for providing
financial support to this proposed research study (Project Account Code: A-SA42).

8. References

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contracts”,Engineering, Construction and Architectural Management, 15(1), 54-
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Baloi, D. and Price, A.D.F. (2003), “Modelling global risk factors affecting
construction cost performance”, International Journal of Project
Management, 21(4), 261-269.
Boukendour, S. and Bah, R. (2001), “The guaranteed maximum price as call
option”, Construction Management and Economics, 19(6), 563-567.
Bower, D., Ashby, G., Gerald, K. and Smyk, M. (2002), “Incentive mechanism for
project success”, Journal of Management in Engineering, ASCE, 18(1), 37-43.
Broome, J. and Perry, J. (2002), “How practitioners set share fractions in target
cost contracts”, International Journal of Project Management, 20(1), 59-66.
Bubshait, A.A. (2003), “Incentive/disincentive contracts and its effects on industrial
projects”, International Journal of Project Management, 21(1), 63- 70.
Chan, A.P.C. and Chan, A.P.L. (2004), “Key performance indicators for measuring
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221.
Chan, A.P.C., Chan, D.W.M., Fan, L.C.N., Lam, P.T.I. and Yeung, J.F.Y. (2008),
“Achieving Partnering Success through an Incentive Agreement: Lessons
Learned from an Underground Railway Extension Project in Hong Kong”,Journal
of Management in Engineering, ASCE, 24(7), 128-137.
Chan, A.P.C., Yung, E.H.K., Lam, P.T.I., Tam, C.M. and Cheung, S.O. (2001),
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Chan, D.W.M., Chan, A.P.C., Lam, P.T.I., Lam, E.W.M. and Wong, J.M.W. (2007),
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in Hong Kong Construction Industry”, Journal of Financial Management of
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CIRC (2001), “Construct for Excellence” Report of the Construction Industry Review
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Hall.
Gould, E.F. and Joyce, N.E. (2003), “Construction Project Management” (2nd
Edition), Prentice Hall, Upper Saddle River, New Jersey.
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Kaplanogu, S.B. and Arditi, D. (2009), “Pre-project peer reviews in GMP/lump sum
contracts”, Engineering, Construction and Architectural Management, 16(2),
175-185.
Lam, E.W.M., Chan, A.P.C. and Chan, D.W.M. (2007), “Benchmarking the
Performance of Design-Build Projects: Development of Project Success Index”,
Benchmarking: An International Journal, 14(5), 624-638.
Manoliadis, O., Tsola, O. and Nakou, A. (2006), “Sustainable construction and
drivers of change in Greece: A Delphi study”, Construction Economics and
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Perry, J.G. and Barnes, M. (2000), “Target cost contracts: an analysis of the
interplay between fee, target, share and price”, Engineering, Construction and
Architectural Management, 7(2), 202-208.
Robinson, J.B.L. (1991), “Delphi technology for economic impact assessment”,
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Saporita, R. (2006), “Managing risks in design and construction projects”, ASME
Press, New York.
The American Institute of Architect (AIA) (2001), “The architect's handbook of
professional practice” (13th Edition), John Wiley, New York.
Trench, D. (1991), “On Target – A Design and Manage Target Cost Procurement
System” Thomas Telford, London.
Walker, D.H.T., Hampson, K. and Peters, R (2000), “Relationship-based
Procurement Strategies for the 21st Century. AusInfo, Canberra, Australia”,
112 pages, ISBN 064243079-9.
Walker, D.H.T., Hampson, K.D and Peters, R. (2002), “Project alliancing vs project
partnering: a case study of the Australian National Museum Project”, Supply
Chain Management, 7(2), 83-91.
Wong, A.K.D. (2006), “The application of a computerised financial control system
for the decision support of target cost contracts”, Journal of Information
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Yeung, J.F.Y., Chan, A.P.C., Chan, D.W.M. and Li, Leong-kwan (2007),
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AA104

Delivering the Design Services and Other Professional Services

Geoffrey S. Child
(Professional Engineer, Sunrise Engineering, Inc., Mesa, U.S.A.)

Kenneth Sullivan
(Assistant Professor, Arizona State University, Tempe, U.S.A.)

Dean Kashiwagi
(Professor, Arizona State University, Tempe, U.S.A.)

Abstract
Design Services have been not meeting the value and expectations of the clients
and their project managers. A research project has studied the impact of the low
bid award environment on construction practices, and has proposed that designers’
current practices and expectations are price based and not performance based.
The authors also propose that the qualification based system is a price based
system and should be replaced by a best value system which includes a best value
selection process such as the Performance Information Procurement System (PIPS.)
The new design model will give control and risk management capability back to
designers by utilizing a weekly risk report (WRR) and the risk management plan
(RMP.) The new PM model managing design firms will create transparency; will
give the advantage to the higher performing professionals. The researcher
interviewed over 400 designers to validate the concepts of the new designer model.

Keywords
Delivery of Design Services, Designer Risk Management

1. Introduction

There is a great deal of inefficiency throughout the A/E/C (Architectural,

Engineering and Construction) industry. Many believe the design professional to be
the major source of risk and inefficiency, ultimately leading to poor delivery of
construction services (Tucker (2003)). However, there may be multiple issues
causing poor performance throughout the design and construction industry (Rubin
(2005)). One of these issues may be the procurement system itself (Sullivan,
Kashiwagi, & Kashiwagi (2009)). Since the enactment of The Brooks Act (Public
Law 92-582 for Federal Procurement) in 1972, the majority of A/E design services,
for public projects, have been procured through QBS (Qualification Based
Selection). QBS is good in theory but not always the most efficient method and
could be better if it were moved into a Best Value environment. Best Value
procurement is a performance based environment, considering performance and
price (Kashiwagi (2010)). Qualifications is a minimum requirement that levels the
playing field and results in a price based environment. Performance accepts the
differential between entities, and allows the high performers to skew the playing
field in favour of the high performers. An efficient Best Value system considers
more performance based factors instead of qualifications, such as minimization of
risk, added value, and past performance measurement of the firm and its
individuals (Kashiwagi (2010)).
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2. Problem Statement

The delivery of design services through QBS (Qualification Based Selection) does
not always procure the most performing consulting design professionals. The
procurement process itself may be the cause of poor designer/professional
engineering performance (Sullivan, Kashiwagi, & Kashiwagi (2009)). As a result,
design professionals are not being held accountable for delivering designs that meet
the expectations (on time, on budget and minimized change orders) of the client
(Touran (2006); Tucker (2003)). Design performance has deteriorated, has not
met the expectations of the client/user, and has minimized the professionalism and
importance of designers (Egan (1998); FMI / CMAA (2004))

3. Hypothesis

Owners can improve design and construction performance by improving the

selection and delivery process of professional services. Design professionals (DP)
need to move to a best value environment to increase professionalism and
performance. The current environment for DPs is an inefficient, price based, and
relationship based environment.

4. Methodology

To validate the hypothesis the following steps will be performed:

1. Research literature to verify inefficiencies of existing conditions and how
those inefficiencies hamper the design professional’s performance.
2. Use deductive logic to demonstrate that design professionals currently work
in a price based environment and need to move into a best value
environment.
3. Validate the concepts by conducting a survey amongst A/E/C Professionals.

5. Confirming the Price Based Environment of Designers

In today’s construction industry, design, engineering, and construction entities have

become commodities, which are often misaligned. The selection of the lowest
responsible bidding contractor has increased the risk of the client/owner. Owners
try to protect themselves by employing legal representation. Facilitators,
mediators, arbitrators, judges, juries, special masters, and neutral advisors are also
often major players of a project. Indemnification provisions are longer than the
scope of services in service agreements. The party least prepared to control risk is
often contracted to do so (Berman (2003)).

Another major problem with today’s professional design environment is that it is

relationship based and not performance based. Architects and engineers are often
hired based on relationships. In 2007, SMPS conducted a survey where almost 60
percent of the respondents said that key client relationships are in jeopardy if a
particular staff member retires or leaves (Schriener (2007)). Relationships are so
important to owners and architects that current AIA contracts are set up to protect
and preserve relationships during disputes (Berman (2002)).

Another problem in today’s design-construction environment is that architectural,

engineering and contracting services are being treated as commodities. For
example, Maricopa County (Arizona) has considered changing its procurement

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code. The proposed amendment of the Maricopa County Procurement Code of

September 2009 would consolidate procurement functions into the Department of
Materials Management where commodities are purchased. J. Burnett (2009),
Executive Director of ACEC of Arizona, stated, “What this means is, if adopted,
‘procurement’ for engineers, architects and contractors would go through Materials
Management…” ACEC of Arizona is adamantly opposed to taking the procurement of
professional engineering services from the engineering experts and placing this
function in the hands of procurement officers who buy commodities.”

6. The Construction Industry Structure

The construction industry consists of project owners, contractors and design

professionals. The Construction Industry Structure (CIS) (Figure 1) (Kashiwagi
(2010)) segments any industry based on performance and competition.

Fig 1: Construction Industry Structure (Kashiwagi, 2010)

The price based environment includes the following characteristics (Kashiwagi,

2010):
1. Projects being awarded based on price, relationships, and the
designers/contractors being perceived as commodities.
2. The client’s representative directs and controls both design and construction.
3. There is no transfer of control and accountability to the vendors.
4. Designers use minimum standards to identify requirements.
5. The minimum standards are turned to maximums by the vendors due to the
price based environment and driven downward by vendors (Figure 2).
6. Contractors who are short on experience and only do what they are directed
to do become more competitive because they can give a lower price.
7. Contractors who manage and minimize risk and who are the better value
when considering total project cost, become less competitive (Figure 3).

Fig 2: Min/Max Dilemma Fig 3: Price-Based Award

(Kashiwagi, 2010) (Kashiwagi, 2010)

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In the best value environment, risk is transferred to the best value, which is usually
the high performance vendor (designer and contractor). In the Best Value or value
based environment, designers and contractors must do the following to be awarded
work (Kashiwagi (2010)):
1. Compete based on past performance of the company and key individuals.
2. Quantify the technical risk/scope of work and the risk that they do not
control (not in the scope of the project) and have a plan to manage and
minimize the risk.
3. Key personnel must be interviewed to identify if they can be proactive and
accountable, minimize the risk that they do not control, pre-plan, and to
identify if they have the expertise to manage the project.
4. Price is determined by the professional/vendor, and it must be competitive.
The low price proposer will be awarded the project, if the value of the
different proposers cannot be identified.

The difference between the two environments is that the price based environment
has the following negative and unstable characteristics (Kashiwagi (2010)):
1. No transfer of risk and accountability.
2. Non-expert directing the expert.
3. Increased confusion, and higher flow of communication and documentation.
4. Requires more individuals to make more decisions.
5. Allows less qualified personnel to do the work due to the lack of
accountability.
6. Participants are reactive.
7. Requires increased management.

The price based environment is setup and controlled by the owner/client.

Deductive logic shows that the solution might be in changing the system from a
price based system to a best value environment. The participant who can
implement system change most efficiently is the owner/client because they have
set up and control the current delivery system (Beemer, et al. (n.d.)).

7. PIPS (Performance Information Procurement System

An example of an efficient BV system is PIPS (Performance Information

Procurement System). “PIPS is an information based procurement system that
uses Best Value selection and a performance contracting approach. It minimizes
the liability and risk of the designer and owner, maximizes the profit of the
contractor, uses partnering as a perception but not a function, and transfers the
risk to the contractor. It motivates contractors to improve on every project and do
their own quality control. PIPS has a methodology to find the best available value
and motivate the contractor to assign the best performers to the project. PIPS
uses performance information to select the Best Value contractor, and then uses
the rating on the Best Value on the project to alter the contractor’s future
competitiveness and performance (Kashiwagi (2002)).” PIPS is a project
management (PM) model, a risk management (RM) model, a selection process, a
procurement delivery process and a Best Value structure. PIPS uses all of the Best
Value practices. PIPS can be run with DBB, DB, CM@Risk, CM, IDIQ, JOC,
Performance Contracting, and Best Value contracting. PIPS is a Best Value model
that aligns expertise and resources; minimizes transactions; minimizes transaction
time and cost; minimizes information flow, decision making, and risk. PIPS can be
run in either the price based environment or the Best Value environment. It can be
used for the delivery of any service in any industry. Information on PIPS is
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available at www.pbsrg.com. ASU researchers developed the PIPS for contractor

selection. The system has been tested on over $800M of construction projects with
a variety of owners. “ASU reports 98 percent on-time delivery, no change orders
and an 80 percent reduction in management functions” (Angelo (2006)).

8. A/E/C Industry Survey

In October of 2009, an online (internet based) survey was prepared and invitations
were sent via email to over 1,200 professionals (architects, engineers and
contractors) with 449 responses received. The survey was sent out using the
survey hosting website www.survkeymonkey.com. The survey was sent, by the
author, with the objective to identify issues and concepts within the price based
marketplace as well as the best value marketplace. The majority of the survey
recipients/participants were design professionals from the Arizona marketplace.
Responses were received from professionals working for municipalities, engineering
consulting firms, architectural consulting firms, contractors, utility providers, etc.
The majority of the respondents came from municipalities and consulting firms,
representing two distinct sides from within the design-construction market.
Municipalities represent the public owner/client while the consulting firms represent
the supply side of the industry. There are over 40,000 Licensed Professional
Engineers, 28,000 Licensed Professional Architects, and 50,000 licensed contractors
in the state of Arizona (Arizona Board of Technical Registration (2009); Arizona
Registrar of Contractors (2009)). From a statistical standpoint the A/E/C population
size is considerably large. This equates to a greater than 95 percent confidence
level with a plus or minus of five percent (± 5%) margin of error, using commonly
accepted statistical analysis standards.

The survey consisted of some identifying questions to determine such things as the
respondents’ organization type, title, and whether or not they are a licensed
engineer or licensed architect. The next section of the survey then asked the
respondents to rate 18 statements on a scale of 1-10 (1 Strongly Disagree, 3
Disagree, 5 Don’t Know, 7 Agree, 10 Strongly Agree). The first 12 statements were
related to verify the existence of Quadrant I and the last six statements were
related to relative understanding of Quadrant II of the Construction Industry
Structure (Figure 1). The survey respondent’s organization type had a nearly even
split between the public and supply side of the marketplace. Private consulting
services comprised 45% of the survey respondents (Engineering 28% and
Architectural 17%). The public owners/clients response made up 41% of the
survey. The remaining 14% of the survey respondents included contractors,
developers, private utility owners and others. The results of the survey were
analyzed in three distinct groups. The first group was the “All A/E/C Respondents”
group, consisting of all the respondents. The second group was the “Private
Consulting A/E” group. The third group was the “Public Owner/Client” group.

9. Survey Results

Overall the survey results lean heavily towards agreement of the identified issues
within the price based environment and important concepts of the best value
environment. The most frequent rating throughout the entire survey was seven
(7). It was chosen 1,457 times. The next highest was eight (8) at 1,317 times.
This was followed by nine (9) and ten (10) at 1,017 and 1,011 respectively. After
this, five (5) was the next most selected at 825 times. Sixty percent of the time
“Agree” (7-10) was chosen, 26 percent of the time “Don’t Know” (4-6) was chosen
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and only 14% of the time “Disagree” (1-3) was chosen. The results of the survey
show that the majority of designers either agree with the previous discussion or
don’t know, with only 14% disagreeing.

There are a few obvious disagreements on some of the issues. Upon analyzing the
data it was determined that the major disagreements exist between the public
(client) and private sectors (design firms.) This demonstrates the confusion that
exists within the existing QBS (Qualification Based System), and may be one of the
major factors contributing to a price based environment.) The industry agrees that
in the QBS (Qualification Based Selection) process, relationships with public
owners/clients are very important in order to get work. Seventy seven percent of
the industry agrees with Question 1 “Relationships are important for design firms to
get work from project owners in the existing QBS process”. Sixty five percent of
the industry agrees with Question 2 “The QBS system results in relationships being
very important”. The results of Questions 1 and 2 have an average rating of 7.60
and 7.01 respectively. However, when answering Question 3 “Design firms are
often hired based on relationships instead of capability and performance,” is in the
“Don’t Know” range (5.58.) The disagreement between the clients and design firms
can be easily seen in the histograms of Figure 4. Clients didn’t think relationships
mattered, but the design firms respondents were in direct conflict. Fifty seven
percent of the private A&E respondents agree with Question 3, 29% don’t know and
14% disagree. To the contrary, 45% of the public owners/clients disagree with
Question 3, 32% don’t know and only 23% agree.

Histogram Public vs Private Response of #3

Variable
3.Public
40 3.Private

30
Frequency

20

10

0
2 4 6 8 10
Data

Fig 4: Disagreement between Clients and Designers

In order to verify that there was a significance difference between the public and
private ratings (for Question 3) a T-test was performed, which verified that the
observation was accurate, showing that the probability of making the wrong
assumption was 1.52x10-15 percent. This level of error is far under the acceptable
5% at 0.01 percent (0.01%). Seventy six percent of the industry agrees with
Question 4 “The major objective of contractors and design consultants at a
conference is to network with owners/agencies and form relationships”. The
average rating was 7.35. The results are further demonstration of the importance
of relationships in the existing QBS, price based, and commodity based market.

Question 5 “Differentiation between qualified firms can be difficult using QBS” only
had an average rating of 5.71 throughout the industry. However, 43% of the
responses fall in the “Agree” group, 31% in the “Don’t Know” group, and 26% in
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the “Disagree” group. The results of this section support the notion that it is
difficult to clearly differentiate one qualified firm from another in the QBS process.
The overall response to Question 7 “Construction and design services are often
perceived as commodities by owners” was interesting. The average rating was
6.51, which is right in between “Don’t Know” and “Agree”. Looking at the
responses even further, yields some more interesting information. Sixty five
percent of the private A&E side agree with Question 7 by giving it an average rating
of 7.11. However, only 40% of the public owners/clients agree and 44% don’t
know, giving them an average rating of 5.8. Much like Question 3, the difference
on commodity perception between private and public supports the theory that the
existing QBS, price based, commodity based environment is an inefficient and
confusing market where private and public disagree.

Eighty percent of the industry agrees with Question 13 “Measuring the performance
of the design firm and their key individuals on a project would increase their
accountability and performance”. The average rating was 7.43. The majority of
the industry agrees with Question 14 “Designers should manage risk and deviation
on the project”. Sixty three percent of all responses fell within the “Agree” range,
28% within “Don’t Know” and only 9 percent within the “Disagree” range.

Seventy one percent of the industry “Agree” with the concepts of Question 15 “On
design related issues, project owners should rely on the expertise of the design
professional to identify the best course of action.” The average rating was 7.2, and
only seven percent disagree. Designers also agreed that designers cannot scope
and cost projects, and require the assistance of high performance contractors.
Question 16, “Designers should seek the assistance of experienced contractors to
provide accurate cost estimates and scope of projects”, received the second highest
rating of all the questions with an 8.04 and 87% of the industry agreed with the
Best Value concept. Designers agreed that owners still control the level of
performance and quality of design and construction with a 6.23 with 53% rating it
within the “Agree” range. These results seem to provide more support to the fact
that the current design-construction industry is working in Quadrant I of the CIS
and that the industry doesn’t know who controls performance and quality on a
project. However, designers all agreed in Question 18 “Qualifications, competitive
price, minimization of risk, added value, and past performance of the firm and its
individuals are all important factors an owner should consider when
selecting/procuring a design firm”, was the highest rated question in the entire
survey. This question contains the majority of the characteristics and attributes of
an efficient Best Value delivery system. Eighty nine percent of the industry agrees
with its concepts. The average rating was 8.4, and only six percent disagree.

10. Conclusions and Recommendations

The current delivery of construction environment is in the price based environment.

The survey of designers representing both the clients/owners and the design firms
validates these concepts. The current QBS selection process, which is touted as a
professional value based approach is actually perceived as a price and relationship
based practice. The hypothesis of moving to a best value approach where the risk
and control of projects is shifted to designers is validated by the designers. Project
managers who represent clients should select designers by performance and value,
transfer the risk and control of design to the design firm and their designers and
measure their performance. Survey results suggest that the A/E/C industry is
strongly in favour of moving design professionals into a best value environment.
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The authors also suggest that the Performance Information Procurement System
(PIPS) can be used as a mechanism to move the design environment.

11. References

Angelo, W. (2006, April 3), "Best Value: University’s System Boosts Value Added",
Retrieved December 12, 2009, from Engineering News Record Web Site:
http://enr.ecnext.com/coms2/article_febiar060403d
Arizona Board of Technical Registration Professional Registrants Listing. (2009),
Retrieved November 2009, from Arizona Board of Technical Registration Web
Site: http://www.azbtr.gov/
Arizona Registrar of Contractors License Search. (2009), Retrieved November 2009,
from Arizona Registrar of Contractors Web Site: http://www.azroc.gov/
Beemer, J., Fogle, R., Kopplin, C., Porterfield, T., Sauter, G., Wieczorek, N., et al.
(n.d.), "The Cost of Perfection - A Design Professional's Perspective", Retrieved
July 19, 2009, from Architects/Engineers Professional Network (ae ProNet):
http://www.aepronet.org/pn/vol17-no1.html
Berman, G. (2003), "Are Foxes Watching the Owner's Hen House? - An Examination
of the Architect’s and Construction Manager’s Roles in Managing and
Administering the Design and Construction Process", CM eJournal . Construction
Management Association of America.
Berman, G. (2002), "The Morphing of the Architect’s Role and How it is Impacting
the CM", National Conference and Trade Show (pp. 3-17, 28-29). San Diego:
Construction Management Association of America.
Burnett, J. (2009, September 11), "Re: ACEC of Arizona Request for Action",
[Electronic mailing list message]. American Council Of Engineering Companies
of Arizona.
Egan, S.J. (1998), Rethinking Construction: The Report of the Construction Task
Force to the Deputy Prime Minister, John Prescott, on the scope for improving
the quality and efficiency of UK construction. The Department of Trade and
Industry.
Erdmann, R. (2002). The Relationship between the Design-Bid-Build (DBB) System.
Tempe: Arizona State University. Master Thesis.
FMI / CMAA Fifth Annual Survey of Owners (2004). Management Consulting -
Investment Banking for the Construction Industry. Retrieved September 27,
2006 from http://cmaanet.org/user_images/fmi_owners_survey2004.pdf
Kashiwagi, D. (2010) “Best Value PIPS/PIRMS,” Performance Based Studies
Research Group, Kashiwagi Solution Model Inc., Mesa, AZ.
Rubin, D. K. (2005, November 28), "Execs Believe Managing Risk Is Their Biggest
Challenge", Retrieved December 1, 2009, from Engineering News Record Web
Site: http://enr.ecnext.com/coms2/article_nefiar051128h
Sullivan, K., Kashiwagi, J., & Kashiwagi, D. (2009), "The Optimizing of Design
Delivery Services for Facility Owners", Tempe: Performance Based Studies
Research Group (PBSRG), School of Sustainable Engineering and the Built
Environment, Arizona State University.
Touran, A. (2006, October), "Owners Risk Reduction Techniques Using a CM", CM
eJournal . Department of Civil & Environmental Engineering, Northeastern
University.
Tucker, W. W. (2003, October 30), "Construction Productivity Study Executive
Summary", Retrieved September 2, 2009, from Michigan Tri-partite Committee
Web Site: http://www.mitripartite.com/ExecutiveSummaryl.pdfMangasarian,
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AA038

Does the use of partnering lead to improved project performance?

Pauline Corbett
(Principal Lecturer, University of Wolverhampton, Wolverhampton, UK)

Jonathan Wright
(Quantity Surveyor, Carillion PLC, Wolverhampton, UK)

Abstract
The objective for this study is to ascertain whether the adoption of partnering and
other construction best practice principles lead to improvements in the project
outcomes and deliverables on UK construction projects where financing is from
public funds.

A series of pilot interviews are carried out with client, main and subcontractor
representatives to address this question.

The main findings from the pilot research are that the use of partnering is seen as
having a positive impact on projects in terms of time, cost and end quality, albeit
not to the levels expected. The use of partnering also leads to the project team
embracing other best practice tools. However results indicate one barrier to
partnering realising its full potential is the lack of trust within in the construction
industry and this stops the sector fully committing to more open project
relationships as best practice principles envisage.

Keywords
Partnering, improved performance, best practice.

1. Introduction

In the mid 1990’s the United Kingdom (UK) construction industry was seen as
failing to deliver construction projects on time and to budget, with only around 25%
of projects being delivered within budget and 34% of projects delivered on time,
(OGC, 2009). With the industry being important to the country’s economy,
contributing almost 20% of GDP (Constructing Excellence, 2009a), this gross
inefficiency could not be tolerated.

Latham, 1994 and Egan, 1998 identified wider failings within the construction
industry such as poor management, focus on low cost rather than value for money,
the presence of short term relationships, a lack of integration and a generally risk
averse culture. Latham, 1994 noted little or no consideration was given to how
realistic the received bids were or to the quality of the end product and the
satisfaction of the end user. This resulted in firms tendering for projects at a loss,
with a view to clawing back enough money to turn a profit through the claims
process. Greaves et al, 1998 associated these failings with procurement strategies
being selected for projects which were not appropriate for the features of the
projects for which they were being selected. In addition to this there was no
presence of any form of industry benchmarking, or any structured recording of

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results to assess whether indeed the company or project had performed well
(McCabe, 2001) and how future improvements could be made.

Possible solutions were advocated (Murray et al, 2003; Leading Edge, 2008), with
the result that the UK government would lead the industry as a best practice client,
and by example, would develop, implement and use a set of construction best
practice principles that the whole industry would be able to adopt to enable it to
improve its performance.

Best practice is a term used for the method of finding and using the best ways to
achieve business objectives through continually learning from past experiences and
seeking to improve upon them, and is a set of practices which are now widely
accepted and used within the UK construction industry. The best practice themes as
identified by Constructing Excellence, 2009a are grouped under three main banners
namely, Business Processes, Internal Cultures and External Relations.

Business Processes looks at a company’s business processes and practices with a

view to improving overall performance. Benchmarking typifies the process by
measuring own company performance against other similar companies
(Constructing Excellence, 2009b), and identifying where improvements can be
made by asking the questions, who does it better, how do they do it better? Then
adapting / adopting the better practices in order to improve performance (Ashworth
& Hogg, 2000), thus achieving continuous improvement (McGeorge & Palmer,
1997). Organisations must be responsive to change if they are to survive (McCabe,
2001) and it is through effective benchmarking that they are able to quickly identify
successful or under-performing areas of their business operations and highlight the
areas requiring improvement or change (McGeorge & Palmer, 1997). Other
business processes recommended for adoption included the greater use of IT and
knowledge management systems on projects, the use of lean construction
principles, increased standardisation and pre-assembly of components, and
management tools such as risk and value management and whole life costing.

A best practice Internal Culture focus promotes a company to be open, honest and
respectful in order to facilitate the successful delivery of projects by the quality of
its contract participants (Constructing Excellence, 2009b) via improved leadership,
motivation, team working, training and valuing of the workforce. This focus,
through the use of key performance indicators (KPI’s) and benchmarking, would
continuously measure progress and identify improvements from previous
performances.

External Relations are to be in place to handle the issues of understanding what the
client wants and having effective relationships with all parties to a contract or
project extending beyond the client into the supply chain, key stakeholders and the
wider community, ensuring that the business is run in a responsible and socially
conscious way (Constructing Excellence, 2009b). The one key development being
the recommended adoption on projects of partnering as the procurement route
used to consolidate these external relations.

The concept of partnering originated from the successful use and performance in
the manufacturing industries of the Far East and was introduced to the British
construction industry, in a limited way, in the late 1980’s / early 1990’s, after being
used in the construction industries of America and Australia around this time.

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Mosey, 2009 sees partnering an approach to undertake construction business

objectives in a collaborative manner, which aims to move away from the features of
traditional procurement and their relationships which were seen to be the root
cause of the industry’s failings of cost overruns, late delivery and perceived poor
quality of the final product towards a culture where trust, openness and continuous
improvement were the norm and where performance is measured, monitored and
improved.

It is a construction practice which is said to be most effective over a number of

projects in the form of ‘strategic’ partnering’, but has been shown in a number of
examples to be effective in improving areas of time and cost for projects over both
the short and long term (OGC, 2005; Local Government Task Force, 2005),
although it is said that not all examples are likely to demonstrate these kinds of
predicted improvements (Akintoye & Main, 2007).

Whilst some authors such as Bennet & Jayes, 1995; Rowlinson and Mcdermot,
1999; Holt, 2000 and Egan, 2002 take the view that partnering sits at the heart of
best practices which aim to bring about positive change by enabling other practices
such as constantly measuring, assessing and improving upon performance. Others
such as Bresnen & Marshal, 2000 have the opinion that not all collaborative
partnerships in construction will necessarily be as successful as the examples
highlighted by the Office of Government Commerce (OGC, 2007).

It was hoped that the use of partnering on construction projects would yield
significant improvements, with the potential to reduce project costs by 30% and
time by 40%, whilst giving greater certainty on all issues and a potential for zero
defects (CIOB, 2006).

Thus the identified best practice theme of partnering procurement is highlighted as

a means by which the required improvements of construction project performance
can be made, as it encompasses a theme of continuous improvement through key
performance indicators and collaborative contractual relationships which encourage
long term commitments that are able, in theory, to put in place an operational
framework in which many best practice areas can be implemented and the resultant
benefits gained.

2. Research

The objective for this pilot study is to observe whether the adoption of construction
best practice principles would lead to improvements in the project outcomes and
deliverables on UK construction projects where the key source of financing was
from public funds.

Interviews were carried out among a small sample of construction professionals.

The identification of likely participants for the pilot study was then considered. The
primary factor for eligibility for participation was initially to identify and select a
range of construction professionals employed on a high profile government funded
projects. The professionals would be chosen from all parts of the project chain in
order to acquire different perspectives on the interview subject matter and to
ensure that the results are not biased towards a single perspective.

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The interviewees have been approached from sub-contractor, main contractor &
client backgrounds. A total of 5 interviews were conducted with the interviewees,
who were chosen from a key centrally funded project, namely The Birmingham
Construction Partnership (BCP). This partnership operates within the UK’s second
largest city and delivers the city’s £500 million capital building programme. The
BCP has been hailed by the Office of Government Commerce (OGC) and the Local
Government Task Force (LGTF) as an exemplar project in the government sector.
The BCP has moved away from lowest price tendering and instead operates via a
collaboration of contractors, designers, and specialist supply chains that are tasked
with delivering every project in the city with a value of over £100,000.

The pilot study comprised interviews which followed a schedule with a set of
predetermined open ended questions, seventeen in total, grouped into three main
areas. The first part defined the respondents’ job description within the
construction industry and the duration of their experience in the industry and their
general impressions of the industry during their careers. The second part of the
interview concerned the area of best practice. The final area of questions was
designed to establish the respondents’ opinions as to the key best practice area
which would lead to improved project performance.

Research results

General details
A total of 5 interviews were conducted with the following details:

Role in Participant Profile Number of years

Partnership construction
experience
Client An operations and compliance manager 23 years
currently working for the client in a Local
Education Partnership
Main PM1, A project manager with an 12 years
Contractor international building and civil engineering
company.

QS2, A project quantity surveyor with the 12 years

same international building and civil
engineering company.
Sub- CM1, A Contracts Manager for a large 23 years
Contractor ground works sub-contractor.

QS1, A Quantity Surveyor for a large 14 years

structural steel sub-contractor.
Table 1 – Participant details

Best practice awareness

This section asked the respondents specifically about their awareness of best
practice principles; their understanding of the term and whether the adoption of
such an approach would lead to project efficiency gains (see Table 2 – Answers to
Best Practice questions).

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Best
Are you aware of the What is your definition of 'best
Practice
term ‘best practice’? practice'?
Question
An efficient process giving value for
Client Yes
money to meet or exceed expectations
Main
Exceeding traditional expectations for
Contractor Vaguely
time, cost, quality and safety.
(PM1)
Main
The best way of doing something in a
Contractor No
fair and reasonable way.
(QS2)
Sub Best practices are going that extra mile
Contractor No and using your own knowledge and
(CM1) experience
Sub
Achieving high standards, profitability
Contractor Yes
and knowing everyone’s needs.
(QS1)
Table 2 – Answers to Best Practice Questions

Key best practice area

The interviewees were then asked to identify from a list of best practice themes i.e.
business process, internal culture and external relations, the themes applicable to
the BCP project. (See Table 3 – Best Practice areas used).

Best In your experience do partnered projects have a better

Practice uptake of the best practice principles, and if so which are
Question most common?
Definitely. The most common would probable be health
Client and safety and sustainability, but that’s the same with all
projects these days.
Main Yes, Benchmarking, risk & value management and also
Contractor improved briefings and better client focus are all more
(PM1) commonly present on partnered projects.
Yes, these things are driven by the requirements of the
Main
client so features such as benchmarking, improving
Contractor
relationships with supply chain and training being ongoing
(QS2)
are more prevalent.
In my experience within a major contractor I would say
Sub
no as these things that you have described are in place
Contractor
within the policy of the company on most projects
(CM1)
anyway.
Yes definitely. My background is with a Japanese company
where these things are common place and you do see a
Sub
lot of them such as Lean construction, standardisation
Contractor
and pre-assembly, continuous improvement, supply chain
(QS1)
management and the focus on teams and business
processes.
Table 3 – Best Practice areas used

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Key best practice improvements

The interviewees were then asked whether, and to what extent, had the use of best
practice principles improved project performance (see Table 4 – Improved project
performance when using Best Practice principles).

From your experiences would

you say that the reported
Would you say that best
benefits of partnered projects
Best practice has had a positive
such as 30% to 50%
Practice impact on projects in terms
improvements in time and cost
Question of time, cost and end
when compared to non
quality?
partnered projects are the
'norm'?
Unsure, but it sounds high.
Wouldn't everyone be using it if
Client Yes definitely
those were the savings all of
the time!?
Main
I would say they are cherry
Contractor Yes massively
picked. Those levels seem high!
(PM1)
I'm afraid I'd say cherry picked
Main as they do or can bring about
Contractor Yes improvements but much
(QS2) smaller increments than 30% to
50%.
Yes. Having a greater
involvement with the
Sub In my opinion I would say that
contractor means knowledge
Contractor those results are cherry picked
is widespread and that
(CM1) yes.
enables forward planning
giving better project results.
Definitely cherry picked. Those
results are there but they are
Sub Yes, in terms of quality and not the norm. That type of
Contractor cost. Maybe not time performance is only available
(QS1) though. when everyone is willing to take
the risk and when the principles
are embraced across the board.
Table 4 – Improved project performance when using Best Practice principles

Best practice barriers

This section asked the respondents about the main obstacles to partnering realising
its full potential and being fully embraced by the industry (see Table 5 – Best
practice barriers).

What in your opinion are the main obstacles to

Best Practice Question partnering realising its full potential and being
fully embraced by the industry?
Old habits towards relationships being hard to
Client
break.
Peoples personalities and the culture within the
Main Contractor (PM1)
industry.
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People are nervous of entering into these

Main Contractor (QS2) arrangements because of past experiences and
attitudes towards trust.
Inherent distrust that exists within the industry at
operational levels, i.e. site management. Plus the
Sub Contractor (CM1)
economic climate as it is which is probably the
biggest barrier at present.

Sub Contractor (QS1) Trust.

Table 5 – Answers to Best Practice Questions

Conclusions and further work

Whilst the research may be limited by the small numbers of respondents

representing the various parties to construction projects, it clearly established that
best practice has no one clear definition. Best practice is seen as a process, or a
collection of working methods or just a different way of delivering projects. Those
construction projects that used the best practice partnering approach were seen to
have a greater uptake of other best practices such as benchmarking, teamwork,
and supply chain management, which are all practices seen to contribute to the
success of a project.

Partnering was also seen to bring about improvements to projects when compared
to similar non partnered projects and it was unanimously viewed that best practices
principles did have a positive impact on projects in terms of time, cost and end
quality. However the reported benefits of partnered projects such as 30% to 50%
improvements in time and cost when compared to non partnered projects were
rejected by the study. Reasons for this were indicated as those projects exhibiting
the levels of success that partnering promised to deliver are often carefully chosen
i.e. cherry picked. However smaller levels of improvement were identified, albeit
no respondent gave it a value.

The barriers to partnering realising its potential were identified as continued

participant behaviour issues, a lack of trust in the industry and also that there still
remains a nervousness by construction participants to fully committing to these
best practice open relationships which appear to potentially render parties
commercially vulnerable.

In response to the question does the use of partnering result in the greater use of
best practices and does the use of partnering lead to improved project performance
the answer was seen as yes. However it must also be noted that the industry was
viewed as still having a lot of progress needed to fully embrace the new best
practice working practices which will move it away from the traditional
confrontational culture and towards the full realisation of the benefits that
partnering and adoption of other construction best practices can bring to
construction projects.

The next stage in this research area is to adopt a qualitative approach and carry
out a higher number of interviews to further ascertain whether the use of
partnering does lead to improved project performance and to quantify that extent.

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References

Akintoye, A, and Main, J. (2007) Collaborative Relationships in Construction: the UK

contractors’ perception. Engineering, Construction and Architectural
Management, 14(6), pp. 597-617.
Ashworth, A. & Hogg, K. (2000) Added Value in design and construction. Essex:
Pearson
Bennet, J. Jayes, S (1995) Trusting the Team, The Best Practice Guide to
Partnering in Construction. Reading: Centre for Strategic Studies in
Construction.
Bresnen, M. and Marshall, N. (2000) Partnering in construction: a critical review of
issues, problems and dilemmas. Construction Management and Economics,
18(-), pp. 229-237.
CIOB (2006) Corruption in the UK Construction Industry., London: CIOB Report.
Constructing Excellence (2009a) Be Inspired [online] UK: Constructing Excellence
[cited 11th February 2009].
http://www.constructingexcellence.org.uk/sectorforums/buildingestatesforum
Constructing Excellence (2009b) Construction Best Practice, Best Practice Explorer
Themes. [online] UK: Constructing Excellence [cited 11th February 2009].
http://www.constructingexcellence.org.uk//resources/themes/.
Egan, JL. (1998) Rethinking Construction. London: Rethinking Construction
Egan, JL. (2002) Accelerating Change: A report by the strategic forum for
construction. London: Rethinking Construction.
Greaves, A. Sheath, D, Rowe, D. Sykes M. (1998) Constructing the Best
Government Client. ACI: Bath: University of Bath.
Holt, G.D, Love, P.E.D, Li, H (2000), "The learning organization: a paradigm for
mutually beneficial strategic construction alliances", International Journal of
Project Management, Vol. 18 No.6.
Latham, M (1994), Constructing the Team: Joint Review of Procurement and
Contractual Arrangements in the United Kingdom Construction Industry, HM
Stationery Office, London.
Leading Edge Management Consultancy Ltd (2008) Drivers of Change in the
Construction Industry, Egan, Latham & Industry Initiatives. Berkshire: CPD.
Local Government Task Force (2005) Showcasing Excellence, The North Tyneside
Partnering Agreement, Case Study 1.London: Local Government Task Force.
Mosey, D (2009) Early contractor involvement in building procurement: contracts,
partnering and project management. Chichester: Wiley-Blackwell
McCabe, S. (2001) Benchmarking in Construction. Oxford: Blackwell Science.
McGeorge, D. & Palmer, A. (1997) Construction Management - New Directions.
Oxford: Blackwell Science
Murray, M. Langford, D. (2003) Construction Reports 1944-98. Oxford: Blackwell
Publishing.
OGC (2005) Birmingham Construction Partnership, Case study. London: Local
Government Task Force.
OGC (2007) Construction project performance results and future data collection
arguments - Information note 1. London: Office of Government Commerce.
OGC (2009) Office of Government Commerce, Achieving Excellence in Construction
[online]. UK: OGC, [cited 12th February 2009].
http://www.ogc.gov.uk/guidance_achieving_excellence_in_construction_4675.a
sp.
Rowlinson, S. & McDermot, P. (1999) Procurement Systems – A guide to Best
Practice in Construction. London: E&F Spon.
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W03

Decision Support System (DSS): A Strategic Tool for the Affordable

Housing Industry

Imad Dawood
(Research Institute of the Built and Human EnvironmentUniversity of Salford, UK)

Dr. Jason Underwood

(Research Institute of the Built and Human EnvironmentUniversity of Salford, UK)

Abstract
The housing industry in the Developing World and for long time has suffered from
underinvestment, the lack of knowhow and the lack of sufficient strategies and
policies. This in turn, led to a total failure in performance, accumulative massive
housing demand and underachieving. Consequently, and because of the massive
growth in the world’s population, especially the Islamic World, people in the poorest
countries have been the most affected and forced to live in slums and shanty towns
which some worldwide have millions of occupants.
This research paper presents a scientific approach to assist governments and
decision makers in the Islamic World setting up most sufficient and effective
strategies and policies on the mega-level (country level) for the housing industry.
The final outcome of this research will produce a Decision Support System Model
(DSS) which could be used by decision makers to setting up holistic, realistic and
achievable strategies and policies based on the scientific interpretation of the
interface of the DSS Model.

Keywords
Housing Industry, Housing Industry Factors, Decision Support System Model (DSS).

Note: It is important to keep in mind first that the purpose of this research is
neither about the house’s or project’s design, style, size, type of coating, quality of
building materials nor about types of land.

1. Introduction

The housing industry in the Developing World and for long time has suffered from
underinvestment, the lack of knowhow and the lack of sufficient strategies and
policies. This in turn, led to a total failure in performance, accumulative massive
housing demand and underachieving. Consequently, and because of the massive
growth in the world’s population, especially the Islamic World, people in the poorest
countries have been the most affected and forced to live in slums and shanty towns
which some worldwide have millions of occupants.
Planning and setting strategies and policies is not an easy task facing managers,
leaders and decision makers at all levels such as SMEs, organisations and
industries. This means that managers, leaders and decision makers at micro, macro
and mega level facing a dilemma in making their decision because decision making
may lead to either prosperity or disaster affecting the entire nation. Thus, there are
tools, methods, mechanisms and systems: computer assisted, mathematical and
statistical, contextual and logical, etc. introduced to assist and help managers,

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leaders and decision makers making appropriate decisions that keep their
organisations in business and deliver products and services to customers on time,
reasonably priced and high quality. In other words, these tools assist managers and
leader making decision aiming at high satisfaction for stakeholders including
organisations, employees, customers, etc.
This research paper will only focus on Decision Support System (DSS) Model and
presents a scientific approach to assist governments and decision makers in the
Developing World setting up most sufficient and effective strategies and policies on
the mega-level (country level) for the housing industry.
The research methodology will consist of two parts; literature review which shed
light on DSS Model in terms of definition, stages, purposes, mechanism, how it
functions, etc. The second will introduce Interpretive Structural Model (ISM), which
is used previously in a different stage of research to identify and prioritise Housing
Industry Variables and DSS Model. Finally, the DSS Model will be examined and
tested using different scenarios for validation. The findings will be stated in the
concluding section.

2. ISM: Prioritising Housing Industry Variables

Our detailed investigation has revealed that there are 14 major factors that could
influence the rebuilding of the housing industry. These are:
1. Regulation & Legislations

2. Finance

3. Size of Projects

4. Availability of Local Professionals mainly Engineers and Project Managers

5. Availability of Foreign Know How

6. Availability of Building Materials

7. Availability Local Labour

8. Availability of Foreign Labour

9. Availability of Land

10. Development of Private Sector (SMEs)

11. Training required to build up local capacity

12. Types of Construction Method (traditional building Vs off-site manufacturing)

13. Design of affordable housing to meet the demand

14. Procurement/ type of contract

When a prioritising test was implemented to rank the above variables according to
their power and dependency, it was interesting to find that Regulation is the main
driver and enabler, see Figure 1 (in the Appendix at the end).

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3. Decision Support System Model (DSS)

In this section, Literature Review will thoroughly investigate and discuss Decision
Support System (DSS) in terms of definitions, mechanism, advantages,
disadvantages, etc. Moreover, the discussion will display how this tool could assist
managers in making appropriate decision at all levels.

3.1 Definition

Gerson M. et al (1992) suggest that various forms of decision making occur at

various levels. DSS does not specify an optimum decision, but rather helps a
decision maker to clarify options. In other words, a DSS includes applications used
by decision makers which specifically assist in understanding or structuring the
decision. Moreover a DSS looks at the ability of an application to generate
stochastic measures and to implement sensitivity analyses on data.

3.2 Rules for Building Successful DSS

Power (2003) presents five recommendations and six rules should be considered
when building a computerised DSS model. Moreover, Power (2003) and McCosh &
Scott-Morton (1978) share the same views and classify similarly the rules on how
to build a successful DSS. These rules are as follows:

Rule 1: Novel, innovative model-driven Decision Support Systems should be

initiated by the managers who would use them.
Rule 2: Users and technical specialists should periodically review, evaluate and
adjust existing model-driven Decision Support Systems. Many model-driven DSS
are "legacy" applications that potentially could be upgraded and improved.
Rule 3: Decision Support System projects must meet a need and provide benefits
that justify the ongoing cost of operating, maintaining and upgrading the system as
well as the cost of building them.
Rule 4: Model-driven DSS should be built by teams that include potential users
and technical specialists. Conceptualising a model in its "gross form" for a model-
driven DSS is not the major issue.
Rule 5: In every case, all things being equal, choose the path of least resistance
when building and implementing DSS.

3.3 Spreadsheet Based DSS

Computer applications such as Word-processor, Spreadsheet and Database can be

used as tools in DSS to provide accurate information and interpretation based on
data that assist managers and leaders making decision upon sensitivity analysis.

Power (2000) argues that a DSS that has been or will be implemented using a
spreadsheet package can be termed a spreadsheet-based DSS. Moreover, a
spreadsheet-based DSS presents a simple and friendly use interface for managers
because it a collection of cells whose values can be displayed on a computer screen.
An electronic spreadsheet organises data into columns and rows. The data can then
be manipulated by a formula to give an average, maximum or sum. By changing
cell definitions and having all cell values re-evaluated, a user performs "What-If?"
analysis and observes the effects of those changes.

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Power (2000) suggests that there are two Models: Model-driven and Data-driven, of
spreadsheet-based DSS, and are the most common types of DSS one would
consider developing using a spreadsheet package. These two models are as follows:
1. Model-driven is spreadsheets seem especially appropriate for building a DSS
with one or more small models. A developer would then add buttons,
spinners and other tools to support a decision maker in "What-If?" and
sensitivity analysis.
2. Data-driven DSS can be implemented using a spreadsheet. A large data set
can be downloaded to the DSS application from a Database Management
System (DBMS), a website or a delimited flat file. Then, tables and charts
can be developed to help a decision maker summarise and manipulate the
data.
Power (2000) adds that spreadsheet packages qualify as DSS generators because:

a. they have sophisticated data handling and graphic capabilities;

b. they can be used for "What-If" analysis; and

c. spreadsheet software can facilitate the building of a DSS.

3.4 What-If Analysis

Power (2006) argues that Microsoft Excel 2002 help defines "What-If analysis" as a
process of changing the values in cells to see how those changes affect the
outcome of formulas on the worksheet. Winston (2004) identifies four tools in Excel
that are commonly categorised as "What-If?" or sensitivity analysis tools. These
tools are such as Data Tables, Goal Seek, Scenarios, and Solver. The simplest type
of "What-If?" analysis is manually changing a value in a cell that is used in a
formula to see the result. Excel experts seem to use the terms sensitivity and
"What-If?" analysis interchangeably.

3.5 Advantages/Benefits

Power (2002), argues that the advantages and benefits of DSS are as follows:

1. Cost reduction: Reduce costs of inputs from suppliers, decrease the lead
times and holding costs.
2. Decision cycle time reduction: Speed up decision making by a stakeholder
and potentially reduce internal decision cycle times.
3. Collaboration: Increase collaboration and information sharing.
4. Competitive situation: Alter competition in the industry by better meeting
needs of a customer.
5. Revenue: Create new sources of revenue.
6. Participative design: Allow customers and other stakeholders to participate in
product/service design decisions.
7. Repeat purchase and use: Create relational or product dependency and
encourage repeated use of the DSS for decision making.
8. Process improvements: Reduce decision process and decision making
inefficiencies.

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It seems there are several advantages resulted from using DSS. Managers,
executive and leaders could improve the organisational and their performances by
resorting to implementing DSS. DSS offers scientific, computerised and
sophisticated tools that assist managers making decisions and taking appropriate
actions.

3.6 DSS Limitations

EL-Najdawi and Stylianou (1993) argue that a DSS is a set of computer-based tools
used by managers to assist them in their decision making. Some of the problems
and limitations of DSS are listed below:

 A DSS is useful when dealing with only a subset of all possible semi-
structured problems.
 The DSS's contribution to the problem-solving process is limited to the
evaluation of alternatives.
 A DSS does not relieve the manager from making the actual decisions.
 Problems suitable for a DSS must have a quantifiable dimension.
 The structure of a problem and the criteria involved in evaluating the
problem must be defined by the decision maker.
 Users are frequently unable to effectively communicate their needs to the
computer.

3.7 DSS Model Initial Structure

The DSS structure will be of five engines and an interface. The engines will be
responsible for the calculations using formula where as the interface will display
and reveal the changes desired and required by decision makers. The DSS Model
structure would look like Figure 4 see (in the Appendix at the end).

Figure 5 listed in the Appendix below is an MS Excel image of the Interface of the
DSS Model.

4. Conclusion

Decision Support System (DSS) Model as a TOOL produced by this research study
has proven its efficiency and effectiveness not only to the housing industry, but also
to improve other industries and therefore the entire economy. A person could ask a
question that the DSS Model for the housing industry operates on the elements and
factors of this particular industry; who is the DSS Model going to affect other
industries and the entire economy? The answer is that the DSS Model negotiates
housing industry factors such as Labour (Local, Foreign, Skilled, Unskilled, Training,
etc.), Project Management (Local, Foreign, Training, etc.), Administrative and Office
Staff, Building Materials (Local Factories and Plants, Capacity of Productions, Labour
to run the Plants, Import, SMEs, etc), Land (Government, Private, etc.). All the
Factors of the housing industry are also related to different ministries such as Work
and Social Assurance, Education, Higher Education, Planning, Finance, Economics,
Foreign Affairs, Interior, etc. In other words, in order to improve the performance
of the housing industry to meet its mammoth tasks, governments and decision
makers have to realise that this process must be synchronised and carried out
simultaneously with the improvement of other industries such as Work and Social
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Assurance, Education, Higher Education, Planning, Finance, Economics, Foreign

Affairs, Interior, etc.
Moreover, according to the ISM Model; Regulations and Legislations are the most
powerful and driver power among the 14 factors identified by literature. Therefore;
governments and decision makers have to realise that setting New Regulations and
Legislations are not only for the housing industry, but also for other industries
because other industries in one or another are closely linked and involved in
providing Finance, Labour, Project Management, Administration, Building Materials,
Land, etc.
The message to governments and decision makers is that to improve the
performance of the housing industry requires a holistic re-consideration of the
entire economy in terms of setting New Regulations and Legislations. This means
that improving a performance of an industry (in this case the Housing Industry)
requires genuine steps from governments, parliaments and decision makers to
REFORM the entire economy.
Finally, the DSS Model can be used as a TOOL by governments, parliaments and
decision makers to identify the CRITICAL FACTOR(S), size potential problems,
vulnerable areas in the economy, prioritise of Factors, clarify the starting point of
Reform and so on and so forth.

5. References

Adams R J. (1990), A System to Improve the Availability of Information for

Library Managers. In Burton P F (editor). MS-DOS Software For Library
And Information Applications, Gower Publishing 1990 ISBN 0 566 03617
7 pp123-135, Emerald Back-files 2007
Bannerman S. (1992) Sensitivity Analysis for Property Appraisal, ULR:
http://www.emeraldinsight.com/Insight/viewPDF.jsp?Filename=html/Out
put/Published/EmeraldFullTextArticle/Pdf/1120110305.pdf , Accessed
(21/06/2009).
E1-Najdawi M. K. And Stylianou A. C. (1993), Expert Support Systems:
Integrating AI Technologies, December 1993/Vol.36, No.12.
Gerson M., Chien, I. S. and Raval V., (1992), Computer Assisted Decision
Support Systems: Their Use in Strategic Decision Making, Eugene C.
Eppley College of Business Administration, Creighton University, Omaha,
NE, 681781992 ACM 089791-501-1/92/0004/0152
McCosh, A. M and Scott Morton, M. S., Management Decision Support
Systems, London, Macmillan, 1978.
Mcrit.com (2008)
http://www.mcrit.com/ASSEMBLING/assemb_central/WhatESS.htm
Pannell, D.J. (1997). Sensitivity Analysis of Normative Economic Models:
Theoretical Framework and Practical Strategies. Agricultural Economics
16: 139-152, at URL:
http://cyllene.uwa.edu.au/~dpannell/dpap971f.htm , Accessed
(21/06/2009).
Power, D. J., (2000) "A Brief History of Spreadsheets". Version 3.3, March
11, 2000, URL: http://dssresources.com/history/sshistory.html , ,
Accessed (21/06/2009).

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Power, D.J, (2003), What are the characteristics of a Decision Support

System? DSS News, Vol. 4, No. 7, March 30, 2003.
Power, D.J, (2006) "What is Planners Lab?" DSS News, Vol. 7, No. 11, May
21, 2006.
Whyte Roderick G (1986) What is a Decision Support System? Managing
Director, Information Resources, UK IMDS, Emerald Back-files 2007.
Winston, W. L., Microsoft Excel Data Analysis and Business Modelling,
Microsoft Press, 2004.

6. Appendix

Figure 1: Hierarchy of Housing Industry Variables by ISM (Dawood and

Alshawi 2009)

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Figure 2: DSS Stages (Mcrit.com, 2008)

Figure 3: DSS Stages (Mcrit.com, 2008)

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Figure 4: DSS Model Structure

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W04
Research Methodology Explained

Imad Dawood
(Research Institute of the Built and Human Environment (BuHu),University of
Salford, UK)

Dr. Jason Underwood

(Research Institute of the Built and Human Environment (BuHu).University of
Salford, UK)

Abstract
Research Methodology is one of the nightmares a researcher has to endure. It is so
confusing and misleading because it is derived from philosophy. Philosophy itself is
hard to comprehend and explain even by experts in the field. The reason is that
philosophy was first explored in the 5th Century BC by the infamous Greek
philosophers such as Aristotle, Socrates, and Plato who are regarded as the fathers
of philosophy.
Scholars and Experts in the field of Research Methodology have invested so much
time and effort attempting to draw a clear picture of the Process of Research
Methodology which is derived from Philosophy. However, most attempts or perhaps
models of research are still hard to comprehend, understand and follow. In the light
of this, Saunders et al (2003, 2006) have introduced great Models namely The
Research Process Onion, which is widely used by researchers to justify their
research. However, Saunders Research Process Onion Models (2003, 2006) can be
greatly improved by including and positioning Epistemology and Ontology on the
model. This attempt will draw a clearer picture about research process and make it
easier to understand and follow by researchers.
The outcome of this research is expected to produce a comprehensive Research
Methodology Model which is broader, clearer and links and displays the relations
and hierarchy among philosophical and technical terms and domains such as
Axiology, Epistemology, Ontology, Research Philosophy, Research Approach,
Research Strategy, Research Choices, Time Horizons and Data Techniques.

Keywords
Philosophy, Epistemology, Ontology, Axiology, Research Methodology.

1. Introduction

The first challenge a postgraduate researcher encounters is understanding research

methodologies available and then select a method that is most suitable for his
research, not to mention the struggle against time and cost to getting results.
Philosophy and research methodology is really so hard to comprehend and follow by
researchers, therefore, most researchers are scared to enter and forced to out this
particular field. So, what is the problem? Is it Philosophy/Research Methodology,
the researcher, or the way Philosophy/Research Methodology is interpreted and
presented? The answer is, neither Philosophy/Research Methodology, nor the
researcher is the problem. It is in fact the interpretation of philosophy,
philosophical terms, diagrams, models, etc. related to the field of research
methodology presented by scholars and writers which are not adequate,
complicated, confusing, misleading, etc. Nowaday; there are several schools and
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branches of philosophy. The discipline of philosophy is also taught at universities

worldwide. Moreover, there are a number of attempts to explore and exploit
research methodology for scientific disciplines and social sciences. The work of
scholars and experts results in producing models which explain research nature,
path stages, etc.

This paper presents an attempt to draw a holistic and clearer picture about research
process and make it easier to understand and follow by researchers. Moreover, a
critical analysis will be presented on a presentation in a workshop of Research
Methodology entitled “PhD Research: Axiological Purposes, Ontological Cages and
Epistemological Keys”. The Presentation was given in March 2007 by Prof. Martin
Sexton, Built Environment, University of Salford, UK. The Presentation was 81
Slides long. The aims of including Prof. Sexton Model are to display the confusion
and dilemma a new PhD researcher has to endure when such a thing is presented
in such a way.

This research is based on literature review. The outcome is expected to produce a

comprehensive Research Methodology Model which is broader, clearer and links and
displays the relations and hierarchy among philosophical and technical terms and
domains such as Philosophy, Epistemology, Ontology, Research Approach, Research
Strategy, Research Choices, Time Horizons and Axiology/Data Techniques and
Procedures.

2. Philosophy

In this section; a brief discussion (definition, branches) of the term philosophy will
be given to understand the dimensions and domains of this illusive term.

2.1 Definition

Britannica Dictionary Online (2009) state that the word Philosophy is of Greek
origin: φιλοσοφία, philosophía. Philosophy means “Love of Wisdom or Love of
Knowledge”.
The Dictionary of Philosophy defines Philosophy as seeking of wisdom and the
wisdom sought. Originally, philosophy is the rational explanation of anything; the
general principles under which all facts could be explained; in this sense,
indistinguishable from science.

2.2 Philosophy Branches

Landauer and Rowlands (2001) argue that there are five branches of philosophy
namely Metaphysics, Epistemology, Ethics, Politics and Atheistic, whereas the
Dictionary of Philosophy suggests that Philosophy includes metaphysics,
epistemology, logic, ethics, aesthetics, etc. There is not much different between the
two classifications. Politics in Landauer and Rowlands (2001) is replaced by Logic.
This is not a major difference and politic depends on a logical explanation to justify
beliefs. According to the two arguments the five philosophical branches could be
could be extracted and explained in Table 1 as follows:

Metaphysics Study of Existence What's out there?

Epistemology Study of Knowledge How do I know about it?

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Ethics Study of Action What should I do?

What reasoning and argumentation are
Logic Study of Linguistics
permissible?
Aesthetics Study of Art What can life be like?
Table 1: Five Branches of Philosophy (Landauer and Rowlands, 2001, Dictionary of
Philosophy, 2009)

3. Epistemology

Phillimore and Goodson (2004) claim that Epistemology is the theory of knowledge,
and is interested in the origins and nature of knowing and the construction of
knowledge, and the claims and assumptions that are made about what the nature
of knowledge is. Moreover, Stanford Encyclopaedia of Philosophy (2005) defines
Epistemology is the study of knowledge and justified belief. As the study of
knowledge, epistemology is concerned with the following questions: What are the
necessary and sufficient conditions of knowledge? What are its sources? What is its
structure, and what are its limits? As the study of justified belief, epistemology
aims to answer questions such as: How we are to understand the concept of
justification? What makes justified beliefs justified? Is justification internal or
external to one's own mind? Understood more broadly, epistemology is about
issues having to do with the creation and dissemination of knowledge in particular
areas of inquiry.

4. Ontology

Weber (2004) claims that ontology is a person (researcher) and reality are separate
(positivism) and a person (researcher) and reality are inseparable in life-world
(interpretivisim). Moreover, Lowe (2006) claims that Ontology has two aspects;
the first is objectivism which portrays the position that social entities exist in reality
external to social actors concerned with their existence. The second is subjectivism
which holds that social phenomena are created from the perceptions and
consequent actions of those social actors concerned with their existence. Thus,
Ontology is analysing the nature of the universe itself and everything within the
universe through two aspects: objectivism and subjectivism.

5. Axiology/ Data Collection Techniques, Procedures & Evaluation

Britannica Encyclopaedia Online (2009) state that Axiology from the Greek axia
(αξια, value, worth), is the study of value or quality. It is often thought to include
ethics and aesthetics philosophical fields that depend crucially on notions of value,
and sometimes it is held to lay the groundwork for these fields, and thus to be
similar to value theory and meta-ethics. Moreover, Bahm (1993) argues that the
term was used in the 19th and early 20th centuries, but in recent decades, value
theory has tended to replace it in discussions of the nature of value or goodness in
general. Thus, testing the value of knowledge can be achieved by the benefits it
creates to humans. In research, this can be done by investigating the clients’/end-
users’ views and opinions in forms of qualitative and quantitative surveys. Perhaps
some times a researcher ought to use both methods (qualitative and quantitative)
to better assess the value of his product. It is important to notice that Saunders et
al (2006) did not state the relation between values and knowledge. Saunders et al

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(2006) focus on data collection techniques and procedures to assess the value and
quality of a research, which is widely known as Axiology.

6. Research Reasoning/Approaches

Although Saunders et al (2003) believe that making a link between a particular

research philosophy and either of the two research approaches, deductive and
inductive, “is potentially misleading and of no practical value”, they do, in fact, link
the deductive approach to positivism and the inductive approach to interpretivism.
A third approach (Abductive) was named which links together inductive and
detective reasoning. Levin-Rozalis (2004) calls the logical process of discovery
“abduction” and state that we cannot ignore the process of discovery in science,
leaving it to the history of science or psychology. The process of discovery that
intends to provide an explanation of a new or surprising fact is subject to logical
categories and criteria such as the process of proof. A new or surprising fact is one
we did not expect to find, either because we did not know what to look for in the
first place, or because the fact was beyond our expectations of what we were about
to, or should find. Discovery is the process that leads us from the fact to an
established scientific explanation of it.

7. Research Strategies

Saunders et al (2006) claim that research strategies available are such as

experiment, survey, case study, grounded theory, ethnography, action research,
etc.

8. Research Choices

Saunders et al (2006) argue that a researcher has more than one option to select
research strategies. These choices are namely Mono Method (single method), Mixed
Methods and Multi-Methods.

9. Time Horizons

Saunders et al (2006) suggest that Time Horizon is the process where the
researcher dedicates his time to perform his research. Since a research could be
divided into processes, therefore a researcher could work on a single and use the
results into the following. If the research is not process dependant, then a
researcher could work on multi-process to utilise and manage time.

10. Existing Models

In the following two existing Research Models will be discussed, analysed and
criticised. These Models are Saunders et al (2006) so-called Research Process
Onion and Sexton (2007) PhD Research Methodology Model.

10.1 Research Process Onion

In this part, the discussion focuses and analyses The Research Process “Onion”
proposed by Saunders et al (2003, 2006). The following Figure 1 shows the
Saunders (2003) Research Process Onion:

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Figure 1: Research Process Onion (Saunders et al, 2003).

Figure 2: Research Process Onion (Saunders et al, 2006).

The models in Figures 1&2 are good to some extents. Researchers have utilised and
use it to justify their research. However, Saunders Onion Model lacks many things
as follows:
1. The Models are ambiguous and complicated.

2. Axiology, Ontology and Epistemology are not clearly positioned and do not
appear on the Model.

3. There is no clear identification of Philosophy and its five branches such as

Metaphysics, Epistemology, Ethics, Logic and Atheistic.

4. The outside layer is so congested (Saunders 2006) and has mix terms and
branches of different nature and purpose such as Epistemology and
Ontology.

5. The inside layer should be marked as Axiology which will help a research
understand the meaning, purpose and domain of the term itself.

The above criticism to Saunders (2003-2006) Research Onion Models will be used
to structure and justify the New Research Methodology Model at the end.

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10.2 PhD Research Methodology Model

The following discussion focuses on Saxton (2007) Model which has been given in
seminars and training session for PhD researchers at the University of Salford.

Sexton (2007) PhD Research Model is presented in the following two Figures 2&3:

Figure 2: PhD Research Model (2007-1)

The following Figure 3 below represents the second half of the Model:

Figure 2: PhD Research Model (2007-2)

Sexton (2004) Model is too confusing especially for researchers who are not native
speakers of English. The interpretation and understanding of the Model requires
months to comprehend and understand. Any amount of time is considered precious
for any PhD researcher especially, the overseas ones. Scholars and writers should
understand that the majority of PhD researchers are from overseas and therefore
should present their work in a very simple manner. A PhD on its own is a mammoth
task. Normally, a PhD needs many years to complete and with this compulsory
aspect of a research (understanding and identifying Research Methodology) it
makes it even harder to finish. In fact, the way the PhD Research Model was

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present may discourage researchers from using it as a guide and perhaps even
looking at it.
The criticism of Sexton (2007) PhD Research Model is as follows:
1. There is a great contradiction between Saunders (2003) and Sexton (2004);
Saunders (2003), in the outside layer consider Positivism, Interpretivism and
Realism as Research Philosophies/Epistemologies, whereas Sexton (2007)
consider only Positivism and Interpretivism and Realism as a branch of
Ontology which are two different philosophies.

2. The research finds that Ontology has two aspects namely Subjectivism and
Objectivism; whereas Sexton (2007) argue that Ontology is Realism and
Idealism.

3. Sexton (2007) Model argues that Subjectivism and Objectivism as

approaches where as Saunders (2003-2006) Models classifies Approaches as
Inductive and Deductive.

4. There is no reference to Research Strategies in the Model.

5. The Model did not identify and define the domain of term Philosophy.

If a researcher studies Saunders and Sexton Research Models, definitely s/he will
be significantly confused, misled, frustrated, etc. because of all the contradiction
between the two Models. For example: what is approach in one model means
different term or notion in another, what is strategy in one strategy in one model
also means another and what is Axiology, Epistemology and Ontology in one model
refers to different philosophies in another.

11. New Proposed Research Methodology Model

The New Research Model will be called “Research Methodology Life Cycle”. This
Model is believed to be easier, simpler and more comprehensive. The following
Research Model in Figure 5 is proposed and believed to help better researchers in
their researching process. The New Model based upon the above discussions and
arguments:

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Figure 5: Research Methodology Life Cycle (Dawood and Underwood, 2010)

The New Model in Figure 5 is based on the concepts, notions and terms of Saunders
(2003-2006) Models because the models are clearer, easier and more
comprehensive than Sexton (2007) Model.
Considering the New Model, a researcher realises that a holistic picture is drawn
regarding research methodology and include regular notions and phenomena. The
structure of the New Model starts with defining the branches of the term
philosophy. It also defines the domains of the illusive terms Epistemology and
Ontology respectively. It presents the types of Research Approaches available. The
aspects of strategies are presented. Research Choices and Time Horizons are
introduced. Finally, Axiology is investigated and linked to data collection techniques
and procedures.

6. Conclusion

This research criticised and justified the lack in Saunders (2003, 2006) Research
Process “Onion” Models and Sexton (2007) Model. Saunders Models displays and
presents a reasonably good model may be used by researchers to justify their
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research, however, it lack the identifications and differentiations among Philosophy,

Epistemology, Ontology, Axiology, etc. On the contrary, Sexton Model is totally
misleading because there is a massive use of misconception of the terms and
notions such as Epistemology, Ontology, Axiology, etc. There is no reference to
Philosophy and its branches. Moreover, Sexton Model explained in more than one
Figure/Diagram, therefore, researchers find it too difficult to comprehend and
follow, especially, researchers from overseas where English is not their first
language.
The New Research Methodology Model leans slightly to Saunders (2003-2006)
Models because it is easier and better than Sexton Model. The New Research
Methodology Model presents a holistic picture of a research starting from
Philosophy and ending with Axiology. The New Model is more comprehensive
because it clarifies and classifies all the terms and notions related to research life
cycle. A research will learn, conceptualise and differentiate by observing the Model
about what is Philosophy and its branches, the domain of Epistemology and its
branches, the concept of Ontology, the types of Research Reasoning and
Approaches, research strategies available Axiology and Data Collection Techniques
and Procedures, etc. this holistic picture is partially presented by Saunders Models
and partially and chaotically by Sexton Model. Time is crucial for a researcher;
therefore, a researcher does not appreciate learning about research methodology
the way it is partially or perhaps incompletely presented by Saunders Model.
Moreover, Sexton Model may lead the researcher to be frustration, anxiety, loss of
confidence because the model is greatly misleading. These issues will take more
time from it was expected and put the researcher under greater pressure.
It is anticipated that the New Research Methodology Model will help researcher
conducting and progressing better in their research and reduces the time working
on research philosophy rather the research itself.
Finally, because all disciplines: Social Sciences, Humanities, Pure sciences, etc, are
closely interrelated and overlapping; therefore, this research paper is definitely
related and concerned to Construction and other areas of research.

12. References

Bahm A. J. (1993) Axiology: The Science of Values, Value Inquiry Book, Vol 2,
Editions Rodopi, New York.
“Britannica Encyclopaedia Online” (2009), ULR:
http://www.britannica.com/EBchecked/topic/456811/philosophy
Dictionary of Philosophy ; edited by Runes D.D. Philosophical Library of N.Y. cpy rt:
1942; Philosophical Library Inc.]
“Diverse Cultures”, Springer Science + Business Media B.V., Library of Congress
Control Number: 2007936007, Springer.com.
Khine M. S., (2008) Knowing, Knowledge and Beliefs; Epistemological Studies
across
Landauer J. and Rowlands J. (2001) The Importance of Philosophy, ULR:
http://www.importanceofphilosophy.com/FiveBranchesMain.html , (Accessed;
10/06/2009)
Levin-Rozalis M. (2004), Searching for the Unknowable: A Process of Detection –
Abductive Research Generated by Projective Techniques, International Journal
of Qualitative Methods 3 (2) June, 2004.
Lowe E. J. , (2006), The Four-Category Ontology; A Metaphysical Foundation for

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Natural Science, Clarendon Press. Oxford.

Phillimore J. and Goodson J., (2004), Qualitative Research in Tourism; Ontologies,
epistemologies and methodologies, Routledge, London.
Saunders, M., Lewis, P. & Thornhill, A. (2003), Research Methods for Business
Students. 3rd Edition, Pearson Education Ltd, Harlow.
Saunders, M., Lewis, P. & Thornhill, A. (2006), Research Methods for Business
Students.4th Edition, Pearson Education Ltd, Harlow.
Sexton M. (2007), PhD Research: Axiological Purposes, Ontological Cages and
Epistemological Keys, A Postgraduate Workshop Presentation, March 2007,
University of Salford, UK.
Stanford Encyclopaedia of Philosophy (2005), Epistemology Definition. ULR:
http://plato.stanford.edu/entries/epistemology/
The Internet Encyclopaedia of Philosophy (2009); Greek Philosophy, ULR:
http://www.iep.utm.edu/g/greekphi.htm
Weber R (2004), The Rhetoric of Positivism Versus Interpretivism, MIS Quarterly,
Vol. 28 No. 1, pp. iii-xii/March 2004.

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AA113

First five years of conducting the Management in Civil Engineering

group of courses within the Professional Study Programme and the
Polytechnic Graduate Professional Study Programme in the
Polytechnic of Zagreb

Časlav Dunović, M.Eng.C.E.

(Polytechnic of Zagreb - Department for civil engineering, Zagreb, Croatia)

Boris Uremović, M.Eng.C.E.

(Polytechnic of Zagreb - Department for civil engineering, Zagreb, Croatia)

Domagoj Šojat, B.Eng.C.E.

(Student at the Polytechnic of Zagreb - Department for civil engineering, Zagreb,
Croatia)

Abstract
The Polytechnic of Zagreb organised two study programmes, a 3-year Professional
Study Programme and 2-year Polytechnic Graduate Professional Study Programme,
and within those study programmes it embedded a group of courses about
Management in Civil Engineering.
With this paper we will try to review some of the basic success indicators of that
group of courses, e.g. enlisted students, finished students, average grades, etc.
We will also try to review the results of the survey conducted among the students
of both study programmes who took the fore mentioned group of courses. The
survey regarded the student opinion on education conduction and their general
grades of the study as a whole.
The results will show the students general opinion about these groups of courses,
and it will show that the basic success indicators point to a well balanced and
concerted group of courses about Management in Civil Engineering within both
study programmes.

Keywords
Study programme, student survey, success indicators

1. Short history and introduction to Polytechnic of Zagreb

The Civil Engineering Department of the Polytechnic of Zagreb has had over forty
years of experience in the organization and development of professional study
programmes. Since its foundation till 2004/05, when it was separated from the
Faculty of Civil Engineering, and entered in to the official Register of scientific
institutions, the Polytechnic has been carrying out 3-year professional study
programmes. Since Croatia has decided to adopt two-cycle study programmes in
both academic and professional study programmes, The Polytechnic of Zagreb
organised two study programmes, a 3-year Professional Study Programme and 2-
year Polytechnic Graduate Professional Study Programme, and within those study
programmes it embedded a group of courses about Management in Civil
Engineering.

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2. Professional Study Programme in Civil Engineering

The main objective of professional civil engineering studies is to educate civil

engineering experts that will be able to meet ever-growing demands of the present
day construction industry. The curriculum has been composed in such a way to
provide expert knowledge related to civil engineering projects, technology of their
realization, and organization of construction work. In addition to an optimally
proportioned theoretical background, a particular attention is paid to the practical
part of the curriculum consisting of practical sessions, autonomous but tutored
solving of assignments, field work and also practical work which is related to the
final examination. Upon completion of their studies, our graduates have proven to
be capable of meeting all challenges encountered in the realization of construction
projects, mainly because they have acquired, in the course of their studies, highly-
specialized skills and knowledge on construction projects, as well as the knowledge
and skills relating to construction technologies, site organization, quality control and
quality assurance, control of expenditures, construction regulations, environmental
protection, etc.

After the initial three semesters during which all students are involved in the same
courses of study, the next three-semester programme has been traditionally
offering two groups of courses: Building Construction and Civil Engineering (Water
and traffic infrastructure). After an extensive analysis of needs in the construction
industry, and following various student opinion surveys conducted in recent years,
the Polytechnic of Zagreb has decided to offer an additional group of courses -
Management in Civil Engineering.

The need for a programme focusing on development of an entrepreneurial and

managerial spirit is increasingly felt in construction practice as a result of rapid
development of this industry. According to the surveys, one third of our students
would opt for Management in Civil Engineering because they know that, due to the
rapid development of private entrepreneurship, they may expect to find
employment in that sector or develop their own business as soon as they complete
their studies.

A first cycle Professional Study Programme in Civil Engineering is carried out in six
semesters. After the completion of the first three semesters, four groups of courses
are offered in this programme; Building Construction; Water and traffic
infrastructure in Civil Engineering; Civil and Environmental Engineering;
Management in Civil Engineering. The total acquired number of ECTS credits is
180, and after the completion of their studies, the students acquire the title of
Bachelor of Civil Engineering and are qualified for work in many fields of the Civil
Engineering industry.

In the following tables curriculum for Management in Civil Engineering will be

presented. Table 1 shows common courses for all four groups of courses which are
offered in this study programme, and are especially related to organization,
management and technology. Table 2 presents the group of courses offered only in
the Management in Civil Engineering group of courses.

Numbe Hours
Hours of Hours of
Semeste r of of
Course r
Exams
ECTS Lecture
Excercise Individu
s al Work
Credits s

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CONSTRUCTION
IV 1 4 30 15 75
MACHINERY
FIELD PRACTICE IV 2 30 30
CONSTRUCTION
V 1 5 30 30 90
MANAGEMENT I
CONSTRUCTION
VI 1 5 30 30 90
MANAGEMENT II
CONSTRUCTION
V 1 5 30 30 90
TECHNOLOGY
FINAL WORK WITH
VI 20 15 195 390
FIELD PRACTICE

Table 1: Common courses for all four groups of courses which are offered in this
study programme and are especially related to organization, management and
technology

Numbe Hours
Hours of Hours of
Semest r of of
Course er
Exams
ECTS Lecture
Excercise Individu
s al Work
Credits s
PLANNING METHODS VI 1 5 30 30 90
ORGANIZATION OF
V 1 6 30 30 120
CONSTRUCTION SITE
METHODOLOGY AND
MANAGEMENT IN V 1 2 15 15 30
CIVIL ENGINEERING
CONDUCT OF
COMPANY BUSINESS V 1 5 30 30 90
OPERATIONS
MARKET AND
BUSINESS IV 1 5 30 15 105
ENVIRONMENT
PROJECT
MANAGEMENT AND V 1 5 30 15 105
LEGISLATION

Table 2: Group of courses offered only in the Management in Civil Engineering

group of courses

After the completion of the Management in Civil Engineering group of courses

within the Professional Study Programme, the students will obtain knowledge, skills
and qualifications for all activities relating to construction management. They will
learn to participate in the design and development of technological processes
during construction of various structures, and to act independently in individual
phases of work and in finishing trades. They will also learn to independently make
price analysis and check compliance of completed work, prepare working design
documentation for site preparation and to organize operation of construction
machinery, installations, and equipment during the realization of construction work.

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3. Polytechnic Graduate Professional Study Programme in Civil

Engineering

In order to give the successful graduates of our first cycle Professional Study
Programme the opportunity to proceed with their studies, and to meet the economy
needs at the same time, we have decided to establish a second cycle Professional
Study Programme, a two-year specialist study programme for all students
(providing they fulfil the admission requirements). The study programme was
named Polytechnic Graduate Professional Study Programme, and among others
offered a Specialization in Civil Engineering. The study programme lasts 4
semesters, awarding 120 ECTS credits, and after the completion of their studies,
the students acquire the title of Master of Engineering in Civil Engineering

In addition to the traditional groups of courses, i.e. Building Construction and Civil
Engineering (Water and Transport Infrastructure) the Polytechnic of Zagreb has
decided to offer the students an additional orientation in the form of a group of
courses called Management in Civil Engineering. That group of courses corresponds
to courses taught during the first cycle Professional Study Programme at the
Polytechnic of Zagreb. New developments in technology and economy were the
propulsive force that stimulated and encouraged the Polytechnic of Zagreb to
organize the new study programmes, and hence to contribute to the development
of education through creation of novel areas and disciplines in high education. The
quality of our selection of educational programs is additionally confirmed by the fact
that many international and European institutions of high education have been
increasingly offering programmes such as Civil and Environmental Engineering and
Management in Civil Engineering.

Also in December 2008 the Republic of Croatia issued the Law on Architectural and
Engineering Activities and Works in Physical Planning and Construction, thus
forming a legal category of Building Construction Managers and recognizing the
need for Management in Civil Engineering.

The main objective of the second cycle study programme in the field of Civil
Engineering is to educate highly qualified civil engineering experts that will be able
to offer their services on the labour market in a fully independent manner, and
whose profile is optimally suited to the needs of the present day construction
industry. The courses of this study programme are primarily oriented toward
acquiring expert knowledge and skills with an optimally balanced proportion of
modern theoretical background, so that the students can directly be included in
work processes that are related to civil engineering. Upon completion of their
studies, students are prepared for independent realization of projects, as in the
course of their studies they have acquired highly specialized skills and knowledge of
management in construction projects, as well as the knowledge and skills related to
construction technologies, site organization, quality control and quality assurance,
control of expenditures, construction regulations, etc.

The Polytechnic Graduate Professional Study Programme is organized for the

Bachelors of Engineering and for Bachelors of Science with some field work or with
working experience. The specialization in Civil Engineering offers the continuation of
the studies in form of four groups of courses, based mainly on the group of courses
selected during previous studies. After fulfilment of program requirements, our
students are fully qualified for independent work in construction practice, design
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offices, a variety of administrative and municipal services, and in all other branches
of industry and areas relating to their field of expertise (construction management).

Table 3 presents courses related to organization, management and technology on

the Polytechnic Graduate Professional Study Programme.

Numbe Hours
Hours of Hours of
Semest r of of
Course er
Exams
ECTS Lecture
Excercise Individu
s al Work
Credits s
CONSTRUCTION
PROJECT II 1 6 30 30 120
MANAGEMENT
MODERN
CONSTRUCTION II 1 7 30 30 150
TECHNOLOGIES
PROJECT PLANNING
III 1 6 30 30 120
AND MONITORING
CONSTRUCTION
III 1 5 30 15 105
REGULATIONS
INVESTMENT
III 1 6 30 30 120
POLICIES
LEGAL ASPECTS OF
CONSTRUCTION III 1 5 30 15 105
PROJECTS
BUSINESS
MANAGEMENT IN
III 1 5 30 15 105
CONSTRUCTION
INDUSTRY
MANAGEMENT AND
MAINTENANCE OF
INFRASTRUCTURE III 1 6 30 30 120
FACILITIES AND
BUILDINGS
GRADUATION THESIS IV 30 15 285 600

Table 3: Courses related to organization, management and technology and the

group of courses specialized for Management in Civil Engineering

4. Basic success indicators of the Management in Civil Engineering

group of courses on both study programmes

During the past five year period, between the years 2005 and 2009, five
generations of students have entered the Professional Study Programme, and four
generations of students have entered the Polytechnic Graduate Professional Study
Programme. A portion of the students in each of those generations took the
Management in Civil Engineering group of courses.

Between the years 2005 and 2009 a total number of 185 students chose the
Management in Civil Engineering group of courses in the fourth semester.

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It must be noted that in the first academic year in that period, i.e., 2005/06 there
were no students who could chose that or any other group of courses, because this
was the first academic year in which the Professional Study Programme was being
conducted and there were only students who were attending the first and second
semester. It must also be noted that there are four groups of courses and each
year 25% of the students ranked by their grades can choose the Management in
Civil Engineering group of courses. In the second academic year in that period, i.e.,
2006/07, a total number of 14 students chose the group of courses. In the year
2007/08 there were 51 students, in the year 2008/09 there were 50 students and
in the last year, i.e. 2009/10 there was a total number of 70 students who chose
the group of courses.

After the initial fluctuation in the number of students in the year 07/08 and in the
year 08/09 did not vary that much. The last increase in the number of students
between the years 08/09 and 09/10 happened because the ratios between the four
groups of courses changed and in the last year 33% of the students could choose
the Management in Civil Engineering group of courses. The change in the ratios
happened because the surveys conducted at the National Employment Office said
that all of the students that chose and finished the Management in Civil Engineering
group of courses on the Professional Study Programme were employed almost
instantly after graduation. The first students finished the Professional Study
Programme and the Management in Civil Engineering group of courses in the
academic year 2007/08 (16 students), in the next academic year 2008/09 a total
number of 29 students finished and it is estimated that in the last academic year,
i.e., 2009/10 there will be 35 students that will finish the programme and the group
of courses. The students finished with an average grade of 3.645.

Between the years 2006 and 2009 a total number of 145 students were admitted to
the Polytechnic Graduate Professional Study Programme in Civil Engineering who
chose the Management in Civil Engineering group of courses. The number of
students that were admitted to the study programme and who chose the group of
courses in each academic year was 45 in the year 2006/07, 40 in the year 2007/08,
and 30 in both 2008/09 and 2009/10.

The Polytechnic Graduate Professional Study Programme is organized for the

Bachelors of Engineering and for the Bachelors of Science with some working
experience, and a majority of those students is employed while studying. Because
of that fact, the classes are organized in a slowed-down manner so that the each
semester actually lasts one year. For that reason there was a slight decrease in the
number of students that were admitted to the study programme in each academic
year from the year 06/07 to the year 09/10, and it happened due to the technical
issues regarding the conduction of classes, so that the high level of education
conduction could be maintained.

In the same period a total of 17 students who chose the Management in Civil
Engineering group of courses graduated the study programme with an average
grade of 3.786. Such a small number is to be explained with the fact that most of
the students are employed full time while studying.

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5. Survey on the student opinion among the students of the

Professional Study Programme

After the students finish every semester they are given a survey about their opinion
on education conduction and their general grades of the study as a whole. The
survey includes all of the students on the Professional Study Programme, so the
results given here are extracted for only the students who chose the Management
in Civil Engineering group of courses. The number of students being surveyed
varied from 34 to 41.

The students were asked a series of questions about the study in whole and a
series of questions about every course separately. From the survey we extracted
the following question which asked the students are they generally satisfied with
the education conduction and the general state of the study programme. The
students were given five different answers between which they could choose one.
Figure 1 shows their answers for each academic year separately.

Figure 1: Professional Study Programme

6. Survey on the student opinion among the students of the

Polytechnic Graduate Professional Study Programme

Like the survey among students on the Professional Study Programme, a survey is
conducted on the Polytechnic Graduate Professional Study Programme. Also the
results given here are extracted for only the students who chose the Management
in Civil Engineering group of courses. The number of students being surveyed
varied from 16 to 22.

These students were asked the same question as the students on the Professional
Study Programme. They were given five different answers between which they
could choose one. Figure 2 shows their answers for each academic year separately.

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Figure 2: Polytechnic Graduate Professional Study Programme

7. Conclusion

These new study programmes, harmonized with the Bologna Declaration, both the
Professional Study Programme and the Polytechnic Graduate Professional Study
Programme, have been started in the academic year 2005/06. During the last five
years the Management in Civil Engineering group of courses on the Professional
Study Programme and on the Polytechnic Graduate Professional Study Programme,
has been established among students as the most popular group of courses. It has
achieved that status with the high quality of study programmes, up to date course
content, the fact that many professors are experts in their field of work, and that
they are transferring their practical professional knowledge to the students.

The specific slowed down manner of studying on the Polytechnic Graduate

Professional Study Programme is especially suitable for the students that finished
the Professional Study Programme and are employed full time, so it allows them to
upgrade their knowledge acquired through their field work experience.

Both the Professional Study Programme and the Polytechnic Graduate Professional
Study Programme, especially the Management in Civil Engineering group of
courses, have been recognized by the construction business environment also, and
the fact is that at this time there are almost no unemployed students who finished
the two fore mentioned study programmes.

It must also be mentioned that the Republic of Croatia recognized the knowledge
and skills of our students and through the changes made in the legislation gave our
students all of the necessary authorizations, which made them equal with all of the
students finishing the University Study Programmes.

This model of studying can be applied in other countries which have the similar
situation of having a large number of Bachelors of Engineering and Bachelors of
Science with some field work or with working experience who want to continue the
studies and enhance their existing knowledge in the project management field.

It is our hope that all these positive trends will continue, and that this system of
lifelong education of already graduated Bachelors of Civil Engineering is a good
assurance for the future.

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8. References

Polytechnic of Zagreb: Study programme proposal – Civil Engineering, Zagreb, May

2005
Polytechnic of Zagreb: Study programme proposal – Polytechnic graduate
professional study programme, Zagreb, March 2005
Polytechnic of Zagreb: Standard student survey
“Croatian Law on Physical Planning and Construction”, NN No.76, 23.7.07.
“Croatian Law on Architectural and Engineering Activities and Works in Physical
Planning and Construction”, NN No.152, 18.12.08.

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AA093

Generation of Rework: An Organisation’s Perspective

Sepideh Edrisi
(Graduate Student, The British University in Dubai, Dubai, UAE)

Arun Bajracharya
(Lecturer, The British University in Dubai, Dubai, UAE)

Abstract
Rework can be taken as undesirable outcome in projects. Organisations use
different approaches to respond and deal with rework during execution of projects.
Some of the organisations might be well-prepared to deal with it as a part of
project, whereas, others might be ignorant about it. In fact, the complexity of
rework often deludes organisations which are even prepared to handle it.
Understanding of the physics of rework is crucial but it needs to be first understood
how organisations perceive and tackle it in real life.

This paper intends to present the rework and its source that is understood at the
ground level by project team members in an organisation which works with power
system projects in the United Arab Emirates. A qualitative approach has been used
to explore the understanding of rework in the organization. Semi-structured
interviews were taken with the project team members who deal with rework
practically and are interested to find proper solutions to mitigate it. The interview
data were processed and assembled in terms of a theoretical framework that
represents their interpretation of rework. It was found that “failure in quality” and
“change from the side of customer” are the two primary sources that are
responsible for generating rework in the projects. The understanding is practical but
its adequacy is definitely worthwhile to be further investigated.

Keywords
Rework, understanding of rework, power system projects, qualitative approach,
UAE.

1. Introduction

Rework is a set of by-product in project that is essentially undesirable. From

customer-focused point of view, rework can be taken as something that has to be
worked upon again in project, at least for one extra time due to non-conformance
to requirements (Love et al., 1999). From process centric view, rework could be
defined as the unnecessary effort of re-doing a process that was incorrectly
implemented in the first time (Love et al., 2000). From the systems point of view,
rework is a form of waste and is a non-value adding activity that add costs directly
or indirectly (Love et al. 1999). However it is clearly a set of post-event corrective
activity in projects and some authors view it as almost inevitable and acceptable,
and define it as “making occasional mistakes” (Sommerville, 2007). At the same
time, the costs of rework have been reported to be significant, for example, it
would range from 2% to 12% of contract value in construction projects (Burati et

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al., 1992; Josephson and Hammarlund, 1999; Love and Li, 2000). Moreover,
rework transpires over time necessitating more resource deployment, with possible
schedule slippage and reductions in project scope or quality (Love and Edwards,
2004). The adverse consequences of these difficulties include reduced profit, loss of
market share and reputation, increased turnover of management and workforce,
lower productivity, higher costs and too frequent costly litigation between
participants over responsibility for overruns and delays. (Ackermann et al., 1997
and Eden et al. 2000, cited in Love and Edwards, 2004). Probably because of these
consequences, organisations which are aware about the existence of rework in their
projects are always interested to trace the causes of rework and make attempt for
mitigation. This paper presents a set of rework related observation of project team
members in a UAE based organisation which works with power system (PS)
projects.

2. The Studied Organisation

This study looks into the projects in the PS division of the UAE based organisation.
The PS division was divided into different local business units (LBU). One of such
units was running turn-key projects that run high voltage substation projects as a
main contractor of the government public utility authorities. Another unit was
working as a sub-contractor for main contractors in running protection and
automation systems projects that included protection panels and substation, and
control and monitoring systems project. Usually the scope of work for the projects
were civil and electrical design, civil works, manufacturing/production, factory test,
installation, delivery, test and commissioning of all parts of a high voltage
substation. There were altogether 250 employees in the PS division.

According to the project financial controllers’ monthly reports which were based on
all running projects, there was a huge amount of costs of poor quality (COPQ)
which included direct and indirect costs of rework in projects and had considerable
effects on the projects’ margins. So, the project managers were highly interested in
identifying the sources of generation of rework and in finding the proper solutions
in order to minimize it.

The respondents for this study were selected among the project functional team
members and managers from the organisation. They were a supply chain manager,
a design manager, a manufacturing/ production manager, a project manager, a
project financial controller and an operation manager. The reason for selection of
these people was that they were dealing with rework problem practically in their
organization and are interested to find proper solutions to mitigate it. Semi-
structured interviews were taken with them to get their understanding about the
causes of rework in projects they have been handling.

3. Discussion and Analysis

Figure 1 shows the general path of project management activities in the PS division
project organization.

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Sub‐contractors / 
Suppliers

Design  Supply Chain  Test and 

(Civil / Electrical) Manufacturing Installation
Management Commissioning

Sales / 
Tendering

Project Management

Operation Management

Fig 1: General Path of Project Management Activities

The flow in projects generally starts from the sales/tendering stage. An official offer
as per the client’s technical specifications and contractual scope of work would be
prepared. For this task, the first challenge is scope management which is critical to
the success of an engineering design project. There is high probability of occurrence
of discrepancies between contractual documents (i.e. scope of work and technical
specifications) due to poor quality in customer documentations. So, proper scope
management could help to figure out these deviations and reduce a huge amount of
rework in project in later stages.

Also, poor communication with customer/consultant regarding their requirements

can add some problem which would appear as a change order and cause rework in
later stages. “I think the most important source of generation of rework in our
organization is the lack of proper scope management and close communication with
our clients at sales/tendering stage” – this was one of the observations of an
operation manager.

The next very important, time consuming and complex phase, especially in power
system projects, is the phase of design. Sometimes in order to prepare a simple
calculation especially for modification works, there should be lots of information to
be provided by the client and even by the end users along with the technical
experts. Because of this complexity in the involvement of lots of professionals, and
requirements of different software and IT supports, the probability of generation of
errors or mistakes is significantly high.

The situation would be worse if there is shortage of dedicated employees. Usually,

shortage occurs when there are lots of running projects at the same time, and
deployment of more resources may even lead to unintended side effects. On the
other hand, engineering productivity can be conveniently measured by work hours
which address the need for estimating, resource scheduling and workload
distribution in the design team. So, the next important cause of rework in design is
poor planning of resources and their workload.
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Moreover, the significant amounts of rework that emanate from the design phase
are due to lack of ability of design team. A design manager expressed that, “when
we hire a new engineer we cannot expect proper output from him/her at least for
three to six months, because they should be trained and certified for design and
work with products. But usually we do not have that much time due to high
workload and they should start to work within weeks. So, obviously organization
should expect more mistakes and errors in drawings”.

One of the primary outputs of design is bill of quantity (BOQ) which would be taken
care of by supply chain management (SCM) team through the project manager. It
is clear that if there are any errors on the quantity or specification of the given
BOQ, it would create rework for SCM and will add extra costs for project. A supply
chain manager explained: “......we have had a project in which we had to purchase
a complete set of 20KV switchgear. We ordered the first one based on agreed
drawings and technical specifications. But for the second one we assumed that
everything is the same, so in order to save time, we ordered the second set without
checking it with the design team. We did not consider that there were some
differences in dimensions of 20KV switchgear room. Then when we received the
panels, they were not matching with the cable wholes and room. It caused a huge
amount of rework for us. It happened only because of lack of double checking of
drawings with the design team.”

The next step is manufacturing. When all equipment have been purchased and
delivered to the factory, there is another requirement for starting the
manufacturing activity which is manufacturing drawings (i.e. the second output
from engineering). This step is really significant and critical in terms of generation
of rework because usually there are some errors in drawings which can repeat in
the manufacturing of panels for example. A manufacturing manager mentioned
that, “there should be a close communication and coordination among SCM, design,
and project manager and manufacturing team in order to minimize the rework”.
Even, the operation manager approved that “definitely poor communication and
coordination in manufacturing stage will cause lots of rework and consequently
would affect the project cost and time”.

The two last stages after delivery of equipment to sites are installation and test and
commissioning which have lots of valid reasons to generate the rework. A project
manager expressed that, “we have to repeat our test and commissioning job at site
because of poor planning, coordination and shortage of dedicated resources. The
most effective cause can be reallocation of resources and sending them to other
sites before finishing their current job,......sometimes unrealistic client demands for
earlier completion of projects were a major contributing factor”.

A number of poor management practices contributed to the generation of rework

and waste in projects. Ineffective use of IT also led to inappropriate and non-timely
information transfer between design team members and consequently imposed
significant restrictions. The design manager, operation manager and project
manager all agreed that ineffective IT system and some managerial problems such
as ineffective decision making, lack of proper job separations with defined and
agreed job descriptions and roles and responsibilities would increase the probability
of occurrence of rework.

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4. Findings

Based on the collected data from interviews, it can be summarised that rework is
generated in the PS division from two major sources: changes and failure in quality.

Usually, the critical changes are external ones due to change orders or variation
orders from customer. Lack of experience and knowledge, poor communication with
design consultant and poor contract documentation and technical specifications
would be the major causes for that.

The second identified cause (i.e. failure in quality), could be attributed to the
generated errors and the lack of customer focus approach. Lack of customer focus
approach can occur because of ineffective scope management in sales/tendering.

Errors also generate because of poor skills and organisation problems. Poor skills in
design team would result in drawings with lots of mistakes and unapproved or
rejected stamps on them. Moreover, the project team comes up with inadequate
project planning and scheduling, the manufacturing team delivers incorrect
assemblies and installations. In addition, the most critical part of poor skills is
related to managerial skills which include ineffective decision making, shortage of
dedicated resources (due to staff turnover, lack of hiring of dedicated people, lack
of proper trainings, poor planning of manpower and reallocation of resources
frequently before finishing their jobs).

Organizational problems mostly identified are the ineffective IT system and the
organizational structure. Since the organizational structure in the PS division is
matrix and functional, poor communications among different functional employees
could be a source for generation of rework.

Incorporating all the mentioned factors, a model depicting the generation of rework
in the PS division of the company is presented in Figure 2.

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Lack of Experience 
and Knowledge
Poor 
CHANGES FROM 
Communication with 
CUSTOMER
Design Consultant Breakdown in 
Poor Contract  Organisational Functional  communication and 
Documentation and  structure structure coordination between 
Technical  functions
Organisational
Specifications
problems

Ineffective IT

Reallocation of 
Poor project 
REWORK resources to 
planning
other projects
Poor design
Staff turnover
Poor 
Errors installation Lack of hiring 
dedicated people
Shortage of 
dedicated  Poor human 
Poor skills employees resource 
FAILURE IN  planning
QUALITY Managerial 
problems Lack of proper 
training
Ineffective 
Lack of Customer  Poor scope  decision 
Focus management makings

Fig 2: Generation of Rework

5. Conclusions

In conclusion, it appears that the cause of rework is relatively straightforward and

that can be broadly divided into two categories – change from the side of the
customer, and failure in quality. The causes were derived from the interview data
that is the interpretive understanding of the managers in the company. In fact, the
managers were struggling to reduce the amount of rework, and this research has
made an attempt to capture their mental model. Their interpretations have been
assembled and presented as a cause-and-effect model. However, a closer
examination into the rework events reveal that an intricately “complex” and
interwoven array of factors contribute to their occurrence. In fact, it was very
difficult to identify some specific causes for rework because of the interdependency
of work arrangements and dynamic interactions between project participants.
Therefore, the attempt of this paper can be taken as a stepping stone to
understand the dynamics of rework in projects – which will be a part of further
research in this line.

6. References

Ackermann F., Eden C., Williams T. (1997), “Modelling litigation: Mixing qualitative
and quantitative approaches”, Interfaces, 27(2), 48–65.

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Burati Jr., J. L., Farrington, J. J. and Bedbetter, W. B. (1992), “Causes of quality

deviations in design and construction”, Journal of Construction Engineering and
Management, ASCE, 118(1), 34-49.
Eden C., Williams T., Howick S. (2000), “The role of feedback dynamics in
disruption and delay on the nature of disruption and delay (D&D) in major
projects”, Journal of the Operational Research Society, 51(3), 291–300.
Josephson, P. E. and Hammarlund, Y. (1999), "The causes and costs of defects in
construction: A study of seven building projects", Automation in Construction,
8(6), 681-687.
Love, P. E. D., Li, H. and Mandal, P. (1999), “Rework: A symptom of a
dysfunctional supply-chain”, European Journal of Purchasing and Supply
Management, 5(1), 1-11.
Love, P. E. D., Mandal, P., Smith, J. and Li, H. (2000), "Modelling the dynamics of
design error induced rework in construction", Construction Management and
Economics, 18(5), 575-586.
Love, P. E. D. and Li, H. (2000), "Quantifying the causes and costs of rework in
construction", Construction Management and Economics, 18(4), 479-490.
Love, P. E. D. and Edwards, D. J. (2004), "Forensic project management: the
underlying causes of rework in construction projects", Civil Engineering and
Environmental Systems, 21(3), 207-228.
Sommerville, J. (2007), “Defects and rework in new build: An analysis of the
phenomenon and drivers”, Structural Survey, 25(5), 391-407.

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AA010
A computer-aided conceptual cost estimating system for
prestressed concrete road bridges

Nikolaos Fragkakis
(Ph.D. Candidate, Centre for Construction Innovation, National Technical University
of Athens, Athens, Greece)

Sergios Lambropoulos
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
The need for an environmentally friendly design of modern motorways increases
the construction of bridges, which has exhibited substantial overruns above
estimated costs. Therefore, easy to use, inexpensive and accurate methods for
conceptual cost estimating are needed. Conceptual cost estimates are made before
the project’s detailed plans and specifications are known and rely on the conceptual
design of the project. Even though they present the lowest expected accuracy, they
are used by all the key people involved in the construction process.

This paper presents a computer-aided cost estimating system for prestressed

concrete road bridges, which provides estimates of the material quantities and cost
of all bridge elements. It relies on a database incorporating actual data collected
from recently constructed bridges and exploits material estimating models already
developed for bridge superstructure and foundations. The respective models for
bridge piers are presented in this paper.

Different configurations are devised from short to long-span bridges, accounting for
the major deck construction methods and foundation systems. The system can be
easily used to provide different cost estimates to the owner, designer and
contractor during the project’s early stages, since all the required input data
consists of basic design parameters that are known during the preliminary study of
each particular bridge. By allowing reliable cost estimates in a short time, the
proposed computer-aided system represents a useful decision making tool.

Keywords
Construction cost, Bridges, Estimation.

1. Introduction

Preliminary cost estimates are prepared before the completion of the project’s
design and are based on the conceptual design of the project at the stage when
only its basic technologies are known (Hendrickson 1998). Early cost estimates for
engineering projects are extremely important to all the major parties involved in
the construction process, such as the projects’ owners, designers, contractors and
sponsoring organizations. They are vital for business unit decisions involving
determination of the project’s feasibility and commercial viability, potential project

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screening through the comparison and financial evaluation of alternative projects,

establishment of initial budgets and asset allocation. Even though conceptual cost
estimates present the lowest expected accuracy, due to the limited available
information, inaccurate cost estimates may lead to lost opportunities, wasted
development effort and lower than expected returns (Oberlender and Trost 2001).

Bridge construction has substantially increased over the last decade. The need to
improve transport infrastructure in order to facilitate the mobility of persons and
goods, improve the territorial cohesion of the European Union, thus increasing
competitiveness and employment, has been identified as a major goal by the
European Commission. In the same time, rising ecological awareness requires an
environmentally friendly design for motorways that overcome difficult geological
terrains and by-pass city centres and archaeological sites. Since bridge construction
has traditionally exhibited substantial overruns above estimated costs (Skamris and
Flyvbjerg 1997), easy to use, inexpensive and reasonably accurate methods for
preliminary cost estimating are necessary.

This paper addresses the need for reliable cost estimates for concrete road bridges
during the early stages of the project and presents a computer-aided cost
estimating system that relies on information known before the detailed plans and
specifications are identified. The system uses material estimating models developed
with regression analysis on actual data collected from recently constructed bridges
and provides estimates of the material quantities and cost of all bridge elements.

2. Previous relevant cost studies and research

Cost estimating systems for motorway bridges are very limited, due to the difficulty
of acquiring actual cost and structural information for completed projects. Most
research efforts address the lack of actual data with computer-intensive theoretical
resolutions that optimize the final design through a trial and error process. They
concentrate mostly on the bridge superstructure and optimize its design conforming
to specific specifications and using standard shapes and cross sections.

Aparicio et al. (1996) proposed a computer-aided design system for prestressed

concrete highway bridges. The software starts from few geometrical data and
provides the geometry of all bridge elements taking into account specific live load
models, material properties and safety factors, as well as serviceability and
resistance requirements. A review of expert systems pertaining to conceptual
bridge design was presented by Miles and Moore (1991).

Several research studies address the design optimization of prestressed concrete

road bridges’ superstructures. Efforts by Sirca and Adeli (2005), Cohn and Lounis
(1995) and Lounis and Cohn (1993) rely on theoretical resolutions in order to
minimize the construction cost of the bridge superstructure. Sarma and Adeli
(1998) presented a review of articles addressing cost optimization of concrete
bridges.

On the other hand, Menn (1990) collected actual data from a sample of 19
motorway bridges built in Switzerland between 1958 and 1985. He developed a
breakdown of the bridge construction cost into mobilization, accessories,
substructure and superstructure and calculated the average values. Menn also
presented material estimating models for bridge superstructures, which, combined
with the proposed total cost breakdown, can lead to cost estimates for the bridge.
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Based on a sample of 119 concrete bridges and overpasses constructed in Greece

between 1999 and 2003 as part of the Egnatia Motorway, Fragkakis and
Lambropoulos (2004) presented a breakdown of the actual bridge construction cost
into earthworks, foundation, substructure, superstructure and accessories and
proposed the average cost values for four major deck construction methods.

Cost estimates derived from theoretical design optimization models do not express
actual construction and design experience and fail to address the changes that
occur during the project’s construction. These changes can absorb a significant
amount of the available capital, thus leading to substantial cost overruns, especially
for long-span bridges crossing difficult ground morphologies. To overcome this
problem, it is crucial for the decision makers to have an early estimate of the final
cost based on previous experience.

3. Concrete bridges of the Egnatia Motorway

Egnatia Motorway, a 680 km-long modern motorway, constitutes part of the Trans-
European Network for Transport. Its bridges were mostly constructed between
1996 and 2008. The largest overall bridge length exceeds 1000 m. and the largest
single span reaches 235 m. The design of bridges was conducted by Greek or
international structural design offices according to the German DIN standards.
Concerning the earthquake loading, the Greek Seismic Regulation for Design of
Bridges (E39/99) combined with the Greek Standard for Design of Earthquake
Resistant Structures (EAK 2000) was utilized.

4. Proposed method for pre-design cost estimates

The proposed computer-aided cost estimating system for prestressed concrete road
bridges involves two stages: the estimation of the material quantities of all major
bridge elements and the calculation of the relevant construction costs. The first
stage is based on material estimating models derived from the statistical analysis of
the collected actual data. The second stage derives the construction costs by
multiplying the estimated quantities with the unit prices for materials. The system
also uses the average cost values proposed by Fragkakis and Lambropoulos (2004).

4.1 Material estimating models

4.1.1 Bridge foundation and superstructure

The proposed cost estimating system uses different material estimating models for
the superstructure, the piers and the foundations. Concerning the bridge
foundation, the material estimating models and the rule-based expert system for
the selection of the foundation type presented by Fragkakis et al. (2009) are used.
The material estimating models for the superstructure proposed by Fragkakis and
Lambropoulos as part of an ongoing research are also embedded in the cost
estimating system.

4.1.2 Bridge piers

The design of a bridge pier is generally affected by the seismic design parameters,
the pier height (h), the length of the deck supported by the piers (ls) and the deck
width (b). Since the majority of the construction projects (85 % of the data
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sample) has been designed with similar seismic parameters, the authors decided to
exclude this parameter from the analysis and consider only the aforementioned
three independent variables. The length of the deck supported by each pier was
calculated as the average of the length of the two spans adjacent to the pier. The
volume of concrete (Vc) and the weight of reinforcing steel (Bs) represent the two
dependent variables.

A linear model was considered for regression modeling in this study. The analysis
approach includes a statistical hypothesis test to determine the significance of each
independent variable coupled with the check of the rationality of the cause and
effect relationships and the theoretical accuracy of the regression coefficients.

The database includes complete data for 322 bridge piers. The Pearson product-
moment correlation coefficients for the independent variables, as well as the
variance inflation factors and the tolerance, are given in Table 1. They reveal that
even though the length of the deck presents correlation with the height of the pier,
the variance inflation factor does not indicate a problem due to multicollinearity.

b ls h Tolerance VIF
b 1.000 0.859 1.164
ls -0.045 1.000 0.590 1.694
h -0.214 0.582 1.000 0.619 1.617

Table 1. Correlation coefficients, tolerance and Variance Inflation factor for piers.

The correlation coefficients also indicated that the deck width presents a minor
impact on the material quantities for both cases. As a result, in order to simplify the
regression analysis, the adjusted length of deck was defined as following:
 b 
l sadj  l s   
 bmed 
(1)
where lsadj is the adjusted length of deck, ls is the length of deck supported by the
piers, b is the deck width and bmed the median value of the deck width that equals
13.00 m. The examined regression model was in the following form:
Y  a   0  h  1  l sadj
(2)
where Y represents the dependent variable (Vc, Bs ).

Regression statistics, including the adjusted coefficient of determination (R2), the

significance and value of the F-test and the p-values for the independent variables
are presented in Table 2. They highlight the goodness of fit and the statistical
significance of both the regression model and the independent variables at a 1 %
significance level. The following equations provide predesign material estimates for
the volume of concrete and the weight of reinforcing steel for piers of concrete
bridges:
Vc  119.038  9.779  h  2.611  l sadj
(3)
Bs  39706.679  1863.910  h  880.240  l sadj
(4)

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The above material estimating models are valid for values of pier height between
9.18 m. and 87.83 m. and adjusted length of deck between 26.00 m. and 220.40
m.

Vc Bs
lsadj 1.7E-19 2.7E-57
h 4.8E-46 2.1E-56
R2 0.723 0.849
F-Value 419.540 903.411
F-Significance 4.9E-90 4.1E-132

Table 2. P-values, R2 and values for F-test for bridge piers

The R2 values range from 72 % to 85 %, indicating that the proposed models

provide a satisfactory fit to the data. The estimated p and F values also verify that
the independent variables and the selected regression models are statistically
significant, while the regression coefficients present theoretical correctness.

The correct application of the linear regression methodology requires the error term
of the model to be normally distributed, have a mean value of zero and a constant
variance (Gujarati 1999). The pattern of the residual plots indicated the sufficiency
of the regression models. The assumption of normality was also tested with the use
of the Shapiro-Wilks test (Analyse-it Software Ltd. 2009). The p-values were
calculated for each sample of residuals and verified the normality assumption of the
error terms at a 5 % level of significance. Furthermore, the mean value of the
residuals approached the value of zero.

Despite the presence of heteroscedasticity in both samples indicated by White’s test

(White 1980), the ordinary least squares estimators remain unbiased, consistent
and linear (Gujarati 1999) and the computed regression coefficients retain their
validity. On the other hand, the estimates of the variances are biased, thus
invalidating the tests of significance. White’s corrected standard errors were chosen
to adjust for heteroskedasticity. The “HC3” corrected standard errors according to
Long and Ervin’s (2000) recommendation and the relevant p-values were calculated
for both cases and verified the statistical significance of the independent variables.

5. Proposed cost estimating system

5.1 System characteristics and assumptions

The proposed system offers the following alternatives for deck superstructures and
construction methods:
 precast prestressed simply-supported concrete beams placed by launching
beam or crane and composite reinforced concrete slab;
 single and multispan cast-in-situ box girders;
 box girders with variable cross section depth constructed with the cast-in-
situ balanced cantilever method.

The system uses reinforced concrete piers and offers the following alternatives for
pier foundations:
 Shallow reinforced concrete spread footings;

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 Deep foundations consisting of cast-in-situ piles connected with a reinforced

concrete pile cap;
 Deep foundation consisting of reinforced concrete sockets.

5.2 Data input

The user has to enter the following data for each bridge:
 General information, such as name, id, location, highway, section and
kilometer position;
 Basic design data, such as length, width and number of spans;
 Length of each span and deck construction method;
 Height for each pier;
 Specific foundation type for each pier or provide the ground type and reply to
selection criteria in order to use the automated rule-based expert system for
the selection of the foundation type;
 Unit prices for materials.

All the required input data consists of basic parameters that are known during the
pre-design stages of the project. Based on contour maps and the alignment and
specifications of the motorway under evaluation, the user calculates the length and
width of the bridge and the length of the spans.

5.3 Results

The system produces the following results:

 Material quantities for the bridge deck, the piers and their foundations, both
individually for each element and cumulatively, and relevant parametric
ranges.
 Cost estimates for the bridge foundations, substructure, superstructure and
accessories and relevant parametric ranges.

5.4 Case example

The case example involves a prestressed concrete motorway bridge with a total
length of 200.00 m., 5 spans of equal length and deck width 13.00 m. The bridge
deck includes precast prestressed simply-supported concrete beams placed by
launching beam and composite reinforced concrete slab. Data input involves three
stages:
 The user first enters the general information for the bridge.
 He is then directed to complete the length and construction method for each
span.
 The final stage requires information for each pier. The user enters the pier
height and can either designate the foundation system or define the ground
type and reply to selection criteria in order to use the automated rule-based
expert system for the selection of the foundation system.

Figure 1 displays the data for the piers of the case example. For example, pier 1
has a height of 12.58 m. and ground type categorized as IB1. Since its foundation
lies in a steep slope, the system automatically proposes the use of socket
foundation. For pier 3, the existence of the river bed leads to the use of piles.

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After completing the data input, the system displays the material quantities
cumulatively for each foundation type, the substructure and the superstructure of
the bridge as presented in figure 2. The user can also examine the material
quantities for each bridge element separately and the relevant parametric ranges.

The system also produces cost estimates for the bridge and prompts the user to
enter the unit prices for the materials. It displays the breakdown of the total cost in
foundations, substructure, superstructure and accessories and offers the option to
present the cost estimates analytically for each element and the parametric ranges.

6. Conclusions

The proposed computer-aided cost estimating system allows in a short time reliable
conceptual cost estimates for prestressed concrete road bridges. It offers
alternatives for major foundation types, deck types and construction methods and
can be easily used during the early stages of the project. The system represents a
useful decision making tool for the project’s design engineer, owner and contractor
by allowing easy comparative studies from both technical and economical
viewpoints among different alternatives.

7. References

Analyse-it Software Ltd. (2009), “Analyse-it for Microsoft Excel” (version 2.12).
Aparicio, A.C., Casas, J.R. and Ramos, G. (1996), “Computer aided design of
prestressed concrete highway bridges”, Computers & Structures, 60 (6), 957-
969.
Cohn, M.Z. and Lounis, Z. (1995), “Optimal design of structural concrete bridge
systems”, Journal of Structural Engineering, 120(9), 2653-2674.
Fragkakis, N.P. and Lambropoulos, S. (2004), “A quantity and cost estimate model
for concrete road bridges”, Tech. Chron. Science Journal, TCG, I 24 (2-3), 65-
78.
Fragkakis, N.P., Lambropoulos, S. and Tsiambaos, G. (2009), “A parametric model
for conceptual cost estimation of concrete bridge foundations”, Journal of
Infrastructure Systems (accepted for publication).
Gujarati, D. (1999), “Essentials of Econometrics”, Irwin Mc Graw Hill, New York.
Hendrickson, C. (1998), “Project Management for Construction, Fundamental
Concepts for Owners, Engineers, Architects and Builders” (version 2.2).
(http://pmbook.ce.cmu.edu/05_Cost_Estimation.html) (March 20, 2008).
Long, J. S. and Ervin, L H. (2000), “Using heteroscedasticity consistent standard
errors in the linear regression model”, The American Statistician, 54, 217-224.
Lounis, Z. and Cohn, M.Z. (1993), “Optimization of precast prestressed concrete
bridge girder systems”, PCI Journal, 38(4), 60-78.
Menn, C. (1990), “Prestressed concrete bridges”, Birkhauser, Germany.
Miles, J.C. and Moore, C.J. (1991), “An expert system for the conceptual design of
bridges”, Computers & Structures, 40(1), 101-105.
Oberlender, G.D. and Trost, S.M. (2001), “Predicting accuracy of early cost
estimates based on estimate quality”, Journal of Construction Engineering and
Management, 127(3), 173-182.
Sarma, K.C. and Adeli, H. (1998), “Cost optimization of concrete structures”,
Journal of Structural Engineering, 124(5), 570-579.

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Sirca, G.F. and Adeli, H. (2005), “Cost optimization of prestressed concrete

bridges”, Journal of Structural Engineering, 131(3), 380-388.
Skamris, M.K. and Flyvbjerg, B. (1997), “Inaccuracy of traffic forecasts and cost
estimates on large transport projects”, Transport Policy, 4(3), 141-146.
White, H. (1980), “A heteroskedasticity-consistent covariance matrix and a direct
test for heteroskedasticity”, Econometrica, 48, 817-838.

Fig 1: Data input for the piers of case example

Fig 2: Material quantities of case example

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AA074

Implementation Of The Entropy Concept on Construction Projects

Under Financial Constraints

Konstantinos A. Galaras
(Civil Engineer MSc, Thessaloniki, Greece)

Dr. Symeon Christodoulou

(Associate Professor, University of Cyprus, Department of Civil and Environmental
Engineering, Nicosia, Cyprus)

Evangelos S. Tezias
(Civil Engineer MSc, Thessaloniki, Greece)

Abstract
The paper investigates the relationship between entropy (disorder) and financially-
constrained projects, through a case-study project (a highway project in Cyprus).
The work builds on previous and ongoing research at the University of Cyprus and
at the Democritus University of Thrace. A number of mathematical models
describing the aforementioned relationship are developed, with an emphasis on the
effect of financial disorder on the progress of a project. The purpose of this
endeavour is to optimize the allocation of the monetary resources to the project
activities in such manner that will produce a lower measure of financial entropy and
a higher profit. Modelling and evaluation of the proposed method is performed by
use of commercially available software. The entropy-based approach results in an
optimal solution that satisfies the initially stated purpose of simultaneously reducing
the level of entropy and increasing the profitability of the project.

Keywords
Unbalanced bidding, Entropy, Resource - constrained scheduling

1. Introduction

The increase in the number, size and complexity of construction projects has
stimulated heightened interest in construction technology and management
techniques for the proper development of construction projects. Consequently,
construction companies are in a continuous endeavor to deal with the problems that
arise due to the lack of organisation and coordination. Therefore, the invention of
innovative solutions that will contribute to the optimization of projects and the
improvement in their management, the observance of time schedules, the
improvement of cashflow and the achievement of high standard production are
really important.

The main problem during the construction of a project appears to be the constraint
in available resources (human, equipment, financial, etc.). Particularly, indicative
problems that may arise in a project under financial constraints are the delay in
payments, insufficient financing, negative cashflow and a difficulty in the allocation
of monetary resources to all the activities scheduled. The above can create
consecutive difficulties and affect the total progress of works. It is for this reason,
among others, that project schedules need to include not only time assignments
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(activity durations) but also resource assignments (including cost) for all project
activities, including the corresponding resource constraints.

Generally, resource-constrained scheduling problems (RCSP) give rise to many

related difficulties, that increase significantly with the increase of the number in a
project’s activities. Several methologies for solving RCSP have been developed to-
date. Most of them use a combination of implicit enumeration [Brucker and Knust
(2003), Mingozzi et al. (1998), Crawford (1996), Garey et al. (1976)] and heuristic
techniques [Brucker et al. (1998), Primavera Systems (2001), Microsoft
Corporation (2000)], intelligent branching and evaluation techniques such as
mathematical programming, dynamic programming (Carruthers and Battersby,
1966), zero-one programming (Patterson, 1984), artificial agent techniques such as
genetic algorithms (Hegazy, 1999) and ACO algorithms [Christodoulou (2005),
Christodoulou (2007)].

The aim of this paper is to provide an optimization method for the allocation of
monetary resources to each activity in order to reduce the disorder and the possible
risk that exists during planning and constructing, and to increase the profitability of
a project by use of an alternative method. The utilized method makes use of the
entropy concept, for which the term of Monetary Entropy (HM) is introduced, in
conjunction with the unbalanced bid method in order to meet the aforementioned
goal. The method builds on work by Christodoulou et al. (2008a,b; 2009a,b,c). An
entropy reduction of at least 5% with a related minimum increase in net present
value (NPV) of at least 1% is also set as a goal (maximize NPV ∩ Limit Entropy).

1.1 Monetary entropy

Entropy Hx is considered to be a metric of a system’s order and stability and has

been applied in recent years to a wide range of sciences. It can be mathematically
evaluated as the product of the probability distribution (px) of a variable x, times
the natural logarithm of the inverse of that probability distribution:

ΗΧ = pΧ *ln (1/pΧ) ή ΗΧ = -pΧ*ln(pΧ)

(1)

The definition of the entropy metric in the field of construction management is

derived from its classical formula, and the monetary entropy HMx,r can be defined
and calculated through the following equation:

HMx,r = pr *ln (1/pr)

(2)

where pr is the bid markup of an activity (=1.0 + profit percentage). The higher the
value of entropy is, the more chaotic an activity is expected to be. The produced
system disorder may be described as:
 Negative project cashflow that can lead to delay in payments affecting the
time schedule, the quality and the productivity of the project or its self-
financing
 Uncertainty for the estimated bare cost of the activities (it can be increased
due to external factors such as material reevaluation, equipment failure)
 Difficulty in administrating big amounts of money and assigning them to each
activity properly

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 Reduced possibilities for a contractor to undertake the project because of the

deviation from the implementation of classical methods (balanced bid etc.)

1.2 Unbalanced Bid Method

In their effort to reduce the negative consequences of delay in payments, self-

financing and financial constraints, construction companies often apply the
unbalanced bid method in order to secure a positive cashflow. In fact, bid-
unbalancing can be thought of as a means to maximize the NPV of the project
payments by varying the bid prices of the individual bid items (within acceptable
limits). According to its classical definition, bid-unbalancing is a process by which
the overall project actual cost and the project profit are intelligently distributed
among the project without affecting its total bid price. The method of unbalanced
bid can be explained by the following equation:

Max{NPVP=∑[(Vx)(P/F, i%, t)]} (3)

with NPVP being the net present value of the project; Vx the value (actual cost plus
overhead and profit) of activity x; (P/F, i%, t) the single payment factor for the
present value (P) of a future payment (F) made at time t, assuming an interest rate
i%.

1.3 Monetary Entropy-based Bid-unbalancing

A project planner should not only examine the financial assignments that maximize
the activity or the project profitability but also the assignments that minimize the
system’s tendency to fall into disorder.Therefore, a revision of the bid-unbalancing
problem in terms of entropy would be the examination of the percentage of the
overall bid amount that should be assigned to an activity so as to maximize the
project’s NPV while minimizing the project’s monetary entropy (subject to a
specified financial limitation). Thus, the optimization given by the equation (3) can
be formed as followed:

Min{ HMx,r = ∑(HMx,r) =∑[px,r ln (1/px,r)]=} (4.1)

Max{ NPVP = ∑ [(Vx)(P/F, i%, t)]} (4.2)

subject to: ∑ (Vx) ≤ ΒP & Vx, ΒP > 0 (4.3)

a.rp ≤ bx ≤ β. rp (4.4)
HMx,r ≥ 0 (4.5)

with HMx,r being the monetary entropy of activity x caused by a bid markup of value
r; NPVP being the net present value of the project; Vx the value (actual cost plus
overhead and profit) of activity x; (P/F, i%, t) the single payment factor for the
present value (P) of a future payment (F) made at time t, assuming an interest rate
i%; rp and rx the project and activity markup respectively; Bp the total bid price for
the project; a.rp and β. rp the lower and upper limits from which an activity markup
can be selected with respect to the total bid markup.

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2. Methodology

The methodology presented in this paper combines the concept of monetary

entropy with the unbalanced bid method, in a single-criterion methodology under
constraints and includes the following steps:

 Develop and solve the project network (Critical Path Method), calculating the
early start/finish and late start/finish dates of every project activity (in
Primavera Project Planner or Microsoft Excel)
 Evaluate the cost for each activity (Cx) and the total bare cost of the project
(Cp),
 Introduce the balanced-bid project markup (rp) as the ratio of bid price (Bp)
over total bare cost (CP),
 Define the economical parameters of the project: The total bid price (Bp) and
the financing interest rate (i%)
 Establish the upper and lower limits in which the activity markup can range
(this should be based on the constraint that the combined effects of the
unbalanced-bid activity markup must not exceed the original project bid
price, Bp),
 Assume a probability distribution for the assigned activity bid mark-ups.
Typically, this can be a normal distribution with mean equal to the balanced-
bid project markup (eg. 1.20, assuming a 20% profit) and a related standard
deviation (eg. equal to 10% of the mean),
 State the monetary entropy equations (HMx,r) for each activity x (in Microsoft
Excel)
 Use commercially available simulation software (Crystal Ball, Crystal Ball’s
Optquest) to simulate the behavior of the network under resource and
entropy constraints to obtain the following results:
 the resulting activity monetary values (Vx = rx*Cx)
 the probability value for the examined activity bid markup
 the activity monetary entropy (HMx,r)
 the project monetary entropy (HM)
 the project cashflow and the N.P.V (Net Present Value) in different
time periods
 Identify the simulation with the lower total monetary entropy of the project
along with the combination of activity bid markups that produce the lower
entropy. Furthermore, identify the combination that produces the maximum
NPV and the desirable conjunction of both reduced entropy metric and
increased NPV.

Primavera Project Planner (P3) and Crystal Ball (v7.2) are both commercially
available softwares. P3 addresses resource-constrained scheduling by means of
resource leveling and schedules an activity only when the activity’s resource
demands can be met. Crystal Ball is a forecasting and risk analysis software which
works in the MS Excel environment processing data with connected relationships
through a simulation process. Solution of the aforementioned entropy optimization
problem required the execution of a large number of simulations (using different
parameters each time).

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2.1 Notes and Assumptions

The assumptions used in this paper consider mainly economic parameters. The
parameters considered are:
 The contractor’s profit is designated to 20%. Of course it will undergo
changes through the implementation of the unbalanced bid method.
Therefore, the initial bid markup will be equal to 1.20.
 The standard deviation during the simulations (normal, triangular
distribution) is 0.12.
 The interest rate is i=12% and it is assumed that the contractor will get paid
at the end of each month
 Every activity is paid one month after its completion
 In the monetary entropy equation (1) px defines the bid markup which is the
price of actual cost plus the profit divided with the actual cost.

3. Case Study

The project studied in this paper refers to the construction of 4km highway in
Cyrpus with 2+2 lanes. The project schedule consisted of 502 activities with a
minimum project duration of 335 working days. The total cost of the project runs
into 4.117.664€ which leads to a total bid price of 4.941.197€ (profit set at 20%).
Furthermore, the original-schedule NPV for the total bid price is 4.495.818€
(according to the aforementioned assumptions) and the project monetary entropy
equals HM=109.83.

The simulations executed, referred to the separate implementation of decision

variables, normal distribution and triangular distribution on the values of the bid
markup with different objective each time (maximum NPV or minimum HM).

3.1 Decision Variables

Initially, a number of 110,000 trials were executed in order to optimize the bid
markup value and to minimize the disorder produced during the project. The
objective as shown in Fig. 1 was to minimize the total project entropy whilst
satisfying the constraint of not exceeding the total bid price. The value of the
decision variable (bid markup) can range from 0.9 to 1.3. The minimum obtained
entropy is HM= 90.64 which is quite lower than the initial number (109.83). The
obtained NPV for the particular simulation is 4.458.870€ giving a reduced
profitabilty of 36.948€.

Fig. 1. Case study entropy-minimization objective

The subsequent simulation of 110,000 trials aims to maximize the project’s NPV as
shown in Fig. 2. It is also subject to the constraint of not exceeding the total bid
price.The combination of bid markups produce a value of NPV equal to 4.506.728€
which is 10.909€ (1.87%) higher than the original. The observed measure of

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entropy is 136.50 which indicates a relatively high degree of disorder in the

construction process.

Fig. 2. Case study NPV-maximization objective

The final simulation set, utilizing decision variables, includes 60,000 trials and
intends to maximize the NPV while simultaneously reducing the monetary entropy
HM. In this case, the monetary entropy value cannot be lower than 90 while the
NPV-related objective remains the maximization of NPV. The best result recorded
satisfies the desired target giving a NPV value equal to 4.501.090€ and an entropy
value equal to 103.19. In terms of percentage, a profit increase of 1.17% is
obtained together with a decrease in entropy of 6.44%.

Fig. 3. Case study entropy and NPV joint objectives

3.3 Normal Distribution of bid markup value

For the particular simulation a number of 30,000 trials is performed using the bid
markup value assumed to be normally distributed and equal to 1.20 (20% profit)
and its standard deviation being equal to 10%. The maximum NPV value achieved
is 4.500.456€ while the monetary entropy value is HM=116.17. On the other hand,
the minimum value of monetary entropy recorded through normal distribution is
HM=103.81 with the value of NPV=4.474.224€. The obtained increase in the
number of maximized NPV is 1.03% compared to the balanced bid method, whilst
in the value of total project entropy there is an increase of 5.77%. With regards to
the minimum value of monetary entropy, it is decreased by 5.85%, whereas the
projects profit depicts a 4.83% meiosis.

Fig. 4. Case study monetary entropy and NPV distributions

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3.4 Triangular Distribution of bid markup value

Simulations based on triangularly distributed bid-markups were also executed. For

the specific scenario a number of 30,000 trials is performed using a bid markup
value of 1.20 (20% profit) with the standard deviation being equal to 10%. The
maximum NPV value achieved is 4.497.676€, while the monetary entropy value is
HM=108.45. On the other hand, the minimum value of monetary entropy recorded
through normal distribution is HM=104.90 with the value of NPV=4.479.361€. The
obtained increase in the value of maximized NPV is 0.32% compared to the
balanced bid method, whilst in the value of total project entropy there is a decrease
of 1.27%. With regard to the minimum value of monetary entropy, it is decreased
by 4.70% whereas the project’s profit depicts a 3.67% meiosis.

Fig. 5. Case study monetary entropy and NPV distributions

The results of all scenarios are summarized in Table 1.

Table 1. Summary of simulation results

NPV Entropy Bidprice
4.506.728 4.941.197
Decision Variables (max NPV) 136,50
€ €
4.458.870 4.900.839
Decision Variables (min Entropy) 90,64
€ €
Decision Variables (max NPV ∩ Limit 4.501.090 4.941.196
103,19
Entropy) € €
4.500.456 4.941.189
Normal Distribution (max NPV) 116,17
€ €
4.474.224 4.919.572
Normal Distribution (min Entropy) 103,81
€ €
4.497.676 4.941.150
Triangular distribution (max NPV) 108,45
€ €
4.479.361 4.908.443
Triangular distribution (min Entropy) 104,90
€ €
4.495.819 4.941.197
Balanced Bid 109,83
€ €

4. Conclusions

The methodology presented in this paper considers the effects of financial disorder
that arise due to the uncertainty of the project monetary resource allocation and
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the cashflow. Furthermore, the unbalanced-bid method is a complex problem that

demands complex optimization calculations. In the particular case study an
important decrease in the metric of entropy (6,44%) was achieved with the use of
decision variables compared to the classical method of balanced bid. This optimized
solution provided also an increased profitability for the project(1,17%). The above
may be interpreted as minimized monetary disorder and optimized cashflow that
enhance the sequence of work in the project and the final result.

The innovative element of this paper stems from the fact that it manages to
combine decreased financial risk with increased profitability during a project. The
advantages of this methodology will be more visible when applied in projects with
longer duration for completion. Finally, a future correlation of this methodology with
the human-resource allocation entropy is proposed.

5. References
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Carruthers, J. A. and Battersby, A. (1966), Advances in critical path methods,
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Choi, J. and Russell, J. S. (2005), Long - term entropy and profitability change of
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Christodoulou, S. (2007), Resource- constrained scheduling using Ant Colony
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Constrained Scheduling, Proc., Int. Project Management Association’s 4th
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Hegazy, T. (1999), Optimization of resource allocation and leveling using genetic
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Stark, R. M. (1968), Unbalanced bidding models - theory, ASCE Journal of
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INV3
Designing Project & Programme Organizations

Gareis Roland
(Vienna University of Economics and Business & ROLAND GAREIS
CONSULTING, Austria)

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W02
The Use of the Construction Registers to Measure the
Competitiveness of Small, Medium, & Micro Enterprise Contractors

Ms. Bridgette Gasa

(Lecturer, Nelson Mandela Metropolitan University, Port Elizabeth, South Africa)

Professor Winston Shakantu

(Professor, Nelson Mandela Metropolitan University, Port Elizabeth, South Africa)

Professor John Smallwood

(Head of Construction Management Department, Nelson Mandela Metropolitan
University, Port Elizabeth, South Africa)

Abstract
This abstract outlines the research focus aimed at demonstrating that the South
African construction industry’s use of the Construction Register Service (CRS),
would assist it to measure the competitiveness of Small, Micro and Medium
Enterprises (SMMEs). The CRS was developed by the Construction Industry
Development Board (CIDB) with the intent of offering a basis for sustainable
development, improved construction delivery, improved performance and
empowerment of the construction sector. The research conducted by the authors
expands the construction industry’s knowledge base in as far as it relates to
enhanced performance and the competitiveness of construction SMMEs.

The research limits itself to the levels of contractors registered between grades 2
and 5 with a view to establish a benchmark for contractor competitiveness within
those bands. The research’s unit of study is at company level drawing from a
reflection on the SMMEs active in industry delimited within the geographical area of
the Eastern Cape Province of South Africa. The research deals with a real problem
in industry and therefore the theoretical underpinnings of an epistemologically
objectivist paradigm have been employed in the study.

Keywords
SMMEs, contractor capability, competitiveness, contractor registers service.

1. Introduction

In the South African context, Small, Medium and Micro Enterprises (SMMEs) by and
large refer to the full spectrum of businesses other than large corporations and
publicly owned enterprises (DTI, 2005). SMME companies include categories known
as micro-enterprises, survivalist-enterprises, informal sector enterprises, formal
small and medium-sized enterprises and all businesses in all stages of evolution
otherwise referred to as start-ups, emerging or expanding enterprises (DTI, 2005).
The term also characterises family-owned, black-owned, women-owned or co-
operatively owned enterprises (DTI, 2005).

The South African construction industry lays a foundation for economic growth
through the provision of economic and social infrastructure (cidb, 2004). The
advance of the expansionary fiscal framework in South Africa, realized through a
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suite of construction projects within the sectors of rail, road, ports and power
valued at R787 billion of infrastructure investment; is set to outstrip formal
established contracting capacity (Creamer, 2009). It is expected that as the order
books of the established construction contractors are filled, demand will trickle
down to SMMEs. However, the observation within industry is that SMMEs have
limited contracting, delivery and employment generating capability. The limited
capability of SMMEs is considered a serious obstacle to the achievement of
government objectives whose intent it was to invest in public infrastructure to
bolster economic growth, employment creation and poverty alleviation. The South
African government recognizes the construction sector as a significant contributor
to the economy (5.6% contributor to the Gross Domestic Product of SA) and a
vehicle for employment creation. The current scenario is that there are 106 247
contractors registered with the Construction Industry Development Board (cidb). Of
that number of registered contractors 78% constitutes those generally defined as
contracting SMMEs (cidb, 2004).

The main problem identified by the construction industry was that there seems to
be more than sufficient capacity (in numbers) whilst the sectoral projects targeted
for the infrastructure investment through the national fiscus – are complex and
they require a higher level of sophistication and competence and as such matching
the numbers (of SMMEs) with the infrastructure investment would not have
adequately dealt with the challenge of the availability of capacity. It was therefore
evident that there needed to be ‘some new measure’ that sets the SMMEs apart and
as such this need gave impetus to this research. The aim, therefore of this
research was to investigate how the construction registers can be used to measure
the competitiveness of SMMEs with a view of adding suitable capacity to respond to
the sectoral infrastructure projects which the SA government has prioritized. This
would be done so as to enhance their capacity to deliver especially on economic
infrastructure projects for the sectors that have already been mentioned above. To
achieve this aim the study needed to:

i) identify the factors that drive competition in the SMME sector;

ii) through definition, inspire a culture of economic activism that drives
entrepreneurship within the SMME sector;
iii) identify the support mechanisms for SMMEs that can substantially
accelerate their growth and improve performance.

1.1 The Problem

There is a general lack of competitiveness within construction SMMEs. Most

construction SMMEs can hardly demonstrate management competencies and
resources (or capability) which could enable them to compete in a growing
construction economy.

1.2 Background

The construction Rregisters service (CRS) was developed by the Construction

Industry Development Board (CIDB) in terms of the Construction Industry
Development Board (CIDB) Act 38 of 2000. As a tool, it was designed to offer a
basis for sustainable construction development, growth, improved delivery,
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performance and sustainable empowerment. It was also developed to be used by

the construction industry to, inter alia, provide statistical data which would enable
the construction industry to better understand the contracting capacity in South
Africa. The research undertaken through the methodology of grounded theory
looked at how the CRS can be used to measure the competitiveness of a targeted
group of small contractors.

The competitiveness of construction SMMEs is a field that has not been explored in
the South African construction environment and therefore not enough prior
research has gone into the expansion of its knowledge and expertise. Most of the
research conducted to date has largely covered in great detail the imperatives of
growth, transformation and enhanced overall performance of the South African
construction industry. As the contractor registration process has stabilized
particularly over the past four years (2006-2010), the cidb has advanced with
reporting on progress against stated strategic objectives but also looking at overall
industry enhancement considerations. This it has done and communicated both to
the industry and the government administration through two quarterly publications.
The one being the Construction Industry Indicators (CIIs) and the other being the
Quarterly Monitor reports. The sole purpose of these reports is to provide industry
with a simple method of establishing a performance measurement system within
the industry. The benefits of doing this however has neither been qualified nor
quantified as yet.

Future studies should explore this gap as it was never the sole purpose of this
study to do so, however laying the foundation on what to measure and how to use
the CRS tool to measure it, is in itself the intention of this study. At present, the
SMME contractors progress up the grading system only on the basis of having had
demonstrated improved financial capability and an expansion of the value of work
and complexities in projects which they are now able to undertake. If they are not
able to demonstrate this growth, their attractiveness to construction clients and
their ability to aggressively pursue work (competitiveness) is curtailed or
constrained.

2. Unit of Study

The unit of study for the purposes of this research is at organization level; drawing
from a reflection on who is an active participant in the South African construction
industry. The research first conducts an in-depth analysis of the South African
construction industry, with a focus on the targeted SMME contractors, and it
proceeds to demonstrate how improved business processes within that sector would
result in enhanced competitiveness arising out of using the CRS tool to measure
that competitiveness. During the research work, the focus has been on the efficacy
of the CRS as a tool with which to measure competitiveness and its ability to
identify the areas needing targeted development to support SMMEs in being more
capable to undertake work to the level of complexity as that espoused by the
strategic projects which will be funded through the national fiscus.
The area of research was limited to one provincial geographical area, namely the
Eastern Cape Province. Within the first year of rolling out the cidb CRS (2004),
there were only 457 contractors registered. Currently, the South African
construction industry is comprised of 106 247 registered contractors (cidb, 2009).
Of that number, no less than 78% is made up of what the industry would classify as
SMME contractors and elucidated in the definition of SMMEs above. Hereunder is a

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table which indicates how many of that number (106 247) comes from the Eastern
Cape and the respective grades within which they are registered:

Eastern Cape Contractor statistics

Grade CE EB EP GB ME SW Total
Grades

1 2,180 65 122 7,625 141 795 10,928

2 121 12 1 179 6 27 346

3 72 4 2 58 3 3 142

4 68 9 3 49 1 5 135

5 38 5 6 26 4 79

6 26 1 27 54

7 7 1 9 1 18

8 2 2

Total 2,512 97 134 7,975 152 834 11,704

Table 1: Contractor Statistics within the delimited geographical area

3. Justification of Study

Current industry research has focused on construction activity across the country
and determining the state of health of the industry and its participants (Dlungwana
& Rwelamila, 2003). However none of the work that is currently produced within
the country gives a sense of whether the contracting fraternity of South Africa
appreciates what it could do for the country if it had a thriving and competitive
construction sector of the economy. The sector understands why government is
investing as much as it is in infrastructure, however there is no record of a debate
that has taken place amongst the participants within the construction industry
arguing for competitiveness as a measure of growth and improved performance for
this sector. Moving from a base of R458 billion for the Medium-Term Expenditure
Framework (MTEF) period of 2006/7/8 to the R787 billion investment in
infrastructure which government has set aside for the MTEF period of 2009/10/11,
the absence of such a debate has led to a lack of clarity on where the investment is
targeted and who within the sector will benefit and what the material effect of that
benefit would be.

There was a great need therefore for a research study that will provide an objective
assessment of why the construction sector needs to be interested in the
competitiveness of its SMME contractors. This is purely due to the fact that
competitive forces continue to drive companies to seek new areas of growth, with
either portfolio expansion or penetration into new markets (OECD, 2008). Although
the forces that weigh heavily on a company are recognised, their influence in
determining a company’s action in choosing a particular strategy is not as yet well
understood by most of the contractors that fall within the band that is the focus of
this research. The thesis recognised that this could be averted by appreciating the
natural progression of contractor capability as they move up the value chain of
grading through the cidb registers. The importance of this study is in that its
outcomes would present the SMME contractors with a proper understanding on the
practice of how their competitiveness is assessed or measured in the South African
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construction sector to enable the industry as a whole to measure not only

contractors’ individual competitiveness but also their subsequent contribution
towards the economic growth objectives espoused by government. Being in a
position to measure this would in itself lead to the achievement of sustainable
development and growth of the South African economy.

4. Defining Contractor Competitiveness

South Africa is regarded as one of the more sophisticated and promising emerging
markets in the world, offering a unique combination of highly developed first world
economic infrastructure with a vibrant market economy. It is also considered to be
one of the most advanced and productive economies in Africa. One of the aspects
that are considered to be incentives for doing business in South Africa can largely
be attributed to its competitiveness when engaging the global economy (SA
Tourism, 2007).

There is both the global definition of competitiveness as well as a local definition.

Competitiveness is a measure of a country's advantage or disadvantage in selling
its products in international markets. Competitiveness can be defined by country,
region, industry, company or product. The global definition of competitiveness is
that it is:

Competitiveness is an aggressive willingness to compete. It is the quality of

being bold and enterprising. It is also defined as the degree to which an
enterprise can, under free and fair market conditions, produce goods and
services which meet the test of international markets, while simultaneously
maintaining and expanding real incomes over the long term (OECD, 2006, p.
459).

There is an argument to be made for the competitiveness of organizations and what

is required to achieve that within their businesses. Fellows et al. (2002) define
strategic thinking as key in creating the competitive advantage for construction
firms. Within this assertion they explicitly single out three key areas within strategic
thinking which they claim create this competitiveness advantage and they list them
as follows:

 Strategic management;
 Managing people;
 Managing money, and
 Decision-making techniques.

Contractor competitiveness therefore defines something more than just contractor

competence (as this pertains to the value range of each tender that contractors are
able to handle and their track record based on the individual grades allocated
through the CRS). Competitiveness speaks to entrepreneurial innovation under five
group categories: contractor’s organisation, financial considerations, management
resource, experience used as an envisioning tool, and past performance (Flanagan
et al, 2007).

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5. Methodology

The study used non-probabilistic sampling which meant the research would be
purposive. The focus of its subjects - those SMME contractors who had worked on
projects which afforded them the opportunity to grow and demonstrate
competitiveness – were informative for the purposes of the research as it followed
the grounded theory approach. It was not necessary to have a cap on the number
of SMME contractors to be interviewed as the research’s basis was ‘grounded
theory’ which entailed conducting interviews regarding informative subjects and
only ceasing when a point of saturation had been reached and there can be no
further outcome of interest to be extracted. In total a group of 60 SMME companies
were interview at the time of producing this paper. Outcomes of the structured
interviews will be presented at the Conference.

6. Discussion

In considering the key enablers of competitiveness for this study it became quite
critical that the approach needing to be followed to analyse what ought to be done
to solve the problem statement, be contextualised in the following questions:

 What are the phenomena that give rise to the perceived lack of
competitiveness which plagues the lower end of entry into the
construction sector?
 How are the gaps of development identified and plugged so that SMMEs’
understanding of the competitive environment improves and with this a
further improvement of their competencies, performance output and
productivity are achieved?
 What would it take to enhance the attractiveness of SMMEs to clients?
 What could be used to empower SMMEs to approach work opportunities
in a bold and enterprising manner so as to guarantee their continuous
attainment of work?
 How could the competitiveness of SMMEs be assessed with a view to
create new models or procedures with which to enhance that
competitiveness?

7. Findings

As mentioned through the abstract the study is at a stage where the synthesis of
outcomes from the interviews is being undertaken and therefore there are no
conclusive findings that have as yet been finalized. However the early indications of
outcomes are hereunder listed:

 Examining existing or current research on contractor development

assisted the study to consider where and how competitiveness would be
crucial in enhancing growth and sustained participation of construction
SMMEs in the mainstream economy;
 Assessing the contracting ’capacity’ and capability within a geographic
area was possible;

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 Using the CRS to measure the competitiveness of selected SMME

contractors within a geographical area was possible and was beginning to
pronounce qualitative benefits;
 Identifying gaps on the understanding of SMMEs of the competitive
environment and attempting to close these, improves contractor
competencies, their performance output and productivity.

8. Conclusion

Superimposing the focus areas of this research forms a basis for a singular
approach towards a definition of competitiveness and its measurement system. This
goes a long way in assisting with outlining an integrated construction SMME
development strategy that would inform the industry on a holistic model that can
yield both quantitative and qualitative outcomes. Both the South African
government and the country’s construction industry are continuously engaged in a
process of encouraging industrial growth and performance which in turn will
support the country’s social and economic transformation. The ultimate objective is
sustainable growth, stability, employment, enhanced delivery, improved industry
performance and competitiveness, value for money and empowerment (cidb,
2004). In selecting contractors to perform work activities, decision makers must be
assured that the contractor selected has the capabilities to apply the best
innovative technologies in an enterprising manner towards their work. It is that
entrepreneurial flair and boldness; it is that ability to enterprise; which summarises
the kind of contractor competiveness that clients are looking for.

10. References

Construction Industry Development Board, (2004), “South African Construction

Industry: Status Report 2004”. South Africa, cidb
Construction Industry Development Board Quarterly Monitor (2008), “Progress
against Construction Industry Indicators”, Pretoria, cidb.
Creamer (2009), “Construction Plateau, where to from here?” Article published in
the Star Newspaper
Department of Tourism. (2006) Statistical Report. [online] Available from:
http://www.southafrica.net/satourism/research. [Accessed October 2007]
Department of Trade and Industry (2005), “Integrated Small Enterprise
Development Strategy”. Pretoria.
Department of Trade and Industry (2007), “Integrated Strategy on the Promotion
of Entrepreneurship and Small Enterprises”, [online]. Available from:
http://www.dti.gov.za. [Accessed September 2007]
Dlungwana, W.S. and Rwelamila, P.D. (2003), “The role of performance assessment
tools in improving contractor performance in developing countries”, Pretoria,
CSIR Boutek.
Fellows, R., Langford, D., Newcombe, R. and Urry, S. (2002) Construction
Management in practice. Malden, Blackwell Science. ISBN 0-632-06402-1.
2nd Edition
Flanagan, R., Lu, W., Shen L. and Jewell,C. (2007), “Competitiveness in
construction: a critical review of research”, University of Reading and The
Hong Kong Polytechnic University. Published in: Construction Management
and Economics, Volume 25, Issue 9 September 2007 , pages 989 – 1000

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Hu, D.L. (2001), “Theories and practices on competitiveness of enterprises”,

Beijing, Economic Management Press.
OECD: Organisation for Economic Cooperation and Development (OECD). (2008)
“Competitiveness of Nations”
Ofori, G. (2002), “Current issues in small construction contractor development”, In:
Miller, C., Packham, G. and Thomas, B. (eds.). Welsh Enterprise Institute
Monograph No. 4, pp. 37-58.

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AA048

A review of spatial considerations in project scheduling

Loukia Georgiou
(Researcher, Centre for Construction Innovation, National Technical University of
Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Yiannis Xenidis
(Lecturer, Aristotle University of Thessaloniki, Thessaloniki, Greece)

Abstract
Project scheduling is considered as a study of the relations between activities and
time, it is well known, however, that for certain types of projects spatial
considerations (e.g. site layout, facility planning, site congestion etc) should also be
taken into account. In this paper a literature investigation is performed with the
purpose of indentifying all methodologies and techniques that take into account
“space” as an entity in producing construction schedules and the practical
implications of this approach are discussed. It is argued that it is mainly a lack of
perception and not a scarcity of tools that by and large lead to spatial
considerations not being taken into account in most project time schedules.

Keywords
Space management, Construction planning, Construction scheduling

1. Introduction

The definition of space in the construction domain is hardly evident or explored

(Mallasi and Dawood 2002); throughout this paper is assumed that construction
space consists of: Workspace (the location where activities are executed), Product
Space (the space that occupy the components of the construction; i.e. walls),
Resource Space (materials’, equipment’s space), Storage Space (contains
temporary/permanent storage areas; e.g. staging areas) and Path Space (contains
the loading/unloading path for materials delivery and possibly equipment path; e.g.
crane rail) (Georgiou 2009).

Construction space management is a challenging task, as space is complex and

changes dynamically throughout the construction process, namely workspaces are
generated when a floor is built; while workspaces are limited when walls are built.
It is argued that effective space management has significant impact on construction
cost, productivity, safety and leads to schedule compression and space conflicts
avoidance (El-Rayes and Said 2009). Yet in construction, relatively little formal
attention is paid to the allocation of tasks to spaces and no standard tools,
comparable to those available for the sequencing of tasks provided by critical path
analysis and its derivatives, have gained acceptance among construction. The

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availability of space is typically based on intuition and rarely formalized beyond the
most basic rules of thumb.
This paper focuses on introducing all different approaches which have been
developed to automate the consideration of space requirements during planning
and scheduling. Current state of knowledge of space management is summarized
by a literature investigation to indentify all methodologies, tools and techniques
that take into account space as an entity in producing construction schedules and
the practical implications of this approach are also discussed.

2. Space Considerations in Construction Management Research

The primary aspects of research in space management are grouped into four
categories: (1) Path planning; (2) Site layout; (3) Space scheduling and (4)
Location based scheduling (Akinci et al. 2000; Akinci and Fischer 1998). The
aforementioned categories, their field of application and their limitations are
analysed in the following sections and the inputs and outputs of each approach are
shown in Fig 1.

Fig 1: Different approaches for space management (Akinci et al. 2000)

2.1 Path planning

In Path planning routes for construction equipment and operations are generated
and the shortest, collision-free path is identified according to work requirements
and the starting and destination points of the route. Typical applications include
routing large vehicles or heavy-lift operations on the construction site and various
algorithms have been developed. Varghese and O’Connor (1995) attempted to
model process of path planning through a set of predetermined rules and to provide
data display capabilities, by applying two computer technologies: GIS and expert
systems. Lin and Haas (1996) proposed a planning environment that uses
computer-aided drafting tools and a set of computerized planning primitives to
facilitate a very visual planning process, while Tserng et al. (1996) developed a
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computer-integrated operations planning system that simulates the site and

automatically generates path plans.
However, path planning studies focus on equipment and, in general, workers and
material storage are not included. In addition, space availability is considered fixed
within a specific time period, as path planning is viable when modelling a path
around fixed obstacles. When a facility changes continuously over time and multiple
paths and mobile objects need to be considered for each change, the path planning
approach becomes very complex; thus, path planning approach is most frequently
used to model the paths required by critical operations (Akinci et al. 2002a).

2.2 Site layout planning

Site layout planning includes the identification of the temporary facilities needed to
support construction operations (i.e. offices, tool trailers, warehouses, fabrication
yards), the determination of their size and shape and their positioning within the
site boundaries. In general, the objective of site layout is to position temporary
facilities in the best layout according to the shortest travel distance or minimum
travel cost between them. Regarding to the manner temporary facilities are
assigned on site, two distinct field of approaches are commonly encountered: (1)
facility to location assignment, which assigns a set of predefined facilities to a set of
predefined locations on site and (2) facility to site assignment, a more generic
approach, in which temporary facilities are assigned to any unoccupied space
available on site (Osman et al., 2003). Under these fields, site layout models are
grouped into two main categories: static and dynamic site layout planning.

A variety of methodologies and tools have been utilized for the production of static
site layout models such as computer-aided design (CAD) (Sadeghpour et al. 2004),
goal programming (Osman and Georgy 2005), computer simulation (Retik and
Shapira 1999; Dawood and Marasini 2002), Geographic information systems (GIS)
(Cheng and O’Connor 1996), knowledge-based systems (Tam et al. 2002; Chau
and Anson 2002; Sadeghpour et al. 2006), hybrid systems (Zhang et al. 2002) and
genetic algorithms (Hegazy and Elbeltagi 1999; Mawdesley et al. 2002; Zouein et
al. 2002; Cheung et al. 2002; Tam et al. 2001; Osman et al. 2003b; Khalafallah
and El-Rayes 2005, 2006). A single site layout that identifies static locations for all
temporary facilities in the project is produced and cannot be changed during the
construction progress. The dynamic changes in space needs and availabilities on
construction sites, as the schedule evolves, are not taken into consideration in
static models.

Dynamic site layout models, on the other hand, provide possible space reuse to
accommodate different resources at different times, relocation of resources and
consider the changing space needs of resources over time. This is accomplished by
subdividing the project’s schedule in periods and by identifying the available and
needed space of temporary facilities for each period. Many site layouts are
generated and optimized and the site layout plan is re-organized at frequent
intervals during the project. Recent studies focusing on solving dynamic site layout
problems adopt techniques and tools such as 4D CAD (Wang et al. 2004; Ma et Al
2005), genetic algorithms (Elbetagi et al. 2004), ant colony optimization (ACO)
algorithms (Ning et al. 2010), even a combination of artificial intelligence tools:
knowledge-based systems, fuzzy logic and genetic algorithms (Elbetagi et al.
2001). The latter model provides direct integration with a scheduling tool to
determine the schedule-dependent site needs. Furthermore, through the
development of an approximate dynamic programming model that considers future
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implications of layout decisions made in early stages, the identification of global

optimal dynamic site layout plans is possible (El-Rayes and Said 2009).

2.3 Space scheduling

In both static and dynamic site layout models the schedule is considered to be
given. In addition, activity scheduling and site layout are tackled as independent
problems. The combined problem is addressed by space scheduling approaches,
which focus on modelling the different types of work spaces required by
construction activities.

Space scheduling includes the planning of task execution spaces. In this approach
space is considered as a resource, which varies with time and all working elements
(workers, equipment, material, path and temporary facilities) are subjected to the
variations of time frames or schedules. The algorithms developed in space
scheduling mainly focus on creating a schedule to eliminate or minimize space
conflicts. Recent studies use fully automated approaches to assess space
availability and needs during scheduling activities and focus on space needs of
activities either inside buildings (Thabet and Beliveau 1994; Riley and Sanvido
1997; Zouein and Tommelein 1999) or on the whole site, by producing dynamic
layouts with schedule adjustment (Zouein and Tommelein 2001; Guo 2002; Winch
and North 2006). Tools and techniques such as 4D CAD (Akinci et al. 2002 a,b) and
4D simulations (Mallasi 2005) are adopted to create dynamic representations of
activities’ execution workspaces.

2.4 Location based scheduling

Kenley and Seppänen (2009) classify the methodologies for scheduling construction
work into activity-based scheduling and location-based scheduling. Activity-based
scheduling includes techniques such as the Critical Path Method (CPM), introduced
in the late 1950s and Gantt charts, the universal graphical representation of
schedules, which was introduced by Gantt and Taylor in the early 1900. Work is
treated as a series of packages which have (only) a time-based relationship to each
other. Each work package is considered discrete and there is no relationship
between locations and activities. In activity-based scheduling the physical location
of an activity and its relationship to surrounding locations are not taken into
consideration (Kenley and Seppänen 2009).

Space is, on the other hand, taken into account in location-based scheduling.
Research and development regarding the location-based scheduling methods has
been carried out since the 1940s and a variety of techniques appears in literature
(Jongeling and Olofsson 2007; Kenley and Seppänen 2009) under different names
such as ‘Line-of-Balance’, ‘Flowline’, ‘Construction Planning Technique’, ‘Vertical
Production Method’, ‘Time–Location Matrix Model’, ‘Time–Space Scheduling
Method’, ‘Horizontal and Vertical Logic Scheduling Logic for Multi-Story Projects’
and ‘Repetitive Scheduling Method’. In location-based scheduling techniques
location is an intrinsic component of the planning system and emphasis is given to
relate the location of work to the work to be done. Projects are divided into zones
so that each crew moves from one zone to another undisrupted and the schedule is
generated across two axes: time and zone-axis (Kenley and Seppänen 2009; Akinci
et al. 2002a).

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However, both activity and location-based methodologies do not explicitly address

the spatial configuration of activities, for example users have to look at 2D
drawings to identify and understand what building components are related to each
activity. The locations generated in location-based methods provide some spatial
information, but are only abstract representations of the real world; spatial
configuration of a project is often much more complex than the hierarchical location
structure depicted in a two-axis diagram. This is achieved through the use of
technologies of Geographic Information Systems (Poku and Arditi 2006; Bansal and
Pal 2007; Georgiou 2008) and 4D CAD (Jongeling and Olofsson 2007; Coyne 2008),
which enhance the abovementioned scheduling techniques by integrating the
schedule with its spatial components. A spatial insight of the project is provided
through the linkage of the schedule activities with their associate building elements
and a clear 4D understanding of the project is facilitated.

Furthermore, new location-based management systems, which use location as the

unit of analysis that drives the schedule planning and the progress control, have
recently been developed. Seppänen and Aalto (2005) developed a comprehensive
line of balance-based planning, scheduling and control system, supported by the
commercial software package DynaProject™, which constitutes the prevailing
planning methodology among the main contractors in Finland. Kenley and
Seppänen (2009) introduced the “Location-based management system”, which
combines activity and location-based logic: locations are used as the unit of
analysis for scheduling and activities as the unit of control. The system refers to a
set of planning and scheduling functions such as a risk simulation module based on
the Monte Carlo technique, a bill of quantities collecting the building materials that
are distributed among the activities, a procurement module for the supply of
building material and a national database with building productivity data. The
various functions of this planning, scheduling and control system are integrated in
VicoControl™ software, developed to implement the system.

3. Conclusion and future research

The present paper succinctly reviews recent progress in space considerations in

project scheduling discipline. The literature identified a variety of methodologies,
tools and techniques that can be applied to all four categories of “space
management problem”: path planning, site layout, space scheduling and location
based scheduling. The number of the relevant literature cited indicates the
significance of efficient space planning and it is argued that it is mainly a lack of
perception; the major focus of planning is set on activities and not on the objects
which are engaged in the activities, and not a scarcity of tools that by and large
lead to spatial considerations not being taken into account in most project time
schedules. The aforementioned categories are interdependent, but require rather
different approaches. Comparison between them could be possible by determining a
set of criteria, which would form the basis of comparison; however this goes
beyond the scope of the paper and could be the objective of future work based on
this review.

Space is suggested to be used as an intrinsic component, which will derive the

schedule planning process from the estimating system. When space is used as a
unit of analysis of the scheduling process; namely when the construction project is
broken down into its locations and not into its activities, then more precise
estimation of not only the quantities of the components, but also of the cost and
duration of the project is enabled. Both researchers and practitioners have already
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turned their interest towards this direction and new commercial software such as
VicoControl™ is being developed.

As an increasing trend of applying new advancing technologies, such as Virtual

Reality and Radio-frequency identification (RFID) in the building science and
construction management discipline is observed, it is believed that space
management will as well profit from them. Thus, future research is suggested to
focus on the above technologies, which are strongly expected to serve as platforms
for the development of new planning and controlling tools and will possibly put
forward new directions to space management problem, namely to address space as
a whole entity, by creating a virtual environment and exploring virtual scenes
throughout the construction site, in which all aspects of space (workspace,
resources, path, storage and product space) will effectively be planned and
managed during construction process.

4. References

Akinci, B. and Fischer, M. (1998), “Time-Space Conflict Analysis Based on 4D

Production Models”, ASCE Congress on Computing in Civil Engineering, 342-
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Akinci, B., Fischer, M. and Kunz, J. (2002a), “Automated generation of work spaces
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Management, 128(4), 306–315.
Akinci, B., Fischer, M., Kunz, J. and Levitt, R. (2000), “Automated Generation of
Work Spaces Required by Construction Activities”, CIFE Working Paper #58
Stanford University.
Akinci, B., Fischer, M., Kunz, J. and Levitt, R. (2002b), “Representing work spaces
generically in construction method models”, Journal of Construction Engineering
and Management, 128(4), 296–305.
Bansal, V.K. and Pal, M. (2007), "Potential of geographic information systems in
building cost estimation and visualization", Automation in Construction, 16(3),
311-322.
Chau, K.W. and Anson, M. (2002), “A knowledge-based system for construction site
level facilities layout”, Lect. Notes in Artif. Intell., 2358, 393–402.
Cheng M.Y. and O’Connor J.T. (1996), “ArcSite: Enhanced GIS for Construction Site
Layout”, ASCE Journal of Construction Engineering and Management, 122(4),
329–336.
Cheung, S., Tong, T.K. and Tam, C. (2002), “Site pre-cast yard layout arrangement
through genetic algorithms”, Automation in Construction, 11(1), 35–46.
Coyne, K. (2008), “Leveraging the Power of 4D Models for Analyzing and Presenting
CPM Schedule Delay Analyses”, 2008 AACE INTERNATIONAL TRANSACTIONS,
(www.icoste.org/AACE2008%20Papers/Toronto_bim03.pdf)
Dawood, N. and Marasini, R. (2002), “Visualization of a stockyard layout simulator
“SimStock:” A case study in precast concrete products industry”, Automation in
Construction, 12(2), 113–122.
Elbeltagi, E., Hegazy, T. and Eldosouky, A. (2004), “Dynamic layout of construction
temporary facilities considering safety”, ASCE Journal of Construction
Engineering and Management, 130(4), 534–541.
Elbeltagi, E., Hegazy, T., Hosny, A. and Eldosouki, A. (2001), ” Schedule-dependent
evolution of site layout planning”, Construction Management and Economics,
19(7), 689-697.
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El-Rayes, K. and Said, H. (2009), “Dynamic Site Layout Planning Using

Approximate Dynamic Programming”, ASCE Journal of Computing in Civil
Engineering, 23(2), 119-127.
Georgiou, L. (2008), “Applications of GIS for scheduling linear/ repetitive projects”,
Diploma Dissertation, Faculty of Civil Engineering, National Technical University
of Athens.
Georgiou, L. (2009), “Spatial References in construction scheduling”, MSc Thesis,
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Guo S.Y. (2002), “Identification and resolution of work space conflicts in building
construction”, ASCE Journal of Construction Engineering and Management,
128(4), 287-295.
Hegazy, T. and Elbeltagi, E. (1999), “EvoSite: evolution based model for site layout
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Jongeling, R. and Olofsson, T. (2007), “A method for planning of work- flow by
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Construction, 16(2), 189-198.
Kenley, R. and Seppänen, O. (2009), “Location Based Management for
Construction”, Spon Press, Abingdon/ New York.
Khalafallah, A. and El-Rayes, K. (2005), “Trade-off between safety and cost in
planning construction site layouts”, ASCE Journal of Construction Engineering
and Management, 131(11), 1186–1195.
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2002 Conference on Distributing Knowledge in Buildings, Aarhus School of
Architecture, Denmark, Vol. 2, 83-90
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construction site layout in project planning”, ASCE Journal of Construction
Engineering and Management, 128(5), 418–426.
Osman, H., Georgy, M.E. and Ibrahim, M.E. (2003), “A hybrid CAD based
construction site layout planning system using genetic algorithms”, Automation
in Construction., 12(6), 749–764.
Osman, H.M. and Georgy, M.E. (2005), “Layout planning of construction sites
considering multiple objectives: A goal-programming approach”, ASCE
Construction Research Congress, San Diego, April 5-7, 2005.
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Riley, D. and Sanvido, V. (1997), “Space Planning for Mechanical, Electrical,

Plumbing and Fire Protection Trades in Multi-Story Building Construction”, 5th
ASCE Construction Congress, Minneapolis, MN, 102-109.
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planning”, Automation in Construction, 13(6), 701-715.
Sadeghpour, F., Moslehi, O. and Alkass, S.T. (2006), “Computer-aided site layout
planning”, ASCE Journal of Construction Engineering and Management, 132 (2),
143–151.
Seppänen, O. and Aalto, E. (2005), “A Case Study of Line-of –Balance Based
Schedule Planning and Control System”, 13th Annual conference of Lean
Construction, Sydney, Australia, International Group of Lean Construction.
Tam, C.M., Tong, T.K. and Chan, W.K.W. (2001), “Genetic algorithms for optimizing
supply locations around tower crane”, ASCE Journal of Construction Engineering
and Management., 127(4), 315–321.
Tam, C.M., Tong, T.K., Leung, A.W. and Chiu, G.W. (2002), “Site layout planning
using non structural fuzzy decision support system”, ASCE Journal of
Construction Engineering and Management, 128(3), 220–231.
Thabet, W. and Beliveau, Y. (1994), “Modelling Work Space to Schedule Repetitive
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computer-integrated operation planning system for autonomous land fill
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incremental solution method”, ASCE Journal of Construction Engineering and
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Space Scheduling”, ASCE Journal of Construction Engineering and Management,
127(2), 116-124.
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AA022

Visualising Time: a GIS Approach

Loukia Georgiou
(Researcher, Centre for Construction Innovation, National Technical University of
Athens, Athens, Greece)

Ekaterini Varanou
(Researcher, Centre for Construction Innovation,National Technical University of
Athens, Athens, Greece )

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
This paper presents a methodology for visualizing in 3D the scheduling time data
associated with the construction of a linear/ repetitive project. The Repetitive
Scheduling Method (RSM) algorithm is used to provide the time data which then are
visualized in a Geographical Information Systems (GIS) environment. A three
storey building is modeled with this methodology to illustrate the applicability of the
concept and to underline the benefits of the spatial and time data integration. This
visual understanding of the project allows efficient schedule communication among
the interested parties, although the methodology has still opportunities for
improvement mainly in the field of software package integration on a single
platform.

Keywords
3D Visualisation, Repetitive Scheduling Method, Geographic Information System,
Data integration

1. Introduction

Most scheduling techniques relate project activities with time; representing a logical
process and enabling the calculation of start and finish dates of the activities while
representing their inter-relationship.

Visualizing the construction sequence during the planning phase can assist project
planners and detect mistakes and potential problems at an early stage. During the
construction phase, visualizing the action and interaction of project activities
establishes potential space conflicts (Jeljeli et.al 2003). The importance of the
location/space of activity implementation in construction management is thus
straightforward.

It is beyond the scope of this paper to discuss the scheduling method used to
obtain the time data. The problem posed by projects with repeating activities and
technical precedence constrains has been discussed for many years and has led to
several methodologies that meet specific objectives. This study uses the Repetitive
Scheduling Method (RSM) introduced by Harris and Ioannou (1998), a simple and

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easily applied scheduling methodology that follows from the concepts found in CPM
precedence networks.

The primary objective of this paper is to demonstrate how to link the time and
spatial data of a project in a single computer environment, namely that of
ArcInfoGIS®. Once this linkage is successfully completed, the user can fully utilize
the capabilities of the GIS environment and perform simple or complex queries to
obtain answers to specific questions. ArcInfoGIS® was chosen because it is a
commercial, complete GIS out of the box, with a user friendly interface.

A Case Study of a building is used to aid the presentation of the methodology under
discussion. The original technical drawings of the building, available in the form of
AutoCAD® were slightly modified to obtain the level of detail required. Again,
AutoCAD® was preferred to other commercial software because it is used widely for
drafting purposes in the technical industry.

2. Methodology for Visualizing the Schedule

A three storey building is used as a case study to implement the methodology

discussed in this paper. The building consists of prefabricated metallic columns and
slabs connected through joints in situ. The structural skeleton that results as the
aforementioned structural elements' assembly includes channels where pipework
installation is performed before the floor concrete pouring. The completion of the
construction is performed by concrete casting and walls and frames placement. The
floors are identical and the project is classified into the category of repetitive
projects.

The steps performed to integrate the textual and spatial information of the project
in GIS, the attachment of different information to the corresponding components of
the building and the information retrieval mechanism (queries) are fully described
with the aid of the case study.

Step 1: Generation of time data

Activity durations and precedence relationships of one unit, namely one floor of the
repetitive project examined are defined and presented in Table 1.

Task Activity Duration Predecessor Lag

1 Foundation 2 - 0
2 Assembling 1 1 0
3 Pipework 1 1 1
4 Stair Units 1 1 1
5 Concrete casting 1 2,3 0
6 Walls 3 5 2
7 Frames 1 6 0

Table 1: Activity Information for one unit

The planned start and completion dates of each Activity in every unit were
calculated using the Repetitive Scheduling Method, taking into account that Task 1

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is only executed in unit 1 (ground floor) and Task 4 is not executed in unit 3 (top
floor). The actual start and finish dates were assumed for exploratory purposes.
The required time data of all activities in all floors are assembled in the Schedule
table, the fields of which are presented in Table 2.

Fields of Schedule Table

FIELD DESCRIPTION
Two-digit Number, combines units and activities.
Task_ID Task_ID 32 represents the Activity Pipework executed in the
second floor (Task 3/ unit 2).
PS Planned Start Date
PF Planned Finish Date
AS Actual Start Date
AF Actual Finish Date

Table 2: Fields of Schedule Table

Step 2: Generation and transfer of building components.

Only one 2D drawing of a single floor was prepared in AutoCAD®, since all floors are
identical in a repetitive project. Having this technical drawing, the 3D view of the
entire building can be prepared by multiplying and editing this layer in ArcInfoGIS®
To express the spatial dimension of each activity, meaning to relate each activity to
the corresponding components of the building, the 2D drawing is further divided
into its building components, which are grouped in 4 layers and transferred into the
ArcInfoGIS® namely slab, column, wall and frame layer (Fig.1). Stairs and pipework
were excluded from this case study to simplify the process.

Fig 1: The architectural design divided into 4 layers

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Step 3: Generation of the entire building in ArcInfoGIS®.

ArcInfoGIS® can import AutoCAD® layers, but in order to manage their containing
information, some manipulations have to performed. This is because in an
ArcInfoGIS® shapefile (layer), all features need to share the same geometry type,
which is not the case with AutoCAD® layers. Shapefiles are a simple, nontopological
format for storing the geometric location and attribute information of geographic
features. Thus after transferring the 4 layers into ArcInfoGIS®, all features are
converted to polygons and the layers to shapefiles. The Append functionality of
ArcInfoGIS® is then used to create the other two identical storeys of the case study
building.

Step 4: Adjusting the Attribute Table.

In Shapefiles there is always a linkage between the spatial and attribute data. For
each feature transferred to ArcInfoGIS® its own attribute table is automatically
generated that define the non spatial parameters of the features. There is really no
limit to what the tables can contain and different columns can be inserted, sorted
and selected according to the user's need. The Attribute Table created in this study
consists of the fields shown and described in Table 3.

Fields of Attribute Table

FIELD DESCRIPTION TYPE OF DATA
FID Feature ID Numeric, Numbering done by GIS
BASE Lower Height of a Feature Numeric
HEIGHT Upper Height of a Feature Numeric

Table 3: Fields of Attribute Table

Step 5: Generation of a 3D View in ArcInfoGIS®.

To display a 3D perspective view, the features of a 2D layer generated in AutoCAD®

were assigned a base height and feature height from the fields of their own
attribute table. The base height is the elevation value for the features of a layer in
3D space. The extrusion tool in ArcScene® of ArcInfoGIS® was used to change the
polygons into 3D blocks. Different colors were assigned to layers to differentiate
them and give a better view of the project.

Step 6: Linking the 3D model with the construction schedule.

To construct the spatial data of each activity in every floor a field named Task_ID
was added to the Attribute Table of each component. The field Task_ID is common
between the Attribute and Schedule tables and is used to establish the connection
between each component and the corresponding activity in the schedule, according
to the principles of any database. The attribute required to associate the
components with the corresponding activities in the schedule are the entries in the
field Task_ID. The linkage of the 3D model with construction schedule is shown in
Fig 2.

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Fig 2: Linking the 3D model with construction schedule

Step 7: Retrieving Information in a 3D View.

Since space and time data are incorporated in a single GIS environment and a
visual overview of the project can be created and used to reflect the situation.
Features can be selected by their location or by their attributes, while more
complex searches can be performed by combining queries. Progress information for
an individual activity as well as for a set of activities can also be viewed. Fig 3
shows a 3D View of construction progress in a control date.

Fig 3: 3D View of the constructed components in a control date

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3. Benefits and Limitations of the System

Scheduling techniques, such as RSM, do not provide any information about the
spatial aspects of the activities of a construction project. To identify the building
components, which are related to each activity or to interpret progress information,
namely what is built at a particular time, users normally look at 2D drawings and
conceptually gain spatial configuration of the project. This results to inconsistent
interpretations and usually makes effective communication among the interested
parties of the project difficult. With the proposed methodology, the spatial
characteristics and relevant time data of the project can be displayed in GIS in
order to obtain a better understanding of the project. This “visual” check of the
schedule enables the user to avoid space conflicts and omission of activities, since
all components are related to activities. Furthermore, the visual observation and
understanding of the progress of the project helps the parties involved to
communicate better.

The collection and management of various types of information efficiently and on

demand is seen as the key for successful management of construction projects
(Poku and Arditi 2006) and the capabilities of GIS to store huge data can be utilized
towards this direction. The resulting GIS-based methodology maintains the
project’s spatial and time data in one digital database, which can be easily accessed
and updated during the construction of the project. In the present study the
required data were manually transferred into GIS, however work is underway to
automate the process. The existing database could also be enriched by adding all
sorts of information associated with the project (e.g. percent complete, material,
cost, safety and quality control recommendation) in the attribute table.

It should be noted that this study was about time/space data integration and
visualization rather than software integration into a single platform. This is an
important limitation when it comes to case studies with a large amount of data.
Another limitation derived from the previous sentence is that data exchange
between the two software packages (AutoCAD® and ArcInfoGIS®) is not automatic,
as explained in detail in the previous paragraph. A dynamic exchange of data
between any two software packages requires several rules and criteria regarding
the format of the data.

Overall, the future challenge in this field of research is to create a single platform,
on which construction scheduling tools are dynamically linked with the visualization
tools. Data integration and transfer without interruption and user interference can
deliver timely and accurate information to the interested parties.

4. Conclusions

The present paper acknowledges the advantages resulting from the visualisation of
the project activities during the design or the construction phase and outlines a
methodology for linking time with spatial data of a repetitive construction project.

A case study is used to illustrate the steps of the procedure which is

straightforward. Practical considerations refer to the data interchange between the
“spatial” software used and the data manipulation to obtain the desired attributes.
This is however common in the computer technology and was expected. The
benefits on the other hand from this application refer mainly to the common
interpretation of the project schedule and the visualisation of space conflicts and
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activity omissions. Concluding overall, “a frame in time” is always advancement in

project management.

5. References

ArcInfoGIS®, ESRI, Inc (2010).

AutoCAD®, AutoDESK, Inc (2010).
Bansal, V.K. and Pal, M. (2007), "Potential of geographic information systems in
building cost estimation and visualization". Automation in Construction, 16(3),
311-322.
Harris, R.B. and Ioannou, P.G. (1998), "Scheduling Projects with Repeating
Activities'', ASCE Journal of Construction Engineering and Management, 124(4),
483-491.
Jeljeli, M.N, Russell J.S, Meyer, H.W and Vonderohe, A.P (2003), “Potential
Application of Geographic Information Systems to Construction Industry”, ASCE
Journal of Construction Engineering and Management, 119(1), 72-86.
Jongeling, R. and Olofsson, T. (2007), “A method for planning of work- flow by
combined use of location- based scheduling and 4D CAD”. Automation in
Construction, 16(2), 189-198.
Poku, S.E., Arditi, D. (2006), "Construction Scheduling and Progress Control Using
Geographical Information Systems". ASCE Journal of Computing in Civil
Engineering, 20(5), 351-360.

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AA041
Conceptual Modeling of Cause and Effect Relationships among Crisis
Elements in Projects Using Fuzzy Cognitive Maps

M.T. Giannopoulou
(Graduate Student, University of Piraeus, Piraeus, Greece)

Dimitrios M. Emiris
(Associate Professor, University of Piraeus, Piraeus, Greece)

Abstract
During the project lifecycle, special treatment is required for crises, which may be
prompted by the sudden trigger of internal or external perturbations, or they may
be generated and become self-enforcing over time until a certain threshold-limit is
reached. Crisis management, therefore, emerges as an essential systematic
process, inherent in project management, which involves attempts to predict or
identify potential crises that an organization may encounter, take precautions to
prevent them, or minimize their effects. The variety of crisis types inhibits the
generation of a unified treatment of crises; instead, it is more appropriate to isolate
and group the most common crisis situations and their characteristics and aim to
depict the relationships between crisis causes and effects.
In this work, we not only identify and verify these relationships but we also solicit
the negative / positive effects between them and we assign a weight in it. To
achieve this, we use the theory of Cognitive Maps (CMs) (based on qualitative
reasoning) and its extension to Fuzzy Cognitive Maps (FCMs). Generally, the basic
elements of a CM are simple, the concepts used are represented as nodes, and the
causal relationships between these concepts are represented as directed arrows.
Each arrow is characterized by a weight, a real value that indicates the effect of the
causal relationship between nodes. The inputs and outputs of our model concern
the basic characteristics of crisis and the ways of managing them.
The main deliverable of our work is the representation, using FCMs, of the
relationships between crisis triggers and impacts, and the provision of a model of
cross-correlations and interactions that can forecast the crisis outcomes depending
on various confrontation strategies. We deepen our modeling by analyzing all the
phases in the crisis “lifecycle” and, namely, pre-crisis, main crisis, re-establishment
and learning, and model their inherent relationships. The resulting model provides
an explanatory overview of the project crisis management mechanisms, useful for
both the theorist and the practitioner.

Keywords
Crises, Crisis Management techniques, Cognitive Maps, Fuzzy Cognitive Maps

1. Introduction

Enterprises are often threatened by crises, some of which could have been
prevented or their impact lessened if knowledge of causal and influencing factors
were known and better managed (Wang & Belardo (2005)). A critical situation may
be caused by nature or may be man-made. The latter may result from the loss of
technological control or from identifiable human errors, they may point to
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deliberate attempts to reshape the social and political fabric, or they may follow
from a constellation, if not sheer coincidence, of unfortunate factors. Crises can
have international, domestic, local, or organizational dimensions, or a mixture of
these. Crisis analysts have been trying to impose order on this variety by
developing typologies of crisis events (Rosenthal & Kouzmin (1997)).

In this work, we use the theory of Cognitive Maps (CMs) (based on qualitative
reasoning) and its extension to Fuzzy Cognitive Maps (FCMs) to model the
relationships among internal and external elements (causes and effects) of crises.
Generally, the basic elements of a CM are simple, the concepts used are
represented as nodes, and the causal relationships between these concepts are
represented as directed arrows. Each arrow is characterized by a weight, a real
value that indicates the effect of the causal relationship between nodes. Their graph
structure allows systematic causal propagation, in particular forward and backward
chaining, and it allows knowledge bases to be grown by connecting different FCMs.
FCMs are especially applicable in soft knowledge domains, where both the system
concepts/ relationships and the meta-system language are fundamentally fuzzy,
(Kosko (1986)). The inputs and outputs of our model concern the basic
characteristics of crisis and the ways of managing them.

The paper is organized as follows: Section 2 provides the theoretical background on

which the model is based, while Section 3 briefly describes the formulation and
development of a FCM. Section 4 presents the CMs and FCMs for describing
relationships between crisis characteristics and ways of crisis management. Finally
our conclusions are presented in Section 5.

2. Background theory

Several definitions have been presented to describe what a crisis is. Some of these
are included in the work of Hwang & Lichtenthal (1999) and are provided herein.
According to Hermann, a crisis may be defined as a situation with high threat level
and short decision time that surprises the members of the decision-making unit.
Proposing a reformulated framework for crisis, Billings et al. suggested that the
extent of crisis depends on perceived value of possible loss, perceived probability of
loss, and perceived time pressure. Borrowing from definition-based research, Clark
attempted to develop a tentative definition for crises. It consists of three elements:
threat to goals; reduced ability to control or direct the environment; and perceived
time pressure. Organizational crises are highly ambiguous situations where causes
and effects are unknown, have a low probability of occurring but, nevertheless,
pose a major threat to the survival of an organization and to organizational
stakeholders, offer little time to respond, sometimes surprise organizational
members and present a dilemma in need of decision or judgment that will result in
change for better or worse (Pearson & Clair (1998)).

Although it is difficult for crises to be categorised, some researchers managed to

group the crises depending on their common characteristics, the ways of
management, as well as the results that they can have. The type of a business
crisis can be determined by evaluating its degree of similarity to each of five major
natural and man-made disasters, Earthquakes, Floods, Hurricanes, Nuclear
Accidents, and Oil Spills. Such an evaluation is done by examining eight crisis
characteristics, Exposure, Destructive Potential, Scope of Impact, Duration,
Predictability, Controllability, Speed of Onset, and Length of Forewarning, of the
crisis (Wang & Belardo (2005)).
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Crisis can occur within any company, irrespective of the size. Also crises can occur
when things are going extremely well. It has been noticed that companies that
have been overwhelmingly successful for a long time tend to become complacent
even though the initial assumptions and environment conditions have changed.
Under these conditions, crises are more likely to occur (Kerzner (2005)).

Crisis management is defined as a systematic process by which an organization

attempts to predict or identify potential crises that an organization may encounter,
take precautions to prevent the crises, or minimize the effects of the crises (Preble
(1997)). Organizational crisis management is a systematic attempt by members of
the organization and external stakeholders to avert crises or to effectively manage
those that do occur. Organizational crisis management effectiveness is evidenced
when potential crises are averted or when key stakeholders believe that the success
outcomes of short and long range impacts of crises outweigh the failure outcomes
(Pearson & Clair (1998)). Crisis management efforts are effective when operations
are sustained or resumed, organizational and external stakeholder losses are
minimized, and learning occurs so that lessons are transferred to future incidents.

According to the above we can say that crisis is a situation with low probabilities of
appearance and because of that can surprise the involved members who may face
it subjectively, while it is certain that it can threaten organization's objectives or
even its viability and for this reason it requires the direct reaction of all involved.
Some of these characteristics, as also some of the basic crisis management
techniques are used as concepts in our model in order to find out a general
interaction between them.

3. Cognitive & Fuzzy Cognitive Maps

As far as Cognitive and Fuzzy cognitive maps are concerned, Cognitive Maps (CMs)
firstly introduced in the 1970s by political scientist Robert Axelrod for representing
social scientific knowledge. Axelrod’s CMs are signed digraphs based on qualitative
reasoning and can be used to cope with knowledge that generally involves many
interacting concepts. Generally, the basic elements of a CM are simple: The
concepts used by an individual decision-maker are represented as nodes, and the
causal relationships between these concepts are represented as directed arrows. A
positive edge from node A to node B means A casually increases B, while, a
negative edge from A to B means casually decreases B. Cognitive Maps facilitate
documentary coding, constructing symbolic representation of expert documents
(Kosko (1986)). Kosko extended the graphs of Axelrod to the fuzzy mode thus
creating Fuzzy Cognitive Maps (FCMs), which were originally proposed as a means
of explaining political decision-making processes. Each arrow is now characterized
by a weight, a real value that indicates the effect of the causal relationship between
nodes. Carson and Fuller include a number of reports that describe such cases of
FCM implementation modelling specific environments like decision-making and
policymaking (Andreou et. al. (2004)).
The advantage of this representation is that it offers a global view of the various
links between causal relationships and concepts in the model. Three different types
of causal relationships between two nodes p and q (pq) are represented in the
map indicating the effects as follows:
- Positive (+) causality, in cases in which p promotes, enhances, or is a benefit to
q. An increase in the cause variable will bring about an increase in the effect

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variable, or a decrease in the cause concept will result to a decrease in the effect
concept.
- Negative (-) causality, in cases in which p retards, prevents, or is harmful to q. In
such cases an increase in the cause variable will end up with a decrease of the
effect variable and vice-versa.
- No effect (0), when p has no effect on, or does not matter for q.

The introduction of fuzzy logic contributed to enhancing the potential of the CMs,
indicating both the type of representation of the causal relationships between
concepts (i.e., positive, negative, zero) and the degree or strength of this
relationship. Fuzzy Cognitive Maps (FCMs) are soft computing tools, which combine
elements of fuzzy logic and neural networks. FCM theory was developed recently as
an extension of cognitive maps used for planning and decision-making in the fields
of international relations, social systems modelling and the study of political
developments in the context of such systems. Strictly speaking, a FCM is a figure
composed of nodes and edges, the former introducing the qualitative concepts of
the analysis while the latter indicate the various causal relationships. Each concept
node possesses a numeric state, which denotes the qualitative measure of its
presence in the conceptual domain. Thus, a high numerical value indicates that the
concept is strongly present in the analysis while a negative or zero value indicates
that the concept is not currently active or relevant to the conceptual domain.

An FCM works in discrete steps. When a strong positive correlation exists between
the current state of a concept and that of another concept in a preceding period, we
say that the former positively influences the latter, indicated by a positively
weighted arrow directed from the causing to the influenced concept. By contrast,
when a strong negative correlation exists, it reveals the existence of a negative
causal relationship indicated by an arrow charged with a negative weight. Two
conceptual nodes without a direct link are, obviously, independent.

4. FCMs for describing relationships between crisis characteristics

and ways of crisis management

The methodology of CMs and FCMs is employed herein to develop a general model
which uses the basic crisis characteristics and the basic management techniques as
qualitative concepts, which are used at the preparation of an organization for a
potential crisis, and during a crisis. The causal relationships between these
concepts are indicative and accrued from literature. These qualitative concepts are
summarized and described in Table 1; concepts C1 to C5 correspond to some crisis
management techniques which take place during preparation of the organization for
a potential crisis, concepts C6 to C15 correspond to basic and permanent crisis
characteristics, while concepts C16 to C24 correspond to some crisis management
techniques which take place during the crisis. Concepts C5 “Vulnerability
minimization”, C12 “Scope of Impact” and C23 “Prevent situation from getting
worse/ Control damage”, are considered fundamental for our model, and as such
they will be further analyzed.

C1 Learning/ Experience C13 Cognitive restrictions/ Ambiguity of

acquisition/ Knowledge cause, effect and means of resolution
C2 Danger determination/ Forecast/ C14 Adverse conditions of communication
Evaluation
C3 Action plan/Alternative C15 Subjectivity
strategies
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C4 Potential danger minimization C16 Ascertainment

C5 Vulnerability minimization C17 Gather information
C6 Probability C18 Risk determination
C7 Predictability C19 Action plan determination
C8 Warning signals C20 Stakeholders intervention
C9 Speed of onset/ Time pressure C21 Bureaucracy expulsion
C10 Controllability C22 Transparency
C11 Destructive potential C23 Prevent situation from getting worse/
Control damage
C12 Scope of impact C24 Stakeholders support/ Restore /
Damage identification

Table 1: Description of the concepts

The resulting CM is depicted in figure 1, where concepts are represented as nodes,

and the causal relationships between these concepts are represented as directed
arrows. The weights descriptions for the cognitive map are given in Table 2.

Fig 1: Cognitive Map 1, Relationships between Basic Crisis Characteristics and Ways of
Management before Crisis occurs as also during the crisis

In Figure 1, we notice that concept C3 (“Action plan/Alternative strategies”), affects

concepts C5 (“Vulnerability minimization”), C9 (“Speed of onset/ Time pressure”),
C10 (“Controllability”), C12 (“Scope of impact”), C13 (“Cognitive restrictions/
Ambiguity of cause, effect and means of resolution”), C14 (“Adverse conditions of
communication”) and C15 (“Subjectivity”), while it is affected by concepts C1
(“Learning/ Experience acquisition/ Knowledge”), C2 (“Danger determination/
Forecast/ Evaluation”), C13 (“Cognitive restrictions/ Ambiguity of cause, effect and
means of resolution”) and C15 (“Subjectivity”).

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W1: C1,C2 W20: C4, C5 W39: C9, C11 W58: C15, C11 W77: C15, C18 W96: C20, C17
W2: C1, C3 W21: C4, C6 W40: C9, C14 W59: C15, C14 W78: C15, C22 W97: C20, C18
W3: C1, C4 W22: C4, C11 W41: C10, C11 W60: C8, C16 W79: C17, C10 W98: C20, C19
W4: C1, C5 W23: C5, C4 W42: C10, C12 W61: C9, C17 W80: C17, C13 W99: C20, C23
W5: C1, C7 W24: C5, C6 W43: C11, C13 W62: C10, C23 W81: C17, C18 W100: C20, C24
W6: C1, C10 W25: C5, C7 W44: C12, C11 W63: C11, C16 W82: C17, C19 W101: C21, C9
W7: C1, C13 W26: C5, C10 W45: C13, C2 W64: C11, C18 W83: C17, C23 W102: C21, C22
W8: C2, C3 W27: C5, C11 W46: C13, C3 W65: C11, C19 W84: C17, C24 W103: C21, C23
W9: C2, C4 W28: C5, C12 W47: C13, C4 W66: C11, C23 W85: C18, C19 W104: C21, C24
W10: C2, C5 W29: C5, C14 W48: C13, C5 W67: C12, C24 W86: C19, C10 W105: C22, C14
W11: C2, C7 W30: C5, C15 W49: C13, C7 W68: C13, C17 W87: C19, C11 W106: C22, C17
W12: C2, C13 W31: C6, C11 W50: C13, C11 W69: C13, C18 W88: C19, C12 W107: C22, C23
W13: C3, C5 W32: C7, C2 W51: C13, C12 W70: C13, C19 W89: C19, C13 W108: C22, C24
W14: C3, C9 W33: C7, C4 W52: C14, C10 W71: C13, C23 W90: C19, C14 W109: C23, C6
W15: C3, C10 W34: C7, C5 W53: C14, C11 W72: C13, C24 W91: C19, C23 W110: C23, C12
W16: C3, C12 W35: C7, C11 W54: C14, C12 W73: C14, C17 W92: C19, C24 W111: C24, C12
W17: C3, C13 W36: C7, C13 W55: C14, C13 W74: C14, C18 W93: C20, C10
W18: C3, C14 W37: C8, C7 W56: C15, C2 W75: C14, C19 W94: C20, C12
W19: C3, C15 W38: C9, C10 W57: C15, C3 W76: C14, C22 W95: C20, C15

Table 2: Description of the Weights for Cognitive Map in Figure 1

The types of causal relationships between the concepts (positive causality (+),
negative causality (-) and no effect (0)) are shown in Table 3. We denote as
eij=e(Ci, Cj), the causal edge function value, where, the causality causal concept
node Ci impacts to Cj. Ci causally increases Cj if eij=1, causally decreases Cj if eij=-
1, and impacts no causality if eij=0 (Kosko (1986)). For example, in Table 3,
concept Ci = C1 which corresponds to “Learning/ Experience acquisition/
Knowledge” increases Cj=C2 which corresponds to “Danger determination/
Forecast/ Evaluation”, while at the same time Ci=C1 decreases Cj=C13 which
correspond to “Cognitive restrictions/ Ambiguity of cause, effect and means of
resolution”. Finally, concept C1 has no impact to concepts C6, C8, C9, C11, C12,
C14 and C15 to C24.

In order to transform the CM into an FCM, fuzzy relations between concepts were
introduced by assigning indicative weights depending on the amount of effect that
we estimated as valid. More specifically, a weight of 0, 0.18, 0.36, 0.54, 0.72, 0.9
and 1 was assigned when the influence between two concepts was evaluated as
absent, very weak, weak, medium, strong, very strong, and absolute, respectively.
The weight matrix for the FCM is given in Table 4. As an example, a weight
W1=0,72 represents a strong influence between concepts C1 “Learning/ Experience
acquisition/ Knowledge” and C2 “Danger determination/ Forecast/ Evaluation”. This
is because earning knowledge and learning from previous critical situations can
strongly increase the forecast of a potential critical situation, the evaluation of the
potential critical situation, as also can strongly increase the danger determination.

C C C C C C C C C C C C C C C
C C C C C C C C C 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2
1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4
C1 0 1 1 1 1 0 1 0 0 1 0 0 -1 0 0 0 0 0 0 0 0 0 0 0
C2 0 0 1 1 1 0 1 0 0 0 0 0 -1 0 0 0 0 0 0 0 0 0 0 0
C3 0 0 0 0 1 0 0 0 -1 1 0 -1 -1 -1 -1 0 0 0 0 0 0 0 0 0
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C4 0 0 0 0 1 -1 0 0 0 0 -1 0 0 0 0 0 0 0 0 0 0 0 0 0
C5 0 0 0 1 0 -1 1 0 0 1 -1 -1 0 -1 -1 0 0 0 0 0 0 0 0 0
C6 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0
C7 0 1 1 1 1 0 0 0 0 0 -1 0 -1 0 0 0 0 0 0 0 0 0 0 0
C8 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0
C9 0 0 0 0 0 0 0 0 0 -1 1 0 0 1 0 0 -1 0 0 0 0 0 0 0
C10 0 0 0 0 0 0 0 0 0 0 1 -1 0 0 0 0 0 0 0 0 0 0 -1 0
C11 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 1 0 1 1 0 0 0 -1 0
C12 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 1
C13 0 -1 -1 -1 -1 0 -1 0 0 0 1 1 0 0 0 0 -1 -1 -1 0 0 0 -1 -1
C14 0 0 0 0 0 0 0 0 0 -1 1 1 1 0 0 0 -1 -1 -1 0 0 -1 0 0
C15 0 -1 -1 0 0 0 0 0 0 0 1 0 0 1 0 0 0 -1 0 0 0 -1 0 0
C16 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
C17 0 0 0 0 0 0 0 0 0 1 0 0 -1 0 0 0 0 1 1 0 0 0 1 1
C18 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0
C19 0 0 0 0 0 0 0 0 0 1 -1 -1 1 -1 0 0 0 0 0 0 0 0 1 1
C20 0 0 0 0 0 0 0 0 0 1 0 -1 0 0 1 0 1 1 1 0 0 0 1 1
C21 0 0 0 0 0 0 0 0 -1 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1
C22 0 0 0 0 0 0 0 0 0 0 0 0 0 -1 0 0 1 0 0 0 0 0 1 1
C23 0 0 0 0 0 -1 0 0 0 0 0 -1 0 0 0 0 0 0 0 0 0 0 0 0
C24 0 0 0 0 0 0 0 0 0 0 0 -1 0 0 0 0 0 0 0 0 0 0 0 0

Table 3: Adjacency-matrix representation for Cognitive Map in Fig 1.

W1 W11 W21 W31 W41 W51 W61 W71 W81 W91 W101 W111
0,72 0,18 -0,72 0,36 -0,72 0,72 -0,9 -0,72 0,72 0,72 -0,72 0,9
W2 W12 W22 W32 W42 W52 W62 W72 W82 W92 W102
0,9 -0,72 -0,54 0,72 -0,18 -0,72 0,72 -0,72 0,72 0,72 0,72
W3 W13 W23 W33 W43 W53 W63 W73 W83 W93 W103
0,54 0,9 0,9 0,54 0,18 0,54 -0,18 -0,72 0,54 0,72 0,54
W4 W14 W24 W34 W44 W54 W64 W74 W84 W94 W104
0,72 -0,18 0,72 0,36 0,72 0,18 -0,36 -0,54 0,54 -0,18 0,54
W5 W15 W25 W35 W45 W55 W65 W75 W85 W95 W105
0,54 0,72 0,72 -0,18 -0,9 0,54 -0,36 -0,54 0,72 0,54 -0,72
W6 W16 W26 W36 W46 W56 W66 W76 W86 W96 W106
0,72 -0,36 0,54 -0,18 -0,9 -0,54 -0,54 -0,54 0,54 0,54 0,9
W7 W17 W27 W37 W47 W57 W67 W77 W87 W97 W107
-0,72 -0,54 -0,18 0,72 -0,72 -0,36 0,72 -0,72 -0,54 0,36 0,72
W8 W18 W28 W38 W48 W58 W68 W78 W88 W98 W108
0,9 -0,54 -0,54 -0,54 -0,9 0,36 -0,9 -0,18 -0,54 0,36 0,54
W9 W19 W29 W39 W49 W59 W69 W79 W89 W99 W109
0,54 -0,18 -0,54 0,18 -0,54 0,18 -0,9 0,72 0,54 0,72 -0,18
W10 W20 W30 W40 W50 W60 W70 W80 W90 W100 W110
0,72 0,9 -0,36 0,36 0,72 0,72 -0,9 -0,9 -0,72 0,72 -0,9

Table 4: Weight matrix for Fuzzy Cognitive Map, in Fig 1.

In our FCM, weights W23 to W30 represent the degree of direct influence that
vulnerability (C5) can have to potential threat minimization (C4), probability for a
critical situation to occur (C6), the possible predictability that the critical situation

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can have (C7), the controllability (C10), the destructive potential (C11), the
possible scope of impact that the critical situation can have (C12), the adverse
conditions of communication (C14) and the stakeholders’ subjectivity (C15). Other
concepts are analyzed in the same manner. The final results concern the
interactions that possible changes in concepts’ influence can have in the
vulnerability, in the scope of impact and in control of damage concepts.

5. Conclusions

Following the presentation and construction of a CM and an FCM model, we

attempted to analyze the possible relationships and effects between crisis
characteristics and basic crisis management techniques. The concepts that we
mainly examined are the vulnerability that an organization may have and how it
can be influenced by the crisis characteristics as well as by the crisis management
techniques and the scope of impact that a critical situation can have in the
organisation after its end. We also examined how crisis characteristics and crisis
management techniques can affect the control of damage and the prevention of the
situation from getting worse during, or after the end of crisis. The model that we
introduced can be used as a general matrix for examining certain critical situations
and how their characteristics can be influenced by the basic management
techniques that we examined and may trigger further investigation on the temporal
evolution of crisis elements as a result of changes in crisis causes.

6. References

A. S. Andreou, N. H. Mateou and G. A. Zombanakis (10th April, 2004), “Soft

Computing for Crisis Management and political decision Making: The Use of
Genetically Evolved Fuzzy Cognitive Maps”
Bart Kosko (1986), “Fuzzy Cognitive Maps”, Academic Press Inc., London
Christine M. Pearson and Judith A. Clair (Jan., 1998), “Reframing Crisis
Management”, Academy of Management Review, 23(1), 59-76.
Harold Kerzner, PH. D, “Project Management: A Systems approach to Planning,
Scheduling and Controlling”, (10th Edition), Chapter 24, Managing Crisis
Projects.
John F Preble (1997), “Integrating the Crisis Management Perspective into the
Strategic Management Process”, University of Delaware, Journal of
Management Studies.
Peter Hwang, J.David Lichtenthal (1999), “Anatomy of Organizational Crises”, ISBM
Report, Pennsylvania State Universtiy.
Uriel Rosenthal and Alexander Kouzmin (1997), “Crises and Crisis Management:
Toward Comprehensive Government Decision Making”, Journal of Public
Administration Research and Theory.
Wei-Tsong Wang and Salvatore Belardo (2005), “Strategic Integration: A
knowledge Management Approach to Crisis Management”, Proceedings of the
38th Hawaii International Conference on System Sciences.

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AA032

Two-Party Risk Assessment and Allocation Model

Awad S. Hanna
(Professor, Dept. of Civil and Environmental Engineering, Univ. of Wisconsin-
Madison, Madison WI, US.)

Justin R. Swanson
(Master of Science, Dept. of Civil and Environmental Engineering, Univ. of
Wisconsin-Madison, Madison WI, US.)

Abstract
Over the past few decades, numerous research efforts have been undertaken
concerning the allocation of construction risks. Nevertheless, industry participants
remain concerned over the current practice of risk allocation/misallocation within
construction contracting. Based on this problem, a research product that would aid
contracting parties in determining how each risk can best be identified, assessed,
and allocated was developed. The risk allocation model is called the “Single-Party
Risk Assessment Worksheet” and is to be used internally to facilitate risk alignment
within each party’s organization. The results are later compared in the “Two-Party
Risk Assessment Worksheet” in order to begin the cooperative assessment and
allocation process. This paper presents the risk assessment tools developed and the
details of the worksheets.

Keywords
Project management, Risk analysis, Construction risk

1. Introduction

Risk – defined in Webster’s dictionary as “The possibility of loss or injury or

someone or something that creates or suggests a hazard” – is a reality that every
construction company faces on a daily basis. Construction companies often realize
risk at an elevated level due to the high risk nature of the business. As a result,
allocation of risk in the construction industry is often a controversial process with
each party attempting to avoid as much risk as possible by drafting or negotiating
favorable, biased contract terms. This aversion mindset often results in risk being
misallocated to inappropriate parties. Contractual misallocation of risk is cited as
the leading cause of construction disputes in the United States (Megens (1997));
(Smith (1995)).

Some risks are best dealt with through direct contract language, while other risks
are best dealt with through project execution and performance. Due to the need
for a standardized risk allocation process, this paper aids contracting parties in
determining how each risk in a construction contract can be successfully identified,
assessed, and allocated.

2. Research Methodology

In order to provide owners and contractors with a research product that would
serve to identify, assess, and appropriately allocate construction risks, a strict
research methodology was undertaken. The research methodology set forth was a
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two-fold process: the data collection methodology and the model development
methodology. Fig. 1 provides an overview of the overall research methodology.
The bolded boxes represent the primary data collection results, while all dashed-
line boxes signify outside consultation initiated by the author to finalize data
collection results and various model components. It should be noted that this
research was conducted under the guidance of the Construction Industry Institute
Research Team 2010 (CII).

Literature Brainstorming
Review Session
Constant
Allocation Lack of Financial
Education Impacts
Data Collection Concept
Revealed Quantified
Annulled
Initial Web-Based Phone
Questionnaire Survey Interviews

CII Research CII Research

Team Input Team Input
Model
List of 107 Industry Development
Risks Experts Input
Established
Model Development Goal: Achieve Risk Alignment,
Top 14 Risks Identification, Analysis, Action, and Response
Identified Risk Allocation
Principles

Industry
Experts Input Risk Allocation Risk
Tools Assessment
Worksheets
CII Research
Team Input

CII Research List of 107 Risks Risk Rating

Team Input Matrices

Industry Decision Trees

Experts Input

Contract Language
Legal Research Tables

Fig. 1: Research Methodology Flow Diagram

3. Model Development Methodology

After the multiple phases of data collection were complete, the structure of the risk
assessment and allocation model was formed by establishing four phases: risk
alignment, risk identification, risk analysis, and risk action. Subsequently, the
“Single-Party Risk Assessment Worksheet” was developed to be used internally to
facilitate alignment within each party’s own organization. After each party has used
a single-party worksheet, their individual assessments can be automatically
compared in the “Two-Party Risk Assessment Worksheet” to begin the cooperative
assessment and allocation process.

4. Risk Identification

Risk identification is a two-party process that involves identifying risks that have
the potential to be inappropriately allocated and documenting their possible time
and cost impacts. This research identifies 107 risk factors along with their
definition.

5. Risk Analysis

Risk analysis is the single-party and two-party process of assessing each identified
risk and determining its specific attributes and characteristics. In this model, risk
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analysis is performed by assessing five primary attributes of each identified risk:

(1) Likelihood of Risk Realization (L.O.R.R), (2) Relative Impact (R.I), (3) Risk
Rating = L.O.R.R x R.I, (4) Risk Rating Disagreement = Party 1 Risk Rating – Party
2 Risk Rating, and (5)Combined Risk Rating = Party 1 Risk Rating x Party 2 Risk
Rating.

5.1 Likelihood of Risk Realization (L.O.R.R)

The likelihood of risk realization is assigned using a numerical value from zero (0)
to five (5). Zero (0) indicates that the risk is not applicable to the project, one (1)
indicates that the risk has a very low chance of occurring (<10%) and five (5)
indicates that the risk has a very high chance (>90%) of occurring.

5.2 Relative Impact (RI)

The RI of a risk is assigned using a numerical value from zero (1) to five (5). Zero
(0) indicates that the risk is not applicable to the project, one (1) indicates that the
impact would be negligible and five (5) indicates that the risk would have a severe
impact on the project.

5.3 Risk Rating

The risk rating is the product of the LORR and the RI of the risk. The value of risk
rating can range from a minimum of one (1) to a maximum of twenty-five (25). A
rating of one (1) indicates a low likelihood of risk realization (LORR) and a low
relative impact (RI), while a rating of twenty-five (25) indicates a high likelihood of
risk realization and a high relative impact.

The risk rating value helps the single-party user assess which risks have more
potential for inappropriate allocation and therefore which risks should be given the
highest priority to optimize allocation.

5.4 Risk Rating Disagreement

The risk rating disagreement is the absolute difference between the two parties’
individual risk ratings for the risk. This different represents the degree to which the
two contracting parties disagree on the importance of a risk. A large risk rating
disagreement may indicate that one of the contracting parties possesses
information that the other contracting party is unaware of.

5.5 Combined Risk Rating

The combined risk rating is the product of party 1 and party 2 risk ratings. The
purpose of calculating the combined risk rating is to identify the risks that both
parties feel are in need of high attention and concern so that they can be brought
to the table for balanced discussion and appropriate allocation.

6. Risk Action

After risk analysis, risk action needs to take place. Risk action can be defined as a
two-party process of developing and recommending actions to enhance probability
for project success.

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7. Single-Party Risk Assessment Worksheet

The single-party risk assessment worksheet is used for internal risk alignment
within the contracting party. In this case, single-party means that each party will
individually fill out its assigned worksheet, “party 1 risk assessment worksheet” or
“party 2 risk assessment worksheet”. The contracting party initiating the application
of the risk assessment worksheets, typically the buyer entity, should use the “party
1 risk assessment worksheet”, thus taking on the title of “party 1”. The remaining
party will use the “party 2 risk assessment worksheet”.

7.1 The Six Sections of the Single-Party Risk Assessment Worksheet

The single-party risk assessment worksheets are broken into six different sections:
(1) Datasheet, (2) List of Risks, (3) Risk Assessment, (4) Buyer Decision Tree, (5)
Seller Decision Tree, and (6) Risk Allocation Principles. The last three are outside
the scope of this paper. Each of these six sections has a separate spreadsheet
within the single-party risk assessment worksheets.

7.1.1. Section One: Datasheet

The datasheet section contains information on the project name, title of party 1,
date of assessment, purpose of assessment, estimated project cost and time, and
timing of assessment. The “purpose of assessment” will either be for a single-party
(internal) assessment or a two-party (cooperative) assessment.

7.1.2. Section Two: List of Risks

The “List of Risks” section initially allocates 50 rows so that the user can enter a list
of customized risks if so desire. If more rows are required, they can be inserted by
“right clicking” and inserting. Some contracting parties may find it more
manageable to create a customized “List of Risks” for each project.

7.1.3. Section Three: Risk Assessment

The third section of the worksheet is where the single-party internal assessment of
risks is accomplished.Fig.shows the initial view of the risk assessment section of the
worksheet.

Fig. 2: Initial View of the "Party 1 Risk Assessment" Section

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The contents of the risk assessment section are:

1. Column 1 – List of Risks

This column is automatically filled in when the “List of Risks” in datasheet
section is exported.
2. Column 2 – Risk Applies?
This column allows the individual user to track which risks apply to the project in
question and which ones do not.
3. Column 3 – Contract Risk?
This column provides a means for the user to track which risks can and cannot
be effectively allocated via direct contract language.
4. Column 4 – Likelihood of Risk Realization (LORR)
This column is where the user will give each risk a value of 0 to 5 for the
likelihood that the risk will occur or materialize during the project life cycle.
5. Column 5 – Relative Impact (RI)
This column is where the user will assign a relative impact value that will be
realized if the risk materializes.
6. Column 6 – Risk Rating (RR)
This column will automatically fill in with the product of the LORR and RI from
columns 4 and 5, respectively.
7. Column 7 – Expected Value of the Risk
This column is set aside for the user to manually enter the expected value of the
risk. The expected value is equal to the LORR in terms of actual percentage (%)
multiplied by the RI in terms of actual cost or time.
8. Column 8 – Recommended Action
This column is where the individual user will internally determine by what means
each risk should be appropriately allocated.
9. Column 9 – Risk Allocation Recommendation
Column 9 will record which contracting entity will assume the risk according to
the recommended action specified in column 8.
10.Column 10 –“1-5” Risk?
This column is reserved to indicate if the party has assessed a risk as a “1-5”
risk, meaning the user has given a risk a LORR of one (1) and a RI of five (5).
The cell in column 10 will received a red “X” if a “1-5” risk is detected. The
reason for “red-flagging” this type of risk is that, although this risk has a very
low likelihood of occurrence, it will have extreme impacts if it does materialize.
11.Column 11 – Comments
This column is reserved for comments that the user may have concerning each
particular risk.

8. Two-Party Risk Assessment Worksheet

The purpose of the two-party assessment worksheet is to conduct external risk

alignment for a particular project and decide which risks are worth extra external
efforts in determining optimum allocation and which risks can be left as stated or
inferred in the contract documents. Before the two-party risk assessment
worksheet is applied, completed versions of the “Party 1” and “Party 2” worksheets
from the previous “Single-Party Risk Assessment Worksheet” will need to be
obtained by the party that will be managing the two-party assessment (typically the
buyer party).

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8.1 The Three Sections of the Two-Party Risk Assessment

Worksheet

The two-party risk assessment worksheet consists of three distinct sections: (1)
Datasheet, (2) Two-Party Risk Assessment, and (3) Risk Allocation Principles. Each
of these three sections has a separate spreadsheet within the two-party risk
assessment worksheets.

8.1.1. Section One: Datasheet

With a few exceptions, the two-party worksheet “Datasheet” is very similar to the
single-party worksheet “Datasheet”. The datasheet section contains information on
the project name, title of party 1, date of assessment, purpose of assessment,
estimated project cost and time, and timing of assessment. However, the “purpose
of assessment” is “Two-Party (Cooperative) Assessment” by default and the
“Timing of Assessment” options are limited.

8.1.2. Section Two: Two-Party Risk Assessment

The second section of the two-party risk assessment worksheet is where the two-
party assessment of risks is accomplished. This section is the most integral portion
of the two-party risk assessment worksheet. Figure 3 shows the initial view of the
“Two-Party Risk Assessment” section of the two-party risk assessment worksheet.

Figure 3: Initial View of the "Two-Party Risk Assessment" Section

The contents of section two are as follows:

1. Column 1 – List of Risks

This column is automatically filled in with the “List of Risks” from the party 1 risk
assessment worksheet “2. List of Risks” section. Subsequently, if the “List of
Risks” was properly developed and transferred between the party 1 and 2
worksheets, all three worksheets will contain the exact same “List of Risks” in
the exact same rows.
2. Column 2 – Party 1 Risk Rating

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This column automatically references the risk rating from the party 1 risk
assessment worksheet for each particular risk.
3. Column 3 – “1-5” Risk?
If party 1 assesses a risk as a “1-5” risk, this column will indicate this with a red
“X”. This will ensure that both parties are aware of all party 1 “1-5” risks.
4. Column 4 – Party 2 Risk Rating
This column automatically references the risk rating from the party 2 risk
assessment worksheet for each particular risk.
5. Column 5 – “1-5” Risk?
If party 2 assesses a risk as a “1-5” risk, this column will indicate this with a red
“X”. This will ensure that both parties are aware of all party 2 “1-5” risks.
6. Column 6 – Risk Rating Disagreement
This column computes the risk rating disagreement. The maximum
disagreement possible is 25. This extreme situation occurs when one party feels
that the risk does not apply to the project, while the other party not only thinks
that the risk applies but assigns it a five (5) for both LORR and RI.
7. Column 7 – Combined Risk Rating
This column computes the combined risk rating. The combined risk rating is the
product of the party 1 and party 2 risk ratings (Combined Risk Rating = Party 1
Risk Rating x Party 2 Risk Rating). The maximum possible value is 625, and
occurs when both parties assign a five (5) to both the LORR and RI for a
particular risk.

8. Column 8 – Party 1 Risk Allocation Recommendation

This column will automatically fill in with the recommendations contained in
column 9 of the party 1 risk assessment worksheet.
9. Column 9 – Party 2 Risk Allocation Recommendation
This column will automatically fill in with the recommendations contained in
column 9 of the party 2 risk assessment worksheet.
10.Column 10 – Comments
This column is reserved for comments that the contracting parties may wish to
make concerning the two-party assessment of each particular risk.

8.1.3. Section Three: Risk Allocation Principles

The third section of the two-party risk assessment worksheet contains risk
allocation principles, and is beyond the scope of this paper.

8.2 Interpreting Two-Party Worksheet Notification

The two-party risk assessment worksheet has several different means by which the
contracting parties are notified of risk issues that need the most cooperative
attention to ensure appropriate allocation: (1) “1-5” risk red-flagging, (2) Risk
rating disagreement, (3) Combined risk rating, and (4) Recommended risk
allocation comparison.

Multiple notifications may occur within the two-party risk assessment worksheet for
the same risk. Contracting parties need to be aware of how to interpret the
different notification scenarios that may arise when using the two-party risk
assessment worksheet. Severe conflicts require a discussion between parties to
insure that the risk is properly allocated.

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9. Conclusion

It is clear that optimum risk allocation is highly dependent on project-specific

circumstances and participants. Recognizing these industry needs, a model called
“Single-Party Risk Assessment Worksheet” was developed to allow the participants
to perform internal risk alignment before contracting. Also, a model called “Two-
Party Risk Assessment Worksheet” was also developed to allow participants to
perform external risk alignment.

Construction will always have risk associated with it. However, careful drafting of
construction contract clauses can allocate risk where it appropriately belongs,
thereby eliminating some of the uncertainty and legal argument of common law
principles.

10. References

Megens, P. (1997) “Construction Risk and Project Finance - Risk Allocation as

Viewed by Contractors and Financiers”, The International Construction Law
Review, 14(3), 5-32.
Smith, R.J. (1995) “Risk Identification and Allocation: Saving Money by Improving
Contracts and Contracting Practices.” The International Construction Law
Review, 12(1).

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ITPM1

The use of Project Management Systems in Road Construction

Projects:The case of the EGNATIA motorway

Thanassis Iatropoulos
(Information Technology Manager, EGNATIA ODOS S.A., Thessaloniki, Greece)

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W08
Absence of Corporate Environmental Disclosure (CED) in Libya:
A Research Note

Adel Ishwerf
(School of the Built Environment, University of Salford, UK)

Prof: David Eaton

(School of the Built Environment, University of Salford, UK)

Abstract
Corporate Social and Environmental Disclosure (CSED) was one of the main topics of argument in the literature,
particularly in the 1970s and 1980s. Since the early 1990s, the emphasis has been shifted to Corporate
Environmental Disclosure (CED) rather than Corporate Social Disclosure (CSD). CED practice has become a topic of
investigation among accounting academic researchers in both developed and developing countries. The literature
has identified that the level of practices in CED in developing countries is lagging behind the developed countries.
However, it is worth mentioning that pressures for CED vary from country to country and from region to region,
especially between developing and developed countries. This paper presents an in-depth investigation of group of
stakeholders’ perceptions towards CED in Libya and concentrates upon the absence of CED in Libya. It has
identified disincentives for CED in Libya. Evidence is collected from in-depth interviews with thirty interviewees from
six groups of stakeholders namely: Decision Makers, Local Government, Financial Institutions, Shareholders,
Managers, and Employees. The findings suggest that there is a strong consensus between the six groups surveyed
on a number of disincentives for CED.

Keywords
Corporate Environmental Disclosure, Corporate Social Disclosure, Stakeholder,
Shareholder.

1. Introduction

One of the most significant current discussions in economic, management and accounting literature and has received
much attention from researchers is Corporate Social and Environmental Disclosure (CSED) (Ahmad, 2004, De
Villiers, n.d, Jaggi and Zhao, 1996). Corporate Social Disclosure (CSD) including environmental disclosure was one
of the main topics of argument in the literature, particularly in the 1970s and 1980s (Ahmad, 2004, Ince, 1998,
Mathews, 1997, Niskala and Pretes, 1995). However, in the early 1990s, the main concern has been Corporate
Environmental Disclosure (CED) rather than CSD (Ince, 1998, Lodhia, 2005).
Jaggi and Zhao, (1996) list two basic arguments of social and environmental responsibility behaviour from
organisations. The first argument “relates to the concept of social contract”. The second debate “relates to quality of
life”. They add to these arguments “increased stakeholders’ awareness”, and thus several countries have forced
business to become more responsible for a cleaner environment. As a result, Corporate Social and Environmental
Disclosure has become an important tool to demonstrate companies’ commitment to the environment which is the
initial goal of much environmental reporting (Azzone et al., 1997). In addition, Hope, (2003) states that, Corporate
Social and Environmental Disclosure is different among countries. The literature of social and environmental
disclosure involves stakeholders or external users companies (Tilt, 2003). Literature has also emerged that some
stakeholders, such as banks, insurance companies, etc., are seeing environmental disclosure as highly incomplete
(Azzone et al., 1997).
As a result of this awareness, stakeholders are demanding improved environmental disclosure and better
environmental performance. Azzone et al., (1997) suggest that these problems can be solved by clearly identifying
the key stakeholders. That means identify for whom the environmental reports are published and what are their
environmental information requirements. They add that companies must produce clear and effective environmental
reports for external users, since, social and environmental reporting might be influenced by stakeholders (Tilt, 2003).
Mashat, (2005) states that, corporate reporting and disclosure practices might be influenced by the individual’s
attitudes behaviour and values it is therefore necessary to specify the stakeholder “target” for particular CSED
reports.
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The variation in awareness of different stakeholders of corporate social and environmental disclosure has been
investigated in a number of studies (e.g. Al-Khater and Naser, 2003, Azzone et al., 1997, Danastas and Gadenne,
2004, Deegan et al., 1995, Epstein and Freedman, 1994, Filios, 1998, Lodhia. 2003, Mashat, 2005, Mashat et al.,
2005, Naser et al., 2003, O’Dwyer, 2002, Tilt, 1994, Tilt, 2003). Most of these studies have covered developed
countries and little has been published in the developing world in general and in the Arab region in particular.
Although, the presentation of environmental information has been increased in annual reports due to the demand by
stakeholders, Libyan organisations have not shown any great interest in providing environmental information as is
evident from studies undertaken by Mashat (2005) and Ahmad (2004). Ahmad’s (2004) study was the first detailed
longitudinal study of CED undertaken in Libya. However, he concluded that disclosure of environmental information
is not common in annual reports of Libyan corporations.
This paper aims to broaden the present CED literature by considering attitudes towards CED within the context of a
developing country and with specific regard to the corporate unwillingness to disclose environmental information. The
next section of the paper provides the previous studies related to this paper and is followed by the research
methodology adopted in the collection and analysis of data. The paper then presents the findings and concludes.

2. Prior Literature

Within the social and environmental disclosure literature a number of studies explicitly comment upon disincentives
of corporate social and environmental disclosure. This section considers theoretical explanations about the reasons
for non-disclosure from the prior literature.
There are some studies that explicitly number the reasons for the absence of disclosure, the empirical available
evidence in this area is limited, Solomon and Lewis (2002) justify that company management do not openly discuss
their perceived inadequacies. It still seems to be limited to the willingness to communicate corporate social and
environmental disclosure. An understanding of the reasons for the absence of environmental disclosure will allow
interested parties such as government agencies to develop policies to mitigate these inadequacies. Gray et al.,
(1993) lists the following reasons for the absence or inadequate CED: absence of any demand for information;
absence of a legal requirement; the problem that the cost would outweigh the benefits; and the possibility that the
companies had never considered it. The World Industry Council for the Environment (WICE, 1994; cited in Solomon
and Lewis, 2002) explains that competitors may be a good reason for companies to exclude certain information.
Adams (2004) reports that the cultural attitude within a country was an important factor for non-disclosure. Gao et al.,
(2005) explains the low level of CS and ED in Hong Kong because there was no strong pressure from community
pressure groups and also an absence of social and environmental legislation. However, Kuasirikin and Sherer (2004)
argue that there were many reasons for the absence of CS and EDs in Thailand. These reasons included: a failure to
enforce legislation; a lack of effectiveness by Thai social and environmental pressure groups; and an absence of
mandatory social and environmental disclosures. The importance of an absence of compulsory CS and EDs by law
has been noted by Adams et al., (1995) and also suggested by Naser and Abu-Baker (1999) as the primary reason
for an absence of CSD in Jordan.
Teoh and Thong (1984) suggest that a desire to keep the annual report brief and a degree of secrecy about the
company’s activities are reasons for non-disclosure in developing countries. Belal and Cooper (2007) also suggest
that the lack of reporting of good news could be a reason for the lack of CSED. Solomon and Lewis, (2002)
investigate the reasons for the disincentives of CED in the UK using a questionnaire. The questionnaire was
distributed to 625 individuals and organisations, divided into three sub-sample groups namely, a normative, an
interested party and a company group. The findings (Table 1) show that a number of reasons attracted high scores
from each group. There is a strong consensus between the three groups on a number of disincentives for CED.
Interested party
Normative group Company group
Reason group
N Mean N Mean N Mean
Reluctance to report sensitive information 87 4.18 86 4.23 78 4.03
To avoid providing information to competitors 87 3.82 86 3.73 79 3.75
To avoid providing incrimination to regulators 87 3.78 88 3.83 79 3.44
Possible damage to companies’ reputation 86 3.92 87 4.06 79 3.57
General lack of awareness of environmental issues 86 4.06 88 3.80 79 3.42
Inability to gather the information 86 3.77 88 3.48 80 3.56
Cost of disclosure 87 3.79 89 3.72 81 3.57
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Lack of awareness of competitive advantage 84 3.52 86 3.19 79 3.18

There is no legal obligation for companies to report environmentally 87 4.01 87 4.12 80 4.03
Companies generally believe they do not have an impact on the environment 87 2.79 87 2.78 79 2.54
Insufficient response/feedback from stakeholders 86 3.30 78 3.40 81 3.47
Users may not understand the information 86 2.98 88 2.77 79 3.32
Table 1: Possible Reasons for the Inadequacy of Corporate Environmental Disclosure
Source: (Solomon and Lewis, 2002, p.162)
Belal and Cooper (2007) carried out study concentrated upon the lack of CSD via in-depth semi-structured interviews
in 23 companies across ten industrial sectors in Bangladesh. They conclude that the main reasons for non-disclosure
included: lack of legal requirements; lack of knowledge/awareness; poor performance and fear of bad publicity; and
lack of resources of small companies.
This section has provided a review of both the theoretical and empirical literature on disincentives of CED. Most of
the previous studies have undertaken empirical investigations of levels of social and environmental disclosures within
annual reports and how these are related to the presence or absence of a number of factors. In contrast a smaller
number of studies have addressed reasons for non-disclosure of CED within annual reports through seeking the
perceptions of managers and fewer still through the views of users or stakeholders. Most of them investigated the
perceptions through using a questionnaire methodology. However, smaller numbers used an interview methodology
for examining the views of stakeholders which has been adopted in this study from the context of developing
countries for the study of the perceptions of various groups of stakeholders towards CED.

3. Research Method
This paper adopts a pure qualitative research method. The rationale for the choosing of a qualitative approach stems
from the nature and context of the study. Researchers used qualitative research when they seek to understand the
context the study matter in terms of how and why it occurs (Cassell and Symon, 1994) and when the study
phenomena is emergent rather than prefigured (Creswell, 2003). This paper reports on a study of stakeholders’
perceptions concerning the current state and the absence of CED in Libya. The evidence in this paper was collected
using face-to-face (FtF) semi-structured, in-depth personal and representative interviews with 30 stakeholders from
six groups of stakeholders in Libya between mid December 2008 and March 2009. These stakeholder groups
include: Decision Makers; Local Government; Shareholders; Managers; Employees; and Financial Institutions. These
groups have been chosen because they have a direct relationship with the company. That means the company
cannot survive without these groups of stakeholders. The particular interviewees were chosen on the basis that they
have knowledge about CED or they are responsible for handling environmental information. The interview questions
were in Arabic because the official language in Libya is Arabic. One part of the interview was devoted to
understanding the current level of CED in Libya. The second part of the interview was devoted to developing a critical
understanding of the reasons for non-disclosure of environmental information.
A phone call was made to the organisations or individual stakeholders requesting an interview with the individual who
had knowledge about the subject of this paper. Most of the contacts were made through this process. The internal
stakeholders (Managers and Employees) were from the Ahlia Cement Company. This has been chosen for some
reasons. These reasons including:
 The Ahlia Cement Company is a joint-stock company registered on the stock market in Libya. It was a
public company until 2005;
 The Ahlia Cement Company is the unique cement company in the west of Libya;
 This company is widely recognised as being amongst those with the greatest environmental problems and
having the greatest expenditure on pollution control. De Villiers and Barnard (2000) and De Villiers and
Lubbe (2001) indicated that, companies that have an obvious environmental impact according to the notion
of legitimacy, are more likely to disclose more environmental information in an effort to legitimise
themselves (their aims and methods) in the eyes of society and will therefore be more inclined to use
environmental disclosure than other companies that have a less obvious impact. Thus, environmental
information within this company has greater potential usefulness to its stakeholders than information from
firms in non-environmentally sensitive industries. Cement companies have a greater need to legitimise their
operations by means of environmental disclosure, because their environmental impact is extensive and
obvious;
 The Ahlia Cement Company was the first cement company in Libya and it is one of the largest companies in
Libya and it has six plants with sites across Libya. García-Ayuso, and Larrinaga, (2003) stated that, it could
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be argued that larger firms are subject to stronger pressure from stakeholders. Moreover, Saunders et al.,
(2003, P.261) point out that “the single case may in fact encompass a number of settings, where for
example it involves a study in a large organisation with sites across the country or even around the world”.
Gray et al., (1995) gave three reasons for using a sample of the largest companies. One of these reasons
is: the largest companies are more likely to disclose environmental information than medium and small
companies. In addition, some researchers indicated that certain industries, such as the mining, and larger
companies consistently disclose more environmental information than smaller companies or companies in
other industries (Gray et al., 1995, Hackston and Milne, 1996);
 The Ahlia Cement Company has commenced the procedure for obtaining ISO 14001; and
 The company is chosen because the headquarters of the company situated in Khums city which is near
where the researcher lives. This feature allowed the researcher to contact them easily and considerably
reduce travelling time.
The interviews were conducted at the interviewees’ place of business during the period of December 2008 and
March 2009. The interviews involved two steps. The first step was contacting and making appointments with
interviewees in a suitable interviewing environment (time and the place of interviews according to interviewees
preference, which may be placed in their offices or elsewhere). The second step was the interviewing process
starting with a brief introduction and explanation about the research. Twenty six interviews were recorded with the
permission of the interviewees and notes were taken during all interviews and later the notes were confirmed by the
interviewees. In addition, all interviewees signed the consent form of the Ethical Approval for using the collected data
in this research. A promise of anonymity was given to all interviewees. After each interview, the researcher thanked
the respondents. All interviews were transcribed immediately afterwards.
Collis and Hussey (2003) consider that there are two different approaches for analysing qualitative data. One
approach is to quantify the data, either formally or informally. In other words, turn the qualitative data into numerical
data. Another approach is to non-quantify the data. Following a reiterative process suggested by O'Dwyer (2004)
interview transcripts and notes were then summarised and analysed thematically together with personal reflections
by the authors using NVivo version 8. Before using NVivo primary analysis of the data collected was undertaken. The
primary analysis of the data collected was a four-step process. Each interview was transcribed to the Arabic
Language in a Microsoft Word 2007 document format almost entirely, leaving out only those portions where the
interviewee or interviewer digressed from the research focus completely. The second step was to conduct a
microanalysis of each interview, striving to understand any hidden meanings within the words, phrases, sentences,
and finally paragraphs in each interview that could impact researcher understanding of the data as recommended by
Miles and Huberman (1994). The third step was for each interview to be translated from Arabic to English and effort
was made to keep the original meaning in place. The final step is for all interviews to be transferred and sorted as a
project in the NVivo 8 software.
The secondary analysis using NVivo version 8 developed a system of codes to categorise the detailed data and
facilitate its retrieval through content analysis as Kumar (2005) recommended. The results are reported in the
following section.

4. Findings
This section explores the absence of CED from the context of Libya. In particular, it describes the current state of
CED, the reasons for non-disclosure, the motivations for disclosure, and the factors for enforced CED provided by
interviewees. Firstly, interviewees were required to comment on the current level of ED by a company. Most of the
respondents 22 out of 30 (73%) said that their environmental information was not disclosed by Libyan companies.
However, the remaining interviewees (8 – 27%) thought that there is a clear lack of CED in Libya and half of these (4
– 14%) where from the Decision Makers group. Thus, it can be noted that because some government authorities and
agencies required companies to provide some environmental information in compliance with the 15 Act 2003, this
disclosure is not voluntary disclosure and not all or most stakeholder groups can access this information. The next
section will discuss the reasons for the lack of CED in Libya.

4.1 Reasons for Non-Disclosure of Environmental Information

Table (2) presents the disincentives for CED that are identified by the interviewees. There are some compound
reasons for companies and organisations not to disclose their environmental information. These reasons have be
classified as follows:

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Decision Local Financial Mean

Reasons Makers Government Institutions
Managers Employees Shareholders
%
Lack of legal requirements 80% 100% 100% 100% 80% 100% 93%
Lack of environmental awareness 60% 60% 80% 20% 40% 60% 53%
Lack of knowledge 80% 60% 60% 40% 0% 20% 43%
ED would have an obligation for others 0% 40% 60% 60% 20% 40% 36%
Emphasis on economic performance 40% 20% 20% 20% 60% 40% 33%
Lack of demand 0% 60% 40% 40% 20% 20% 30%
Public lacks the knowledge 20% 40% 40% 20% 40% 0% 27%
Sensitive and confidential 0% 20% 20% 40% 40% 40% 27%
Administrative difficulties 0% 20% 0% 60% 40% 0% 20%
Lack of awareness of helping the government to
0% 40% 0% 0% 0% 0% 7%
solve environmental problems
Lack of competition 0% 20% 0% 0% 20% 0% 7%
Lack of staff 0% 0% 20% 0% 20% 0% 7%
Fear of the decisions of the government 20% 0% 0% 0% 0% 0% 3%
Government agencies are not strict 0% 20% 0% 0% 0% 0% 3%
Lack of awareness of management of the negative
0% 20% 0% 0% 0% 0% 3%
economic aspects
The absence of civil societies 0% 0% 20% 0% 0% 0% 3%
Table 2: Disincentives for Corporate Environmental Disclosure

4.1.1 Lack of Legal Requirements

Like many other countries of the world CED is not a mandatory requirement in Libya. Most interviewees (93%)
expressed the view that the main reason for not disclosing these significant issues is the absence of a legal
requirement. The prevailing managerial attitude is: we will only comply if we are legally bound to do so. The following
quotation is illustrative of this attitude.
“There are no regulatory requirements for companies to disclose their environmental information to users”
(S3).
The above quotation illuminates corporate unwillingness and a lack of sincere commitment in Libyan companies
towards CED. It appears that the absence of mandatory requirements for CED provides Libyan companies with a
convenient pretext for avoiding these serious issues which need to be addressed for the reasons noted earlier. In
order to address these issues businesses would require a fundamental shift in traditional thinking of profit making as
the sole objective. Otherwise, any kind of attention to these issues would be treated as diversion of scarce business
resources and a distraction from the fundamental corporate objective of shareholders’ wealth maximisation.

4.1.2 Lack of Awareness / Knowledge

Given the fact that the phenomenon of CED is comparatively new to the companies in developing countries many of
them may not be familiar with its processes and requirements. More than half of the interviewees shared this view
(16 – 53%). They contended that some of the reasons for non-disclosure might be attributed to lack of awareness
and knowledge amongst corporate managers and the public regarding CED.
“The reason for the absence of CED is the lack of environmental awareness, whether by companies or by
people. I think the media such as TV and newspapers should play the role to increase the environmental
awareness in the people” (DM4).
13 out of 30 interviewees (43%) from all groups of stakeholders except the employee group state that the reason is
also because companies are not concerned about this type of information due to a lack of knowledge.
“I think the lack of knowledge concerning this type of information prevents organisations from disclosing this
information” (DM1).

Moreover, 8 out of 30 respondents (27%) –except from the shareholders group- stated that the general public do not
have enough knowledge about the importance of environmental information. Increasing the knowledge about the
environmental information could lead to demand for this information. This was recognised by some interviewees (13 -
30%). They expressed the reason that there is no explicit demand for environmental information whether internal or
external demand.
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“......the public lacks the knowledge and understanding of the importance of environmental information”
(FI3).
It can be noted that there is an absence of environmental awareness and knowledge in terms of both companies and
the public. Subsequently, there is an absence of the pressure on companies to disclose environmental information.
However, one interviewee from the local government group (3%) added another reason for the absence of CED. This
reason is that the management of companies are not aware of the negative economic impact of non-disclosure.
“Lack of awareness of management of the negative economic aspects as the result of the non-disclosure is
the reason for the absence of CED” (LG1).
Moreover, two interviewees (7%) from the local government group believed that companies do not disclose their
environmental information because the management of companies do not recognise that the government can help
any company to solve any environmental problems. Commenting on this reason he stated:
“I think the other reason for non-disclosure is the lack of awareness of the cooperation that the government
is ready to help any company to solve any environmental problem” (LG1).

4.1.3 Issues Management and Fear of Bad Reputation

Six more factors, which conflict with the lack of awareness suggested above, have been identified for not disclosing.
These relate to the fact that companies were not actually undertaking enough activities for protecting the
environment and that environmental disclosure could bring adverse publicity, particularly if the disclosures are not
positive. Some interviewees (10 - 33%) revealed that one reason for companies not disclosing environmental
information is that companies aim to achieve profit maximization for their shareholder and they are not concerned
about environmental performance. The following comments reveal some of the interviewees’ thoughts regarding this
issue:
“I think another reason is because the objective of the company is to emphasize on economic performance
over environmental performance. In addition, achieving the profits is at the expense of the environment
because the environmental aspect is the only one that could have been avoided and no one is concerned
about it. For example, companies allocate amounts in their budgets for their environmental activities even
though sometimes included under other items. At the end of the fiscal year you will find these allocations
were either under spent or transferred to the following year. Also, sometimes it was spent on other activities
through transfer to other items” (M3).
Moreover, one third of respondents (11 - 36%) from the groups of managers, employees, shareholders, local
government, and financial institutions revealed that the other reason is that management of companies thought if
they disclosed environmental information; it would have an obligation for others against the company. Therefore, this
is an implicit recognition by the company for any environmental damage that may be caused by the company’s
activities to others as a result of its operations. An interviewee from shareholders group and the financial institutions
group provided the following comments:
“Another reason is that the management of the company believes that this information would create an
obligation for others and would have a legal obligation which could force the company to pay sums of
money. So, for that reason they do not disclose environmental information” (S5).
Similarly, (8 - 27%) interviewees from the same groups above believed that companies do not disseminate
environmental information because the management of the companies thought this information was sensitive and
confidential. In other words, this information should be kept secret and should not be read by others especially
external parties. For this, some companies disclose environmental information in their annual reports hidden under
other items. The following response reveals one interviewee’s opinion:
“This kind of information is sensitive and confidential to disclose. Sometimes environmental information is
disclosed in annual reports but it is not clear, because it is hidden among other items” (E1).
In addition, some interviewees (7 - 20%) from the managers, employees, local governments, and financial institutions
groups added another reason among management issues which is administrative difficulties. In the same vein, (2 –
7%) of interviewees from the groups of employees and financial institutions expressed the reason as the lack of staff
who are qualified and have experience on environmental disclosure. The following response reveals some of the
interviewees’ opinions:
“I think another reason is because the lack of staff that are qualified and have the expertise and knowledge
of environmental disclosure” (E4).

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Two interviewees (3%) from the decision makers group mentioned that there is non-disclosure in Libya because the
management of companies fear the decisions that could be undertaken by the government agencies against the
company. The following response reveals these opinions:
“Furthermore, the management of companies fear the decision of the government restricting the activity of
the company if it discloses environmental information such as to increase the taxes” (DM4).

4.1.4 Other Disincentives

There are three other reasons for non-disclosure which were mentioned by one or two respondents. Firstly, 2
interviewees (7%) out of thirty from the groups of employees and local governments expressed that there is no
existing competition in the market that makes companies disclose their environmental information. Companies need
to see the tangible benefits from disclosure and this could happen in the free market. It can be noted that the
economic system in Libya has been changing and the Libyan government has encouraged foreign investors to invest
in Libya. Thus, it has established a Privatisation and Investment Board which aims to supervise the national and
foreign investment in the local market. Moreover, it works to increase the participation of the private sector through
ownership of public companies such as the company that is studied and also to promote the establishment of private
projects. Moreover, it has established a stock market since 2006. Thus, it could be expected that voluntary disclosure
in the following years will be very important.
In addition, one interviewee (3%) from the group of local government mentioned that government agencies do not
play such a strict role against a company that its activities affect the environment. He thought that this could be the
reason for non-disclose. Furthermore, the absence of environmental civil society organisations was revealed by one
interviewee from financial institutions group as a disincentive for disclosure. Environmental civil society organisations
can put pressure on companies to disclose their environmental information such as Friends of the Earth in the UK.
The following comments reveal some of the interviewees’ thoughts regarding these issues:
“Moreover, government agencies which are responsible for protecting the environment are not strict in the
case of the discovery of environmental violations” (LG4).
“The absence of environmental civil society organisations such as Friends of the Earth pressing to preserve
the environment is also a reason for non-disclosure” (FI2).
It can be concluded that there is a strong consensus amongst the six groups surveyed on a number of disincentives
for corporate environmental disclosure. The most important disincentives for CED in Libya in terms of all groups of
stakeholders are: a lack of legal requirements; an emphasis on economic performance; and lack of environmental
awareness. Less important is that: ED would have an obligation for others; a lack of knowledge; sensitive and
confidential information; the public lacks knowledge; and a lack of demand.

5. Conclusion

Based on the paper’s findings, there are several important reasons for non-disclosure. The most important reason for
the absence of CED in Libya is the lack of requirements which could be accounted for the argument that companies
disclose their information to respond to the state institutions in the form of regulation (Jacobs and Kemp, 2002) also,
from non-government organisations (Mangos), in the form of informal regulation (Tilt, 1994). Thus, some countries
have required companies to disclose environmental information in annual reports such as Demark, France, Portugal,
Spain, and Sweden (Fleischman and Schuele, 2006). In Libya neither formal nor informal regulation presently
requires companies to disclose their environmental information. This reason is supported by quite a number of
scholars and previous studies namely: Adams et al., (1995), Ahmad, (2004), Belal and Cooper, (2007), Geo et al.,
(2005), Gray et al., (2003), Kuasirikin and Sherer, (2004), Naser and Abu-Baker, (1999), and Solomon and Lewis,
(2002).
The absence of CED due to lack of awareness and knowledge seems to be a plausible explanation and relevant in
the context of developing countries (Belal and Cooper, 2007). The results show that another main reason in Libya is
the lack of environmental awareness and knowledge in terms of companies and stakeholders. This finding is
consistent with a quite a number of studies that have been concluded with this issue by Belal and Cooper, (2007),
and Solomon and Lewis, (2002). It is true that managers of corporations need training to achieve the required skills
to be able to make CED.
The nonexistence of CED in Libya is caused by some other reasons among of issues management and fear of bad
publicity. Three of these reasons (environmental disclosure have an obligation for others, companies fear of state
agencies decisions, lack of staff and administrative difficulties) are supported by Solomon and Lewis (2002).
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However, the reason that Libyan companies emphasis is on economic performance agrees with Belal (2007) and
Gray et al., (2002). The last factor is that management of Libyan companies thought the environmental information is
sensitive and confidential is supported by Solomon and Lewis (2002) and Teoh and Thong (1984).
Libyan companies do not make CED due to the absence of competition in market and environmental civil society
organisations. The reason of the nonexistence of competitions is in conflict with findings of the study undertaken by
Solomon and Lewis (2002). They conclude that one reason for non-disclosure was to avoid providing information to
competitors. This could be true when the information is negative but if it is positive then it can improve the company
and goods in the market. However, the absence of environmental civil society organisations leads to no strong
pressure from community pressure as result, an absence of CED.
This paper contributes to the CED literature by exploring the disincentives for CED in a developing country context.
The paper demonstrated various issues for the absence of CED in Libya which could help policy makers to
undertake some serious public policy issues by understanding motives for encouraging companies to publish their
environmental information.

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AA082
Construction contracts, project delivery methods and roles of the
project stakeholders. The case of Khalifa port project in Abu Dhabi

Nikolaos Kalyviotis
(Student, Dept. of Civil Engineering, Aristotle University, Thessaloniki, Greece)

Dimitris Kitsios
(Project Controls Manager – Gulf Region, Archirodon Construction (Overseas)
CO.S.A., Dubai, United Arabian Emirates)

Aristotelis Naniopoulos
(Professor, Dept. of Civil Engineering, Aristotle University, Thessaloniki, Greece)

Abstract
The main subject of this paper is to investigate and review the main construction
contracts used in international environment, the project delivery methods and the
roles of the project stakeholders.
The greatest part of information and data were collected with the assistance of the
“Archirodon Construction (Overseas) CO. S.A.”, more specifically with the
assistance of the department based in United Arab Emirates (U.A.E.). The first
author stayed with the aforementioned company in U.A.E. for three months in the
frame of his diploma Thesis.
In the case of Khalifa Port in Abu Dhabi a brief presentation of the involved “actors”
is made and the role of each one is described. Responsibilities are recorded and
presented, as a result of a “structured questionnaire” survey with key personnel
and the contract documents analysis.
It appears that in certain positions the civil engineer is spending more time on
issues not purely related to the main civil engineering discipline. Particularly,
working in management positions in international construction the civil engineer
requires a good knowledge of financial and legal issues.

Keywords
International Construction Contracts, Project Delivery methods, Project Involved
“Actors”, The Khalifa Port Project U.A.E.

1.Introduction

The construction contracts and the project delivery methods are some of the most
important issues for an Engineer. This paper introduces and investigates the main
contract types and the main delivery methods, which an engineer can meet during
his career. Additionally, there is a description of project stakeholders and the case
Khalifa Port project is examined as a case study to show how the previous issues
are applied in practice.

The greatest part of information and data were collected with the assistance of the
“Archirodon Construction (Overseas) CO. S.A.”, more specifically with the
assistance of the department based in United Arab Emirates (U.A.E.). The first
author stayed with the aforementioned company in U.A.E. for three months in the
frame of his diploma Thesis (Kalyviotis, N (2008)). The work was realized by the
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analysis of information, contracts and manuals submitted, also by “structured

interviews” conducted with key personnel of the company is sites.

In the case of Khalifa Port in Abu Dhabi a brief presentation of the involved “actors”
is made and the role of each one is described. Responsibilities are recorded and
presented, as a result of a “structured questionnaire” survey with key personnel
and also the contract documents analysis.

2. Main Construction Contracts

Main types of Construction Contracts are: Lump Sum, Unit Price, Cost Plus and
incentive. These contracts with their subcategories and the Standard Form
Contracts are covering most of the projects.

Lump Sum (also called Fixed fee Contract) is the kind of contract that the
Contractor agrees to construct a certain and described project for a fixed price. A
lump sum contract is appropriate when the scope of the project and the project
planning are defined, so the consultant can easily estimate project’s cost. The
entire risk in lump sum contacts lies on the Contractor and that’s why usually the
risk premium allowed for in these projects is higher.

Unit Price Contract or Re-measurable Contract is based on rated quantities of the

project and the price of each unit of these quantities. The final price of the project
depends on the required quantities for finishing the total project. As it is understood
this kind of contract can be used in cases that the scope of works is defined, but
not the exact size/quantities. Contrary, to the lump sum contracts, the risk here
lays exclusive with the client

Cost Plus Contracts allow clients to agree the total cost of the project works plus an
extra amount as the contactor’s profit. This kind of contract is used when the type
of work is not specified or the risk is too high. That’s why there are many
subcategories of cost plus contracts too. The main subcategories are:
Cost & Fixed Percentage Contract: the compensation is standard based on the total
cost of the project, but the contractor takes extra an agreed percentage for each
activity.
Cost & Fixed Fee Contract: the contactor’s compensation is standard regardless of
the total cost of the project. Client agrees to cover the real cost of the project and
further on to give an agreed fee to the contractor.
Cost & Fixed Fee with Guaranteed Maximum Price Contract: it is the same case as
before the only difference is that the total cost of the project will not exceed an
agreed maximum price.
Cost & Fixed Fee with Bonus Contract: as in the previous cases contactor’s
compensation is standard, but there is a bonus, if the project meets certain goals
(i.e. budget is reduced or if the project’s time is reduced etc.)
Cost & Fixed Fee with Guaranteed Maximum Price Contract and Bonus Contract: is
a combination of the two previous contracts.
Cost & Fixed Fee with Agreement for Sharing Any cost Savings Contract: is the last
case, where the client and the contractor share the excess of money.

Contract incentives refers to monetary or non-monetary motivators embodied in

or arising from the terms and conditions of the contract that influence the behavior
of the buyer and seller towards accomplishing desired contractual outcomes.

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Incentives should be positive but balanced, when necessary, with remedies for
missing specific program targets or objectives.
A fixed-price incentives contract contains a target cost, a target profit, a price
ceiling, and a formula by which stockholders will share any differences between
target costs and actual final costs, as negotiated.
Cost Reimbursement Incentives contract provides for payment to the contractor of
allowable costs incurred during performance; that is, the final amount payable by
the client and is determined by the contractor's actual cost experience.

Standard Form Contract is the kind of contract that does not allow for negotiation
between the stakeholders. These contracts were drafted either from organizations
or companies or federations. There are three well-known types of standard form
contracts FIDIC (International Federation of Consulting Engineering), ICE
(Institution of Civil Engineering) and NEC (New Engineering Contract).

The FIDIC contract documents (www.fidic.org (2010)) are the most used contracts
worldwide. The main advantages of the FIDIC contracts are the followings:
 It is an international Contract, as it used in many countries and it is
translated in twelve languages.
 The documents are accompanied from a rich literature and case-law.
 The risks are balanced between the stakeholders.
 It is adopted from European Union and other international organizations (The
World Bank, etc) for funding projects.
The main disadvantages of the FIDIC contracts are:
 There is unevenness between the contract terms of private and public filed
 The dependency between the terms makes the changes difficult and time-
consuming.
 The provisions about the subcontracting is very limited
 Finally in the term 5.2 the phrase “…indemnity of the contractor against and
from any negligence or misuse of goods…” has many traps, as the term
“goods” is not specified and the radius of the possible losses is huge, also the
term “any negligence” covers almost everything.

The ICE contract documents are the base for FIDIC contracts. They were developed
by the British Institution of Civil Engineering in United Kingdom before FIDIC. The
ICE is not as developed as FIDIC and it is very rare to meet them (www.ice.org.uk
(2010)).

New Engineering Contracts have a heavy legal character, although the simplicity of
their writing makes them very simple to use. The leadership of these contracts is
that they are not just a simple form of contract, but a family of contracts that
includes many project cases. So someone can use the included contracts to mold
the final form of the contract. They are better than FIDIC in small projects and in
projects that have many phases (www.neccontract.com (2010)).

3. Main Project Delivery Methods

There are many project delivery methods, which were developed during the last
twenty years. The distinction between them is a result of the separation of different
risks and subjects, but also from who owns the fixed amounts. The three main
project delivery methods are Design – Bid – Build, Fast Track and Turnkey and
some other, not so popular are presented here (Kalyviotis, N (2008)).

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The most popular method is Design – Bid – Build (D.B.B.) being an agreement
between the client and the contractor. This way a lot of time is saved as the
consultant is not involved. Traditionally, the construction of the project does not
begin before the architect completes and finalizes the study. This sequence
dominates in the construction industry and it is known as D.B.B. During this
procedure when the first step is completed then the next starts. This can be
accepted by some clients, but it is not suitable to others, because of the time and
cost implications.

Fast Track refers to the overlap of the project study and the construction phases.
The contracts of these projects are called phased construction, because as the
design of the progressive phase is completed, the succeeding can start. The early
stages of the project are under construction, as the next stages are under design.
For obvious reasons Fast Track and D.B.B. sometimes offer tempting advantages to
the client-owner, but at the same time they can be the source of many problems.

When a contract is Turnkey, the client has to provide all the necessary information
and the design requirements to the contractor, who has to design and construct the
project under a single convention. The single convention eliminates the need for
client’s coordination and reduces the duration of the project. After the completion of
the project, it is delivered straight to the client.

4. Main Project Stakeholders

Every project has many stakeholders, whose number depends on its size. The most
common stakeholders are the Owner (Client), The Architect-Engineer, The Prime
Contractor and the Subcontractors. Apart of these there is a big number of other
indirect stakeholders as the law consultant, the insurance company etc (Clough, R.,
Sears G. and Sears K. (2000)).

4.1 The owner

The owner, whether public or private, is the instigating party that gets the project
financed, designed, and built. Public owners are public bodies of some kind, and
range from the federal government down through state, country, and municipality
entities to a multiplicity of local boards, commissions, and authorities.
Appropriations, bonds, or other forms of financing set the payment for the public
projects, are built to perform a defined public function. Private owners may be
individuals, partnerships, corporations, or various combinations thereof. Most
private owners have the structure built for their own use: business, habitation, or
otherwise. However, some private owners do not intend to be the end users of the
constructed facility; rather, they plan to sell, lease, or rent the completed structure
to others. These end users may or may not be known to the owners at the time of
construction.

4.2 The Architect – Engineer

The architect-engineer, also known as the design professional, is the person or firm
that designs the project. Because the planning is architectural or engineering by its
nature, or often combines these two, the term ‘‘architect-engineer’’ is used to refer
to the design professional regardless of the applicable specialty or the relationship
between the architect-engineer and the owner. Traditionally, the architect-engineer

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is a private and independent design company that accomplishes the design under
contract with the owner.

4.3 The Prime Contractor

A prime contractor, also known as a general contractor, is the firm that is in prime
contract with the owner for the construction of a project, either in its entirety or for
some designated portion thereof. In this regard, the owner may choose to use a
single prime contractor instead of several separate prime contractors. When the
owner awards construction of the entire project to one prime contractor, then the
system is single-contract. In this system, the contractor brings together all the
diverse elements and inputs of the construction process into a single, coordinated
effort and assumes full, centralized responsibility for the delivery of the finished
job, constructed in accordance with the contract documents. The prime contractor
is fully responsible to the owner for the performance of the subcontractors and
other third parties to the construction contract.

4.4 The Subcontractor

The extent to which a general contractor will subcontract work depends greatly on
the nature of the project and the contractor’s own organization. There are instances
where the job is entirely subcontracted, so the general contractor provides only
supervision, job coordination, project billing, and perhaps general site services.
Customarily, the prime contractor will perform the basic project operations and will
subcontract the remainder to various specialty contractors. Types of work with
which the prime contractor is inexperienced or for which it is not properly equipped
are usually subcontracted, since qualified subcontractors generally are able to
perform their specialty faster and less expensively than the general contractor.
When the prime contractor engages a specialty firm to accomplish a particular
portion of the project, the two parties enter into a contract called a subcontract. No
contractual relationship is thereby established between the owner and the
subcontractor. When a general contractor sublets a portion of its work to a
subcontractor, the prime contractor remains responsible under its contract with the
owner, for any negligent or faulty performance by the subcontractor. The prime
contractor assumes complete responsibility to the owner for the direction and
accomplishment of the total work. An important part of this responsibility is the
coordination and supervision of the subcontractors.

5. Case Study: The Khalifa Port project in Abu Dhabi

The emirate of Abu Dhabi constructs a new port and an industrial zone, which costs
almost 1.4 billion euro, in the coastline between Dubai and Abu Dhabi. The port and
the industrial zone will be developed separately. The Khalifa port will be developed
in five phases and will include a container handling terminal and piers for handling
raw and bulk cargos. The portal will replace Abu Dhabi’s largest existing port, Mina
Zayed by 2012.

5.1 Scope of Work & Major Quantities

Work in Khalifa port is divided to five phases and includes:

 Creation of 2.6 million sq. m. marine platform.
 Dredging and Reclamation works.

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 Constructing of a 32 km quay way and 7.3 km breakwaters.

 Constructing a 4.6 km causeway.
Khalifa port will be build offshore and connected to the onshore industrial zone by a
four-km bridge or causeway.
The quantities in this project are big and difficult to be specified. Here are
presented the major quantities
 Revetments 17 km
 Breakwaters 7.4 km
 Main Bridge 1 km
 Utility Bridge 1 km
 EMAL Trestle 1.6 km
 Main Quay wall 3.2 km – at 18m
 EMAL Quay wall 0.8 km – at 18m
 Other Quay walls 0.5km
 Dredging/Reclamation 47 mill cubic meters

5.2 Project Stakeholders

Abu Dhabi port Company awarded the contract of Khalifa port to a Consortium
comprising of Archirodon Construction (Overseas) Company, Boskalis Westminster
Middle East and Hyundai Engineering and Construction Company. The consortium
named “Khalifa Port Marine Consortium (KPMC)”. The prime contractor (who has
the management of consortium) is Archirodon. International Bechtel Co. Ltd. is the
Project Management Consultant, who controls the contractors. The project will take
four and a half years to complete. Unusually, at the time of the contract award,
much of the final design work surrounding the port’s construction was yet to be
done. The client, Abu Dhabi Ports Company, was looking for contractors with the
skills and multidisciplinary services needed to deliver this design expertise as the
work progressed. As a result, the three companies are co-coordinating the design
activities, not only in the dredging and reclamation work, but also in the
construction of the quay walls, bridges and breakwaters. This deep-level
involvement means that the Consortium can act as both advisor and partner of the
client and so arrive at the optimum solution.

5.3 Contract Form and Delivery Method

The contract of Khalifa Port is based on FIDIC Form contract. The main reason for
this format is that the project is too big and by this format the risks are balanced
with a tested contract in international environments. The different works of the
project can be either Lump Sum or Re-measurable contracts. This has to do with
the type of the work. Dredging & Reclamation, for example, are Re-measurable,
because these works depend on the quantities. Personnel payments and bridge
construction are Lump Sum as these works are defined and can be easily deigned
and constructed.

5.4 Challenges

Tight project schedule is a classic challenge for this type of project. The offshore
construction (without initially access by land) is another challenge. All the personnel
and material was transported by sea. The exposure to extreme weather is the next
challenge. The winter storms bring NW winds with speed > 20m/sec and the waves
study height measures 5m. Logistics can be a problem in this project. Adjustment

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of material supply with critical times for construction of the breakwaters and
Dredging/Reclamation is another consideration.

Early-stage design and planning were particularly crucial in this project because of
the unique combination of environmental, commercial and political pressures. On
the one hand, Khalifa Port is close to the most extensive coral reef in the Arabian
Gulf. This meant the project had to be planned using the latest methods to protect
the marine environment. On the other, the project area is close to the TSFCO
facilities which consist of seawater intakes for the desalination plant of the Abu
Dhabi Water & Electricity Authority and the power plant of the Taweelah Asia Power
Company. These are the main producers of drinking water and power for the Abu
Dhabi region. Protecting both these areas from excessive turbidity levels is vitally
important in the execution of the dredging and reclamation works. Thirdly, the
integration of the port development with the construction of the Emirates Aluminum
(EMAL) smelter heightens the commercial and political sensitivity of the project.
EMAL, a joint venture between the emirates Abu Dhabi and Dubai, carries
significant economic consequences for the region.

Coordination and communication between the three contractors and the client is,
probably, one of the biggest challenges. The main problem in such consortium is
the different working cultures and the different ways of approaching various issues
and problems. Each company has its own specific methods for project design and
management. This means that even details and minor issues may evolve into major
disagreements.
Communication is a common problem in international sites (or The Tower of Babel
Problem is present (as it is usually called). The management team of Khalifa port
project comes from different backgrounds and in total speak four different native
languages, namely Greek, Dutch, English and Korean. If we look deeper in site
personnel and labours, we realise that there are nationalities such as Chinese,
Arabic, Filipino, Indians, Nepalese etc., where effective communication is definitely
not an easy task.

6. Solutions

The early involvement of the Consortium in the project has paid dividends, with
members of their environment, design and engineering teams remaining on-site
from the tender into the execution phase. This has ensured the plan was put into
action with maximum efficiency.
Consortium is bringing leading-edge expertise to all aspects of the work:
 The differences, between the stakeholders, are being solved from a trustful
person, who is accepted from all the three companies of the Consortium and
the Client.
 The decisions are irreversible, so there will be no delays from appeals or
disagreements.
 16 fixed monitoring stations have been installed around the site, transmitting
real-time data on turbidity, waves, currents, water levels and weather
conditions. This online reporting technique has rarely been used on this scale
before.
 Consortium have designed special heavy-duty silt screens which have been
placed over a distance of several kilometers, separating the marine
operations from the corals and the seawater inlets of the desalination and
power plant. These screens were designed by Boskalis in cooperation with

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the supplier for use in rough open water - tailored to the local conditions. The
screens are repositioned as the work progresses.
 A 6 km-long ‘environmental breakwater’ has been build, specifically designed
to protect the coral reef and desalination and power plant.
 The construction companies are using a specially developed ‘spreader
pontoon’ in the reclamation area that evenly disperses coarse and fine
material to ensure the best distribution and end product.
 Continuous hydrographic surveying is performed to monitor changes in the
level of the seabed.

7. Conclusions and recommendations

If you read the Contract you get Education, if not you get Experience… from your
mistakes. It should be noted that the executives who rise to the upper levels of the
companies are those, who involve themselves early with the contracts and the
delivery methods. The engineer nowadays must possess a set of economic and
legal knowledge beyond the technical knowledge. It is a fact that an engineer
spends more time on matters not related purely with civil engineering subject.

Project delivery methods are driven by specific cost and schedule requirements of a
project. Another important issue in projects is the relationship developed with the
consultants/clients, who supervise the contractors. This why contractors and
clients/consultants should work together as a team and foster a win-win attitude for
the benefit of the project.

8. References

Clough, R., Sears, G. and Sears, K. (2000), “Construction Project Management”,

Wiley, 1-78.
Kalyviotis, N. (2008), “Construction Contracts, Project Delivery Methods and Roles
of Project Stakeholders”, Diploma Thesis 32-41, 65-74, 85-102, 131-140,
Department of Civil Engineering, Aristotle University of Thessaloniki.
Royal Boskalis Westminster “Case: Khalifa – a major new port in the Arabian Gulf”,
Annual report (2008), 40-41
Web page of “FIDIC: International Federation of Consulting Engineering” (2010),
www.fidic.org
Web page of “Institution of Civil Engineering” (2010), www.ice.org.uk
Web page of “New Engineering Contract (NEC) Contracts” (2010),
www.neccontract.com

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AA102

The Decision-less Environment of the Future PM

Jacob Kashiwagi
(Researcher, Arizona State University, Tempe, U.S.A.)

Kenneth Sullivan
(Assistant Professor, Arizona State University, Tempe, U.S.A.)

Dean Kashiwagi
(Professor, Performance Based Studies Research Group, Arizona State University,
Tempe, U.S.A.)

Abstract
Project managers (PM) routinely make decisions in managing projects. Decisions
are made when the project manager does not have sufficient information. Decision
making increases risk, and usually forces an increase in project management,
direction, and control. The future PM model is one where decisions, direction,
control, and risk are minimized. Decision making will be forced to the lowest level,
where the expert has been hired to minimize risk. The new model is one of
observation instead of using technical expertise, and one of quality assurance
rather than direction and management, and leadership based rather than
information based. The new decision-less environment is being developed at the
Performance Based Studies Research Group (PBSRG) at Tempe, AZ in the areas of
the delivery of construction, IT, food services, sports marketing, and document
control. The decision-less environment has a new contract model, a new risk
model, a new outsourcing model, and a new project management model which
manages a system instead of a technical function/service.

Keywords
Future PM Model, Decisions, Decision-less Environment,

1. Introduction

The objective of project management (PM) is to deliver projects on time, with

minimized cost and time deviations, and meeting the expectations of the
buyer/client. In both the delivery of construction and IT services, PMs representing
buyers have had a difficult time. Instead of proposing the traditional direction,
management, and control approach of the Project Management Institute (PMI) and
the International Project Management Association (IPMA) which focuses on the
technical knowledge of the PM, this paper uses deductive logic to solve the problem
and design the new PM model.

Traditional PM research to improve project management practices uses inductive

approaches. The inductive approach has the following methodology:

1. Do a complete literature search to identify the state of knowledge of the

industry and best practices.
2. Identify a hypothesis that improves PM performance.

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3. Either run a sufficient amount of tests testing the hypothesis, or do a survey on

the concepts of the hypothesis, and depend on the industry participants to
validate the potential of the hypothesis.

The inductive approach is an exploratory approach which uses statistical analysis on

test results or on the responses of industry participants on the concepts of the
hypothesis to validate the hypothesis. Repeated and random testing of PM
practices is difficult due to the number of variables and uniqueness of each delivery
of services. Surveys and the analysis of industry participants is the usual method
to identify potential improvements of PM practices. Deductive research is not
exploratory, but confirmatory. It is the observation and use of dominant concepts
that exist. Deductive logic is responsible for the majority of breakthroughs in
improving value and having impact (Einstein (1919)). Deductive logic uses
dominant concepts that are non-technical in nature. Dominant logic and concepts
include:

1. When the initial conditions of an event are clearly understood, the outcome of
the event is more predictable.
2. When the outcome is predictable, there is only one outcome, and decision
making is minimized because the outcome is easily predicted.
3. All outcomes of events are predictable if enough information is given on the
initial conditions of the event.
4. Decisions are made when the initial conditions of an event are not clearly
predictable, and potentially multiple potential outcomes are perceived.
5. Decision making increases risk of not meeting the expectations of a buyer/client.
6. Decision making is not a good practice of a PM who is minimizing risk.
7. A risk minimizing practice would minimize decision making.
8. information defining initial conditions always exist, but need to be perceived.

2. Hypothesis

Decision making increases risk in project management. Project managers must

minimize decision making to minimize risk. A structure/process will be created that
minimizes decision making and therefore minimizes risk. If a structure that
minimizes the buyer’s PM’s decision making is implemented by a PM, the risk of not
meeting the buyer’s expectations is minimized. The future PM model will be where
the PM does not manage the project’s technical risk, but where he manages a
systems structure that minimizes the risk of the project.

A decision minimizing structure will be created. The objective of the project

management structure is to minimize the risk of not meeting the client’s
expectations. After the structure is created, tests will be run to show that when
decision making is minimized, the risk of not meeting the client’s expectations is
also minimized.

3. More Deductive Concepts

An event is defined by the authors as anything that takes time (Kashiwagi (2010)).
A project where services are delivered is an event. It has initial conditions and it
has final conditions (Figure 1.) If all the information was known on the initial
conditions, the final conditions can be predicted. The authors also propose the
following deductive concepts:

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1. The more accurate the understanding of the initial conditions, the more accurate
their prediction of the final outcome.
2. For any event, subject matter experts (SME) of an event can most accurately
identify the initial conditions.
3. Experts have two major characteristics: they have experience with the event,
and they have expertise to identify the initial conditions, and efficiently and
effectively deliver the final outcome of the event.
4. Less qualified participants, will not be able to accurately identify the initial
conditions, nor know how to deliver the service from the beginning to the end,
and cannot accurately predict the final outcome of the event.

Fig 1: Event (Kashiwagi, 2010)

A quick analysis of the participants in a project, who are attempting to define the
initial conditions of a project, identifies that the expert vendor or expert can most
accurately identify the initial conditions. The buyer of the service/project is the
least expert, and will have the most inaccurate perception of the initial conditions.
They will make the most decisions to predict the outcome, and will have the most
false expectations. If the false expectations are placed on the vendor, the risk of
not meeting the buyer’s expectations is maximized. Therefore, to minimize the risk
of not meeting the buyer’s expectations, a PM structure must be put into place that
minimizes the decision making of the buyer and other professionals representing
the buyer by putting into place a structure/process that identifies the expert/vendor
who most accurately identifies the initial conditions of the project, within the
affordability of the resources of the buyer.

4. New PM Model Structure Requirements

Using the deductive logic and concepts discussed above, the requirements of the
new PM model structure include:

1. Minimizing the use of SMEs and decision making of the buyer’s PM.
2. Minimizing the management, direction, and control of the SME in the new
structure due to the definition of the vendor being the expert. The expert can
most accurately perceive the initial conditions, the final conditions, and how to
move from one state to the other.
3. The expert and not the buyer’s PM will determine what will be provided.
4. The new PM model will identify what the buyer will receive. The PM model
structure and not the PM will determine the service provided in the project.
5. The buyer’s expectation will be modified/corrected with the expert’s accurate
assessment of the initial conditions while still in the initial conditions.
6. The system will force the vendors to compete, differentiate, and identify who is
the best value vendor within the budget, minimizing the PM’s decision making.

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5. Deductive Formulation of the New Model

The new PM model will have the following components:

1. The identification of the requirement by the buyer/client using their expectations

of the initial conditions (assumed to be inaccurate, and to be later modified by
the expert’s perception.)
2. The identification of the best value expert/vendor which most closely fits what
the client expects and within the resources of the buyer.
3. The identification of what the vendor will deliver.
4. The management of the structure that will ensure that the best value vendor’s
delivered services.

The changes needed to the current PM model will now be discussed. The
client/buyer no longer needs to know exactly what will be delivered. They just
need to convey their expectations. This will minimize the amount of work the PM is
required to do. A good estimation of what is expected is sufficient. The selection
process of the new model and not the PM will determine what will be delivered.
This is a change in paradigm. The PM no longer has to be a technical expert in
what is being delivered. This requires the system to do the following:

1. The best value expert must clearly identify itself through the presentation of
simple, dominant information that they can most accurately perceive the initial
conditions, predict the future outcome, and know how they can move from the
initial conditions to the final outcome to offer the best value.
2. The movement from the initial conditions to the final outcome must be within
the resources/budget of the owner.
3. If there is no dominant information to differentiate the vendors, the lowest
priced vendor will be selected by the system as the best value.
4. The system will ensure that the expert vendor will more accurately identify the
initial conditions, the final outcome, and how to get from one state to the other.

If the above is accomplished, the new model will have met the objectives of:

1. Minimizing risk.
2. Minimizing decision making of the PM.
3. Transferring risk and control to the vendor.
4. Increasing the value to the buyer/client (minimizing the cost and increasing the
satisfaction of the client.)

6. Measurements to Identify if the New PM Model is more Effective

The previous section identified the major differences between the traditional or
current PM model and the futuristic PM model. The futuristic PM model will be more
systems oriented than detail oriented (technical expertise is needed less); this is a
paradigm shift for a PM. Once this paradigm is accepted and used, the impact on
the PM’s practices will be identified by the following concepts (measurement in
parenthesis):

1. The client does not need to know their exact requirement, but merely be able to
most accurately identify their intent (yes or no.)

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2. The amount of information communicated to the experts can be decreased

(perceived percentage.)
3. The number of decisions of the PM will be minimized (number of decisions
required.)
4. The time and effort of the PM will be minimized by the structure (perceived
relative time and effort.)
5. The amount of direction and control over the competing experts and the
selected best value expert will be minimized (amount of management and
expertise required by PM.)
6. The satisfaction of the buyer/client will be increased when compared to the
results of the traditional process (perceived by the buyer.)
7. Measured value of the new process in terms of saving of resources (manpower
and cost.)

7. The New PM Model

The new model does not require the client to know the requirement in detail, but
merely know the intent (the what and not the how.) The intent can be anything
from a short description to a full set of specifications and drawings. The vendors
will be allowed to determine the final product/service. The entire system assumes
that the vendors are more expert than the client’s PM and other representatives.
Therefore, the process will minimize the amount of instruction and detail given to
the vendors. This favors experts, who need less information to identify what is
required. The system will also minimize what the vendors submit. The submittals
should be short, concise, and concentrate on dominant information to solve the
client’s unique requirement. If the dominant information is lacking in the
competing vendors’ proposals, the PM should quickly score every submittal the
same (not dominant.) The key experts of the vendor will be interviewed. The
experts will be graded on how accurately they can predict the outcome, how they
know they can predict the outcome, and if they exhibit human characteristics of the
expert (accountability, proactive, can predict, concise and simple communication.)

If dominant information is lacking and the vendors are perceived as offering the
same value, the low price vendor will be selected as the best value, and the best
value expert will then be requested to pre-plan to identify clearly what they will
provide and also be required to manage and minimize the risk that the vendor does
not control that is caused by the interface between the existing conditions and what
the vendor will provide.

The new PM model that was tested by the researchers at the Performance Based
Studies Research Group (PBSRG) is the best value Performance Information
Procurement System (PIPS). The major differences in the new model are:

1. The best value vendor is the expert and not the client’s PM.
2. The client’s PM does not need to be an expert.
3. The best value vendor writes the contract.
4. Dominant information identifies the best value vendor and replaces PM technical
expertise and decision making.
5. The best value vendor uses a risk management report that manages and
minimizes the risk that the vendor does not control.
6. The best value vendor measures their performance.

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8. Test Results

The new PM model has been under development and modification for the past 15
years. The testing results include (PBSRG (2010)):

1. 700 tests and the delivering of $800M of construction services.

2. The delivering of $1B of infrastructure construction services in the Netherlands.
3. The testing of the system in Botswana to select and manage a contractor.
4. The delivering of $1.3B of non-construction services by Arizona State University
(ASU).
5. The minimization of up to 90% of the project management and risk
management of clients’ PM (state of Hawaii, University of Minnesota, US Army
Medical Command, and ASU test results.)

The process was run at ASU on two specific deliveries of services: the delivery of a
10 year $400M food services contract, and the five year $60M outsourcing of ASU
networking services.

9. Food Services Delivery

The food services were delivered in 2007, and the measurements of increased
value are listed below (Michael (2008)):

1. The client identified the existing food service contract, and requested vendors to
review it if they needed to understand the scope of the current operations. The
client specified that they wanted higher customer satisfaction, more
commissioning money, more capital investment funds to improve dining areas at
the university, and more food sold.
2. This was successfully done with 1/10 of the documentation.
3. The number of decisions of the PM was minimized. The selection committee was
made up of 32 personnel, and all 32 identified the same vendor. The selection
committee rated a risk assessment value added submittal without knowing the
vendor’s names (blind), and were directed to give a 10 rating if the submittal
was dominant different, but a 5 if the difference in value was not dominant.
After all the information was put together, the difference in value was dominant
($32M more than the incumbent, and the best rating in 10 of 14 categories.
4. The time and effort of the ASU selection team was minimized. The risk
assessment and value added plans were only five pages long, instead of the
traditional 400 pages. After the best value vendor was put into place, 80% of
all ASU management personnel were transferred, quit, or working somewhere
else.
5. In the last two years the food services vendor has managed and minimized the
risk of the food services.
6. The satisfaction of the students increased when compared to the results of the
traditional process (student ratings.)
7. ASU increased their financial reward over the ten years by $32M (when
compared with the service delivered by their traditional delivery system.)

10.Outsourcing of the IT Networking Services

The new PM model was also used to outsource the ASU IT Networking Services.

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1. The client identified the existing IT networking services as best as they could.
The budget for the maintenance of the existing system ($14M/year) was given
to the vendors. The vendors were allowed to ask questions of the existing
system during the procurement process. The client did not identify their
requirement in terms of cost or level of service.
2. This was successfully done with minimal documentation.
3. The number of decisions of the PM was minimized. The competition started with
five competitors and only one could provide the services being requested (the
maintenance of the existing network.)
4. The time and effort of the ASU selection team was minimized. After the best
value vendor was selected, the management staffs at ASU were minimized by
50%.
5. The satisfaction of the new services increased by 40%.
6. ASU decreased their cost of the networking system by $1.25M and were given
added value services of $1.4M that they could not normally afford. The
dominant result of the vendor’s service was that the spend rate for
maintenance/new equipment went from 17%/83% to almost 50%/50%.

The ASU IT Director had been trying to quantify and identify improvements in their
networking systems for the past two years. He was attempting to identify the
scope and the competitive cost for the services. He was unsuccessful as his staff
could not come up with a complete enough description of the scope and costs. The
IT Director used the PIPS delivery process to quantify the scope and cost of their
system, and also to find the best value vendor who optimized the efficiency of the
system. Without a complete specification, the new PM model was incorporated and
the project was advertised. As the vendors were preparing their submittals, the
answers to the questions they asked shaped the scope and cost of the operation.
The project managers who ran the project had no IT experience. They were the
same PMs who ran the food services contract, and they also had no food service
experience.

The ASU business services and contracting personnel were impressed with the
results of the new PM model and adopted the model to deliver major services for
ASU. The financial benefit to ASU in the ten year period (2007-2017) is $100M due
to the new PM model. The success of the new PM model has spread quickly, with
the following results:

1. The State of Alaska is purchasing a $200M state wide ERP system using the new
PM model.
2. The State of Idaho is purchasing a $30M Driver Vehicle Management (DMV)
system.
3. The General Services Administration (GSA), the largest buyer of non-military
services in the U.S., is implementing the new PM model in a 4 year, $800K
research effort.
4. The State of Oklahoma is purchasing commodities using the new PM model.
5. The universities of Minnesota, New Mexico, Boise State, Idaho, Northern
Arizona, Arizona, and Missouri are testing the new PM model.
6. Although the $1B Dutch tests are not completed, the research/test group is
being directed to do another $2B of test applications.
7. Test efforts are being conducted in Finland and Botswana, and being discussed
in Australia, Malaysia, Germany, Korea and Japan.
8. The Best Value PIPS annual conference attracted 250 participants (largest in five
years,) all industry participants who are participating in the new PM model.
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9. Research funding for the Performance Based Research Group (PBSRG,) which is
totally funded by industry participants running research tests, has reached the
$8.5M funding mark, with $1M funding the last two years.

11.Conclusion

The traditional PM model/environment is a management, direction, and control

model. The model is being improved incrementally by technical training and
education. The PM model of the future has been designed using deductive logic.
The dominant logic includes:

1. Minimize management, direction, and control.

2. Clients need to know the intent of their project and not the exact requirement.
3. Project managers should not be making decisions.
4. Project managers should use the best value PIPS process to hire vendors who
are expert at their trade/expertise.
5. Control should be transferred to the expert vendor.
6. The expert vendor should measure their performance continually.
7. The PM’s role in the future is to select the best value vendor and to force a
measured environment by doing quality assurance.

The transformation of the new PM model is being fueled by the documented

dominant increase in performance, the increase in financial opportunity and
reduction in cost, and the combination of increased requirements and decreasing
funding. The futuristic PM model continues to be optimized and developed.

The new PM model is where the PM manages a system which uses dominant
information and minimal decision making. Instead of managing technical
functions/services, the future PM will be managing systems which align high
performance vendors. Further information and details can be found at pbsrg.com
or with the CIB W117 Using Performance Information in Construction.

12.References

Einstein, A. (1919) "Induction and deduction in physics." Berliner Tageblatt

(December 25) [Translation by Alfred J. Engel. 2002. The Collected Papers of
Albert Einstein: Volume 7. The Berlin Years: Writings, 1918–1921. Princeton
University Press, Princeton, NJ, 221–236.
Kashiwagi, D. (2010) “Best Value PIPS/PIRMS,” Performance Based Studies
Research Group, Kashiwagi Solution Model Inc., Mesa, AZ.
Michael, J. and Sullivan, K. and Kashiwagi, D. (2008) "Leadership Based Project
Management Model Tested on Food Services at Arizona State University." 4th
Scientific Conference on Project Management (SCPM) & 1st International Project
Management Association (IPMA) / Mediterranean Network (MedNet) Conference
on PM Advances, Training & Certification in the Mediterranean, Chios Island,
Greece, pp. 234-238 (May 29-31, 2008).
PBSRG (2010) “Performance Based Studies Research Group Internal Research
Documentation,” Arizona State University, Unpublished Raw Data.

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AA103

New Contract Model for Project Management

Jacob Kashiwagi
(Researcher, Arizona State University, Tempe, U.S.A.)

Kenneth Sullivan
(Assistant Professor, Arizona State University, Tempe, U.S.A.)

Dean Kashiwagi
(Professor, Arizona State University, Tempe, U.S.A.)

Abstract
A new contract model has been developed which changes a project manager’s (PM)
responsibilities from writing and enforcing a contract, to transferring the
responsibility of writing and administering the contract to the vendor. The new
environment changes the PM’s role from management, direction, and control, to
quality assurance. Quality assurance is ensuring the vendor has a quality control
and risk management plan. The new model is based on the assumption that the
client cannot control the vendor through the contract. The control mechanism is
deleted, and the vendor creates a contract document that minimizes risk. The
contractual document, which must be approved by the client’s PM and legal,
includes a risk managing mechanism called the risk management plan (RMP) and a
weekly risk report (WRR.) The new contractual mechanism is the expert
contractor’s mechanism to document and minimize risk and transactions.

Keywords
New Contract Model, Managing Risk, Transfer of Risk and Accountability

1. Introduction

The delivery of construction and IT services has traditionally been done through
specifications written by professionals who represent the client. The performance
of these services has not been stellar. Performance in construction is estimated at
70% (no cost or time deviation by the vendor, and meeting the expectations of the
client) (Post (1998)). The performance in the IT industry is even lower at 30%
(Vital Smarts (2006)). The poor performance is difficult to solve in the relationship
and politically oriented environment of the price based sector represented in the
construction industry structure (CIS) in Figure 1. The authors are proposing that
the performance is low in the price based environment because the environment is
built upon inefficient and inaccurate practices of control that result in
vendors/people not being accountable, reactive, and basing their value on
relationships. The following actions are driving down the performance of vendors:
1. An expert vendor is being directed by a person with less expertise.
2. Vendors are directed to submit the lowest possible price (Figure 2.)
3. By communicating the requirement in terms of minimums in a price based
environment, clients direct the vendors to transform the minimum into a
maximum, creating an adversarial win-lose environment (Figure 3.)
4. The solution of clients to the vendor non-performance is to increase direction
and control.

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Fig 1: Construction Industry Structure (Kashiwagi, 2010)

Fig 2: Price-Based Award Fig 3: Min/Max Dilemma

(Kashiwagi, 2010) (Kashiwagi, 2010)

2. Hypothesis

The authors are proposing that one party cannot control another party. The
authors are also proposing that if any control mechanisms are being used by a
buyer and their project manager to manage and minimize risk, the performance will
be minimal, the vendor will be reactive, and the project manager may be forced to
increase their management, direction, and control functions.

3. Control and Influence

Control and influence are functions of today’s project manager. Project managers
minimize risk by management and control of vendors. Management and control
have been used by parties to influence the outcome and behavior of vendor
services. The authors will use deductive logic to propose that control is not as
effective as alignment of resources.

Two different deductive models will be used. The first will be the use of an extreme
opposites model of an influence model vs. a no influence model (Kashiwagi (2007)).
The extremes make the result dominant, simplifying the concept and minimizing
decision making. The second model will be a teacher and his four students and
their ability to learn the same subject matter. Figure 4 shows the no influence
model on the left hand side, and the influence model on the right hand side. The
person who uses the extreme influence model believes that:
1. Forces from outside of their control may influence their life. This is by definition
of the model in Figure 4, where external forces are impinging on the individual.
2. Things can happen by chance and affect their life even though it has nothing to
do with the individual being influenced. These things are unpredictable and not
understandable by the person because the source is the external environment.
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3. Without their choice, they can be controlled/influenced by other people.

Fig 4: No Influence / Influence Model

(Kashiwagi, 2010)

The extreme “no influence” model believes that everything that happens around
them has something to do with what they have done. They believe that:
1. They have complete control over their lives.
2. Nothing happens to them by chance. If they use hindsight, they can clearly see
why an event happened in their life, what actions they did which caused the
event, and understand the relationship of the event to themselves.
3. They cannot be controlled by someone else, neither can they control others.

People with the two extreme approaches to life will have different characteristics.
By asking which extreme model the characteristic is more likely to belong to, the
relationships between the characteristics can be easily identified.

According to which approach is more likely to have the following characteristics, the
“influence” model represents:

1. Believes in chance.
2. Believes in control and influence.
3. Does not understand other people.
4. Believes in win-lose.
5. Will blame others if something goes wrong.
6. Does not continuously improve.
7. Does not pre-plan, or attempt to predict the future outcome.
8. Are ineffective and inefficient.
9. Are reactive and short sighted.
10.Are more illogical.
11.Makes decisions and increases risk

The “no influence” model is the extreme opposite. It represents accountability,

pre-planning, the alignment of resources instead of using control, win-win,
continuous measurement and improvement, and minimized decision making.

The second deductive model is a teacher that has a class of four students. If the
teacher had influence or control, the teacher could ensure that all the students
learned the same exact knowledge. Deductive logic identifies that the person who
controls the amount they learn is the student, and not the teacher. A lack of
information leads some people to believe that the teacher has influence and
control, but they have no validating information. It is only a proposal of an idea.
All information tends to support the concept that people have control over their own
selves and results. This is the concept of accountability. If this is true, it is
impossible for one party to control or influence another.

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The following are examples of the attempts of one group to use control and
influence to change another party. According to the deductive logic discussed
above, the attempt should be ineffective and inefficient (cost is high, transactions
and problems will be perceived as stubborn and unsolvable, and results are not as
expected or unsatisfactory.) The events of attempted control include:

1. The attempt by a person to change their spouse.

2. The attempt by the United States to change the political environment of Iraq.
3. The attempt by the penal system to reform people who have broken the law.
4. The attempt of the U.S. federal government to stop the use of drugs in the U.S.
5. The attempt of law enforcement to change the behavior of people and stop them
from breaking the law.
6. The attempt of companies to enforce standards in their companies.
7. The attempt of companies to use leadership training to influence people.

One of the major reasons for divorce is the incompatibility of spouses. Spouses
who believe they can change or influence their spouse are less likely to pay
attention to compatibility before marriage. In location where pre-arranged
marriages are practiced, and where family status, wealth, and education are
considered to minimize risk, the divorce rate is less than 1% (Divorce in India
(2008)).

The war in Iraq is a dominant example of someone’s belief that they can control
another group of people by changing their lifestyle, beliefs, and form of
government. What was once the breadbasket of civilization and an example of
technology is now a war torn country. The U.S. thought the war against Saddam
Hussein’s forces was the biggest obstacle in Iraq. They learned that changing the
people’s culture is much more difficult. The U.S. has attempted this before in
Vietnam, Iran, Korea, Bosnia, Haiti, Somalia, Russia, China, and now in
Afghanistan. The results have been costly and poor.

The penal system is designed to rehabilitate criminals. The measurements show

we have no control over the any of the criminals. Many of them do the same thing
in prison that they do out of prison. The return rate for offenders is at 80%
(Langan (2002)). The solution to a lack of funding in a down economic cycle is to
release them because we cannot afford to incarcerate them and the practice is
ineffective. Ironically in the U.S., we incarcerate more people than any other
country.

The attempt to control the trafficking and use of illegal drugs in the country is one
of the most dominant examples of the lack of control. The U.S. spends $400B per
year on the attempt to control drugs. Over 70% of the funding is used in legal
costs of court cases and administration (Jones (1999)). The drug war has
increased violence in all countries where the drugs are either grown or trafficked.
Because drugs are now controlled substances, the profit for illegal cartels is high
and lucrative. Availability of the drugs is everywhere. This is not unlike the period
of prohibition, where for 12 years, the federal government tried to control alcohol.
After seeing the high cost, the flourishing of illegal mafia groups, and the inability
to stop the consumption of alcohol, alcohol was made legal. Today, people drink
alcohol as a beverage. The legalizing of drugs in both the Netherlands and Portugal
has radically reduced cost, crime and drug problems.

Deductive logic and dominant examples of history identify the control or influence
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model as ineffective and inefficient. The use of control or influence has not
minimized risk.

4. Supply Chain Management and Best Value Procurement

In the delivering of services, there are many attempts to influence and control.
One of the major mechanisms of control is the contract. In the previous section,
deductive logic was used to identify that experts minimize risk and not legal
documents such as a contracts. The deductive logic discussed proposes that the
entire concept of one party dictating to another party what should be done and
attempting to enforce or control the party may be ineffective.

A system has been developed called the Performance Information Procurement

System (PIPS.) A derivative of PIPS is called the Performance Information Risk
Management System (PIRMS.) PIPS and PIRMS are best value alignment systems
that have been tested since 1994. The purpose of this paper is not to discuss the
details of PIPS/PIRMS, but to address the practice of direction and control to
minimize risk, the use of contracts, and the alignment of resources.

Best value procurement has the following difference with the traditional
procurement used by project managers:
1. The project manager (PM) does not have to create a specification which
identifies the requirement of the client/buyer which will be delivered by the
vendors, but merely identifies the intent of the buyer.
2. The PM uses best value procurement to identify what the vendors can offer
which attempts to meet the intent of the buyer.
3. The PM will pick the alternative that best satisfies the intent of the buyer.
4. The PM then ensures that the vendor has a risk management system that
delivers what the vendor has promised.

These changes have the following impact on the delivery process:

1. The PM and buyer’s team no longer has to be a technical expert.
2. The risk of the service not performing is transferred to the vendor.
3. What is being procured is a service/systems delivered in an environment that
the vendor does not control that meets the expectations of the buyer.
4. The transfer of risk and control to the vendor forces the vendor to be an expert
or to learn what the expert should know, and perform accordingly.
5. The expertise of the vendor can now be identified in dominant terms: has the
vendor accomplished their task before, can the vendor distinguish the risk of the
environment which they cannot control, and can they manage and minimize the
risk of the unique environment, can the vendor identify what they are delivering
in terms of performance, and can they write a simple contract on how they will
deliver the service.

The changes in the paradigm force vendors to compete (price and performance)
and change the buyer’s PM responsibilities from technical expertise to quality
assurance.

5. New Procurement Paradigm

The new procurement paradigm is shown in Figure 6. The requirement of the

client/buyer PM is now to identify the intent of the buyer. The intent could be
anything forms a simple requirement statement to a detailed design and
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specification. Regardless of the detail in the explanation of the intent, the

requirement is merely an intent of the buyer.

H 1 H
Vendor Vendor 1

Level of Value/Performance
ce
n
a
Vendor 2 Vendor 2
rm
o
fr
e
P
/
Requirement e Requirement
lu
a
Vendor 3 V Vendor 3
f
o
l
e
v
Vendor 4 Le Vendor 4
L L

Fig 5: Traditional Procurement Fig 6: New Procurement

Philosophy (Kashiwagi, 2010) Philosophy (Kashiwagi, 2010)

Every vendor perceives the intent slightly differently, and the proposal of the
vendor has an accompanying price and level of performance. No two vendors will
deliver exactly the same service/system. In the traditional price based
procurement paradigm, the procurement officer representing the buyer will either
assume that the vendor’s deliverable service is the same as the requirement, or not
understand that the vendor’s level is different and attempt to force the vendor to
modify their deliverable to match the requirement. From Figure 5, the procurement
officer would eliminate the lower two vendors, or force them to modify their
deliverable. Or they would identify the higher two vendors as being the same, and
award to the lowest price. In the traditional best value process, the buyer’s
procurement agent would either force vendor #3 to increase their
value/performance of their proposal and maintain their low price, or get vendor #2
to lower their price and deliver the higher proposed value/performance of their
proposal. This is often known as “best and final” or negotiated price.

In the new procurement paradigm, the application of logical, effective, efficient and
dominant practices minimizes risk and accompanying transactions:
1. Minimize risk of non-performance. Risk is minimized when the vendor is an
expert and knows exactly what they are going to do, before they deliver. This
includes their price, their deliverable, and their schedule.
2. Minimization of direction to the vendor from parties who are not experts.
3. Minimization of the risk of over-expectation, as the vendor dictates the final
deliverable service/system and not the client.
4. Minimization of the risk of requiring what may not be available.

The buyer’s PM no longer needs to know what they are procuring when issuing the
solicitation or request for proposal. The requirement is now simply the buyer’s
intent, a budget, and a time frame of delivery. The new procurement paradigm will
identify all three previously buyer determined factors: the delivered system/service,
the price, and the schedule. The new procurement paradigm has changed the PMs
responsibility from management, direction, and control (which requires technical
expertise) to quality assurance (identify the best value and ensure that they are
practicing quality control and risk management.) The vendor will now improve
quality by minimizing time and cost deviation (Deming, 1982.)

6. New Contract Paradigm

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The contract paradigm changes from the client/buyer attempting to control the
vendor by use of a contract (Figure 7), to the new paradigm of using the contract
to manage and minimize risk by the expert (Figure 8.) Using the concepts of
deductive logic that mechanisms of control will only result in increased transactions
and inefficiency, the sole purpose of the contract is to manage and minimize risk.
The party most effective to manage and minimize risk is the expert vendor. The
new contract mechanism forces the vendor to pre-plan, and to manage and
minimize risk. They must identify:
1. Performance requirements that must be met.
2. Technical requirements of the project.
3. Legal contract requirements of the client for bonding, insurance, local codes.
4. A mechanism of documentation of risk that clearly identifies deviations (risk) on
the project and accountability of the risk in terms of cost and time.

Fig 7: Traditional Contract Model Fig 8: New Contract Model

(Kashiwagi, 2010) (Kashiwagi, 2010)

The new contract paradigm involves no control or influence, but the selection of an
expert contractor that meets the intent of the client within the constraints of the
buyer’s environment, time and funding. The new contract paradigm in conjunction
with the procurement philosophy creates an environment of transparency that
simplifies the management of projects. A part of the transparency is the risk
management documentation that the contractor maintains that does the following:
1. Identifies all the risks and concerns of the client, technical experts, and the
contractor before delivering and forces a plan to manage and minimize these
risks as a part of preplanning and as a major component of the contract.
2. Uses a weekly risk report that identifies any risk that will lead to cost and time
deviation, the source of the risk, and how the risk is being minimized.

Both these risk management tools have been developed as a part of PIPS/PIRMS
and are known as the risk management plan (RMP) and the weekly risk report
(WRR) (Kashiwagi, 2010.) These documents are a major part of the contract
written by the vendor. The vendor written contract must be reviewed and
approved by the client/buyer’s legal and technical staff.

7. Testing of the New Procurement and Contract Paradigm

The new procurement philosophy and contract paradigm has been tested at Arizona
State University (ASU) for the past three years on contracts totalling $1.5B of
delivered services (food services, sports marketing, gym equipment, IT networking,
IT data center, help desks, document control, and long distance education. The
impact on the delivered services includes (PBSRG (2010)):
1. The minimization of vendor created risk. In the four years, there have been no
deviations caused by the vendors.

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2. The increase of value of the delivered services when compared to the previous
services delivered with the traditional processes ($100M over the next 10
years.)
3. The minimization of management, direction, and control transactions by 80%.
4. The minimization of risk that normally would have to be managed by the client’s
PM which included the re-establishment of services after a non-vendor related
disaster at the university.
5. The measurement of all vendor services by the vendor in comparison with past
services and vendor performance requirements using objective measurements.
6. Contract administration by the vendors.

The new procurement philosophy and contract paradigm have been implemented at
ASU as the new method to deliver services.

8. Conclusion

The new procurement philosophy and contract model changes the project
manager’s (PM) role from the technical expert who is managing, directing, and
controlling, to a quality assurance coordinator who runs systems that ensure the
alignment of the best value vendor with the buyer’s intent. The PM now transfers
risk, control, and accountability to the best value vendor who is expert. The best
value vendor identifies what they will deliver, how they will deliver it, and
administers their own contract using documentation that identifies deviations to
their proposal, and how they will manage and minimize the deviations. The new
philosophy and procurement will force the transition from the traditional models to
the new model due to dominant value/performance differences, the deductive logic
behind the new concepts, and the minimization of risk and transactions caused by
the traditional management, direction, and control practices. When control and
influence based concepts are removed, the cost savings have been dominant.
When researching the efficiency and effectiveness of control/influence concepts, the
authors were surprised at the cost and results of such practices. The dominant
results of previous efforts attempting control give tremendous motivation to change
to the new philosophy and paradigm. Project management (PM) will be
transformed by the movement of owners/clients/buyers to efficiency and value.

9. References

Divorce in India (2008), "Divorce Rate in India", Retrieved on March 14th, 2010, Website: http://www.divorcerate.org/divorce-
rate-in-india.html
Jones, S. T. (1999), "US CA: What does the drug war cost?", New Times. Retrieved January 8, 2010 from
http://www.mapinc.org/drugnews/v99/n667/a01.html.
Kashiwagi, D. (2010) “Best Value PIPS/PIRMS,” Performance Based Studies Research Group, Kashiwagi Solution Model Inc.,
Mesa, AZ.
Kashiwagi, Jacob (2007), "Leadership is alignment not influence", Arizona State University. Tempe, AZ: United States of
America. Master Thesis.
Langan, P. & Levin, D. (2002), "Two thirds of former state prisoners rearrested for serious new crimes", Time Magazine,
Retrieved from http://www.time.com/time/magazine/article/0,9171,914566,00.html.
PBSRG (2010) “Performance Based Studies Research Group Internal Research Documentation,” Arizona State University,
Unpublished Raw Data.
Post, N.M. (1998), "Building Teams Get High Marks", Engineering News Record, 240[19], 32-39.
Vital Smarts and The Concours Group (2006), "Silence Fails: The Five Crucial Conversations for Flawless Execution",
VitalSmarts L.C.

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AA105

Strategic Plan for the Implementation of a New PM Model

Dean Kashiwagi
(Professor, Arizona State University, Tempe, U.S.A.)

John Savicky
(Lead Project Manager, Arizona State University, Tempe, U.S.A.)

Kenneth Sullivan
(Assistant Professor, Arizona State University, Tempe, U.S.A.)

Abstract
The University of Minnesota has been implementing the best value Performance
Information Procurement System (PIPS) for the last four years. PIPS uses a new
project management model which transfers risk and control to the vendor, and
minimizes the client’s PM activities. The performance of the vendors has increased
and the number of transactions has been minimized, however, many of the project
managers have resisted the new PM model. The resistance of the PMs has resulted
in the analysis of the strategic plan to implement the new project management
model. The result of the analysis is that the strategic plan must concentrate on the
development of the core team of visionaries and not on the implementation of the
new PM model. The tactical plan on the mechanics of the new PM model is also
required, but is not as important as nurturing the core team of visionaries who are
leading the change. The strategic plan ensures the sustainability of the new PM
model.

Keywords
New Project Management Environment, Transition of PM Responsibilities.

1. Introduction

The University of Minnesota (UM) has been implementing the new PM model in
delivering construction for the past four years. Led by the visionary head of
construction, and a core team of implementers (who are selected based on their
affinity to the new PM model,) the group transformed from the traditional delivery
process of management, direction, and control, to the new PM model of quality
assurance. The major goals were efficiency, effectiveness, competition, and
increased vendor participation. The UM core team results of PIPS implementation is
listed below (PBSRG, 2010, Sullivan et al, 2007)):

1. Number of Best-Value Procurements: 142

2. Average Proposal Cost: $46 M
3. Awarded Cost: $40 M (-12%)
4. Average Number of Proposals: 4
5. Projects Where Best-Value was also Lowest Cost: 55%
6. Projects Where Best-Value had Highest Cost: 7%
7. Completed Projects: 111
8. Contractor Cost Increases: 0%
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9. Contractor Schedule Increases: 4%

10.CPPM PM post project rating of Contractor: 9.5
11.CPPM PM management requirements: -65%
12.Awards made to TGB firms: 15% (22 out of 142)
a. 111 Number of completed projects surveyed
b. 9.9 Overall satisfaction of Best-Value process
c. 9.5 Overall satisfaction of contractors performance
d. 65% Decrease in PM’s management requirements due to process
e. Targeted Businesses Statistics:
f. 32% of qualified vendors are TGB vendors (18 firms)
g. 15% of all awarded Best-Value projects have been made to TGB
vendors (30 awards out of 113 projects)
13.Vendor Statistics:
a. 53% of contractors have been awarded at least 1 best-value project
(25% have not participated on any projects). Shows that process if
open and fair
b. Vendors have documented a 4% increase in profit (significant since
over 55% of projects were awarded to lowest price)

The reduction in awarded costs, the minimization of contractor cost and time
deviations, the high customer satisfaction, and minimized management
transactions make the UM PIPS testing a success. In another comparison, Table 1
shows the comparison between projects using the traditional PM model and the new
PM model at the UM. Note that when using the traditional model, the sources of
deviation cannot be identified.

NO CRITERIA TRADITIONAL BEST VALUE

1 Total Number of Projects Analyzed 30 34
2 Total Awarded Cost ($) $     9,844,822 $   10,862,605
3 Total Final Cost ($) $   10,765,577 $   11,297,813
4 Percent Increase in Cost 9.4% 4.0%
5 Percent Increase due to Client n/a 3%
6 Percent Increase due to UMN n/a 0%
7 Percent Increase due to Designer n/a 0%
8 Percent Increase due to Contractor n/a 0%

Table 1: Comparison between Traditional PM Model and New PM Model Results

The original strategic plan was that PBSRG would educate and train the UM core
team (small group led by the visionary) and then the UM core team would lead
their own organization by taking over the major functions of the PIPS
implementation:

1. Compiling and documenting the selection data and weekly risk report (WRR)
performance data.
2. Educating the vendors, PMs and internal clients.
3. Running the PIPS system.

The timetable and strategic plan is listed below:

1. Year 1, 2005 – Pilot Testing & Core Group Education by PBSRG

2. Year 2, 2006 – Measurement and Continued Testing Led by PBSRG
3. Year 3, 2007 – Refinement and Expansion Led by UM
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4. Year 4, 2008 – Refinement and Expansion Led by UM

5. Year 5, 2009 – Transition from PBSRG control to UM control
6. Year 6, 2010 – Infusion into Other Areas

The new PM model has the following challenges:

1. It takes away control from the client’s PMs and transfers it to the vendors.
2. The new PM model is not congruent with the traditional client PM model
practices of control, management, and direction.
3. It is a leadership based system, working on alignment and not control.
4. It is a top down philosophy, and has to be well understood by a visionary
core team of individuals who can do systems management.
5. It stresses quality assurance and not technical direction and control.
6. It becomes a systems issue and not a detailed technical issue.
7. It requires discipline and both a strategic plan and a tactical plan from the
core team.
8. It is non-technical in nature, making many technical PMs who are subject
matter experts (SME) very uncomfortable.
9. It cannot be understood by the majority of PMs in an organization.
10.It brings transparency that measures performance.
11.It minimizes the importance of relationships and job positions/titles.
12.It assigns accountability by identifying the value of all individuals.

What makes PIPS/PIRMS difficult is that it is disruptive change, and not incremental
change. It is a complete change in paradigm. The new PM model had been under
development since 1994 by the Performance Based Studies Research Group
(PBSRG.) Even though, PIPS had a 98% performance record, and minimized up to
90%, no client/user had been able to implement PIPS and sustain the
implementation for over four years (State of Hawaii, 1997-2001, United Air Lines,
1996-1998, Federal Aviation Administration, 1995-1996.)

Reasons for attempting to implement PIPS in the past have been:

1. Visionaries wanted to solve the problems of non-performance from vendors.

2. Visionary recognized that the bureaucracy of their organization added to the
non-performance of the vendors.
3. Visionaries recognized that the existing system was not working and wanted
change.
4. Visionaries saw the value for their organization.

Success of PIPS has been more dominant than any other system to deliver
construction services. It is very attractive to heads of client’s organizations due to
the environment of diminishing funding and increasing requirements. The
dominance of the PIPS development, testing, and implementation includes (PBSRG
(2010)):

1. 16 years of continual, increasingly successful testing.

2. Research funding approaching $8.5M from industry research partners who
also test the system.
3. Performance has been stunning and dominant: 98% success (no contractor
generated deviations and high client satisfaction), clearly better than the
70% of traditional projects.

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4. It has been developed, tested, and implemented within such a short period
of time with few resources. It has not had federal research, university
funding, or other internal funding to assist in its development.
5. It is not a management solution that creates more management. It actually
minimizes management and transactions by as much as 90% (one person
can do the work of as many as ten people.)
6. Win-win-win. Solution assists the vendors to increase their profit, minimize
their risk, without charging more and increasing the cost of the service.
7. Over 700 tests, delivering over $800M in construction services.
8. Tests have been in large and small organizations.
9. Solution has been implemented in different countries, from very developed to
countries that are considered “third world.”
10.Tests have included all types of construction delivery systems and all ranges
of scopes of work.
11.Solution has gone outside of the construction industry to impact other
industries which are perceived as more complex and less predictability.

After five years of testing and implementation, the test results were as predicted,
but the transfer of control of the new PM model to the UM was not as successful as
there was still internal resistance of PMs (inside and outside of the core team at
UM) to the new model. The resistance did not go away with the success of the PIPS
tests as planned. The researchers were surprised and reanalyzed their strategic
plan.

2. Resistance of the Industry and Academic Research Community

The first thing the researchers did was to review the resistance to the testing and
implementation of PIPS from the construction industry and construction
management academic researchers over the course of 16 years. Dominant logic
and simple analysis can explain this reaction (Muatjetjeju et. al. (2009); Kashiwagi
et. al. (2008)):

1. PIPS/IMT identifies management as a manifestation of inefficiency and

ineffectiveness. Management based experts have taken exception to this.
2. Many industry leaders confuse leadership with management. They consider
both to be the same. They perceive management of organizations to be
leaders. PIPS identifies the actions of most managers as the source of
problems.
3. PIPS/IMT identifies the current system as “broken” and in need of repair.
Many industry participants have taken this as a personal attack.
4. The development team at PBSRG has had neither the funding nor the time to
partner with the major research and industry organizations. Instead, they
have gone directly to the client to solve the problem. This has created
resistance from much of the industry who may feel left out of the solution or
because it is not their solution.
5. The PBSRG strategic plan to quickly identify the solution, and test and
implement, and go around any resistance, can be perceived as a short cut
from the traditional path of consensus within academic researchers.
6. The ability of PBSRG to actually identify the basic theoretical concepts, test
the concepts, modify the hypothesis, and retest the modified hypothesis is
unmatched in the academic research community. If the research and
research results are valid, it can be viewed as a theoretical attack on the
traditional inductive research approach.
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7. The choice to use the deductive logic (confirmatory) approach instead of the
inductive (exploratory) due to being more economical, faster, and has
greater impact on industry practice is a different approach.
8. The dominant results disagree with many results of previous academic
research efforts which stress technical development, the increase of use of
technology, and the implementation of knowledge capture and transfer.
9. The perception that all operations should have transparency, measurement,
and accountability, may be threatening to traditional academic research
which normally is not strategic, does not included repeated hypothesis
testing, and which has very little impact on the industry.

The authors proposed that the resistance to the industry would not be significantly
different from the resistance from PMs at the UM construction organization. The
resistance from the industry and academic research community in the past 15
years, identifies the potential problems that visionary core team (who brought PIPS
into their organization) would encounter. IMT foundation concepts upon which the
success of PIPS was based on has the following points:

1. Not everyone can understand IMT.

2. Not everyone will feel comfortable with using PIPS in its most optimal state.
3. Visionaries have to understand that they have no influence or control over
the PMs in their organization.
4. Visionaries must align resources; overcome resistance with the PIPS
structure and application of IMT principles.
5. Each PIPS application will be different. The flexibility of PIPS is its strength.
6. Visionaries will not be able to manage, direct, or control their PMs.
7. Visionaries, who gravitate to PIPS, are personnel who seek personal
development, are leaders who seek personal understanding, discipline, and
expertise, and who want to add value to society.
8. The key to the sustainability of PIPS is the visionaries’ capability to work with
PMs who are comfortable with the traditional delivery system.

In analyzing the visionaries who have attempted to implement PIPS and who are
currently implementing PIPS, the researchers have identified that the
misunderstanding and misuse of the PBSRG mentorship by the visionaries may be
the reason for PIPS not being sustainable due to:

1. The visionaries not understanding the Information Measurement Theory

(IMT), the foundation of PIPS.
2. Their personal philosophy may not in total congruence with PIPS/IMT. They
generally understand the overall logic, but when left to make a decision on
critical elements, they reverted to their traditional thinking.
3. Have a difficulty being consistent.
4. Thinking in terms of immediate success of the tests, and not long term,
strategic sustainability of the system.
5. Attempting to change their entire organization.
6. They were still price based in assessing the value of the new PM model.
7. They underestimated the difficulty of implementing PIPS. They saw it as no
different from any other management based solution.
8. They wanted total control of the system, and felt uncomfortable with the role
of PBSRG as a continual mentor.

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The visionaries did not understand that a major part of the problem to sustain the
new PM model was themselves.

3. Problem

Visionaries have been successful in testing and implementing the new PM model
(PIPS) but not in sustaining it in their organization over a prolonged period of time.
The perception of the PBSRG researchers is that if the visionaries were totally
congruent with the above characteristics of the new PM model, the system would
be more sustainable. The problem with sustaining the new PM model
(PIPS/PIRMS/IMT) is the visionaries are not totally congruent with the new PM
model and the Information Measurement Theory (IMT) that it is based upon. The
emphasis of the research mentors has been to test the system successfully in the
visionary’s organization and then turn the system over to the visionaries.

The researchers have perceived that the visionaries over time were reverting to
their own previous experience and thus leading their organizations back to their
previous practices. The problem may be their lack of understanding of IMT. Many
of the visionaries thought that the objective was to successfully run PIPS, and once
that was proven, they could easily embed it in their organizations by directing their
staffs to use the new model. Their method of implementation was to direct and
control the implementation. Their implementation was not in total congruence to
the concepts of the new PM model. The problem is not the success of the PIPS
tests, but the method of implementation of PIPS.

4. Hypothesis

The authors hypothesize that the current strategic plan was emphasizing the
successful testing of PIPS in the environment of the organization, and not the
sustaining of the new PM model once tested successfully. In implementing the new
PM model, visionaries and their core team were perceiving that once the new PM
model was tested successfully or showed dominant value in comparison to their
traditional model, the implementation would be a management, direction, and
control issue. The authors hypothesize that the key element in the successful
implementation and sustaining of the new model is changing the paradigm of the
leaders, and not the mentoring of the core team, and not the successful testing of
the PIPS process. The testing of the PIPS process is a tactical action, and the
strategic action must address the mentoring of the core team, to change them to a
leadership based alignment philosophy based on IMT principles. The authors are
proposing that the strategic plan must address the sustainability of the core team
to include education, personal growth in implementing the IMT in their operations,
and the ability to become an educator of IMT and PIPS, to implement the concepts
in their own lives, and to become educators of the new PM model outside of their
organization. The strategic plan should be oriented to the sustainability of the core
team visionaries and the IMT principles.

5. Methodology

This paper will identify the proposed plan, and a follow on study/paper will survey
the visionaries to validate the conclusion. The responses of the visionaries will be
analyzed and the results will be implemented in the research program to improve
the sustainability of the new PM model.
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6. Analysis of Visionaries

The analysis of the UM visionaries led to the understanding of the difference

between a tactical plan (testing PIPS successfully) and a strategic plan (sustaining
the PIPS model.) Using deductive logic, and case studies, the researchers identified
the following inconsistencies:
1. Felt uncomfortable with constant PBSRG research expertise assistance.
2. Was inconsistent in implementing the IMT principles.
3. The core group did not trust each other’s understanding of PIPS, and ended
up using traditional practices (leadership training, consensus, expensive data
systems.)
4. Core team reverted to traditional PM practices (management, direction,
control, and inspection, concentrating on technical details)due to the lack of
knowledge and trust in IMT concepts.
5. Assumed they had control and influence over their staff.
6. Mistakenly thought the core team had to belong to their own organization.

7. PBSRG Involvement

Instead of PBSRG (new PM Model creators) being viewed as a consultant running

the new PM model, PBSRG should be viewed as a part of the core team, as the
source of IMT implementation. The PBSRG support costs are relatively inexpensive
(one man year of costs which includes all travel and education costs, and
overhead.) The organization’s objective is not to control PIPS, but to sustain PIPS.

8. Tactical and Strategic Plans for the Implementation of the New

PM Model

A tactical plan should identify the schedule of the testing and implementation of the
new PM model. The tactical plan can include how to respond to resistance to the
PIPS process. The strategic plan is the plan to enhance the sustainability and
expertise of the core team members. As the core team members attempt to
implement a paradigm changing concept in a bureaucracy, they will face resistance
at every stage. The core team members need to have the ability to use IMT to
align resources in the bureaucracy, to know which parts of PIPS needs to be
modified and which parts need to remain to sustain PIPS, and how to respond to
the management of bureaucracy with dominant performance measurements. The
strategic plan must include the following to sustain the efforts of the core team:

1. Educational opportunities (masters degrees and PhD)

2. Presentation opportunities (national conferences, internal organization
meetings, other clients, and professional training meetings.)
3. Authoring conference and journal papers.
4. Coming up with solutions to problems using IMT.
5. Mentoring sessions to answer questions about the implementation of the new
PM model.
6. Application of IMT in their personal lives.

The above should be set aside using a weekly risk report, a milestone schedule, and
a risk management plan. Dates events and deliverables should be included in the
milestone schedule.

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9. Conclusion

PBSRG created a strategic plan to assist the University of Minnesota (UM)

implement the new PM model (PIPS.) The implementation plan was to have all the
PMs switch over to the new PM model. The strategic plan did not identify the
sustainability of the core team as the major issue of sustainability. The
implementation plan used principles that were not in congruence with the
Information Measurement Theory (IMT.) The strategic plan was in error, and led to
the continuing resistance of some of the PMs. The strategic plan should be oriented
around the PIPS visionary/core team, and not the implementation of the new PM
model (PIPS.) A successful effort to implement and sustain the new PM model
must include a strategic plan and a tactical plan, the strategic plan being more
important than the tactical plan. Without a good strategic plan, the new PM model
is not sustainable. These concepts will be communicated to the visionaries of
current and past PIPS implementation and their input will be analyzed to validate
the hypothesis.

10. References

Kashiwagi, D. and Sullivan, K. and Badger, W. (2008), "Case Study of a New

Construction Research Model", ASC International Proceeding of the 44th Annual
Conference, Auburn University, Auburn, AL, CD 4:2 (April 2- 5, 2008).
Muatjetjeju, M. and Mselle, P. and Kashiwagi, D. and Sullivan K. (2009),
"Minimizing the Impact of Culture in Botswana on the Implementation of New
PM", Manuscript submitted for publication. Fifth International Conference on
Construction in the 21st Century (CITC-V) “Collaboration & Integration in
Engineering, Management, and Technology”. May 20-22, 2009. Istanbul:
Turkey.
Sullivan, K. and Savicky, J. and Kashiwagi, D. and Perkins, M. and Grussing, J.
(2007), "Transitioning to an Information Environment: Performance Research in
Large Capital Projects and Facility Management Group", Fourth International
Conference on Construction in the 21st Century (CITC-IV): Accelerating
Innovation in Engineering, Management, and Technology, Gold Coast, Australia,
CD Track 21 (July 11-13, 2007).
PBSRG (2010) “Performance Based Studies Research Group Internal Research
Documentation,” Arizona State University, Unpublished Raw Data presented at
the 2010 Best Value Conference, Feb 8-12, 2010, Tempe, AZ.

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W09

Evaluating IT as Source of Competitive Advantage in Engineering

and Construction Organisations

Yahuza Kassim,
(University of Salford, Salford, UK)

Jason Underwood
(University of Salford, Salford, UK)

Benny Raphael
(National University of Singapore, Singapore)

Abstract
Many studies have suggested that Information Technology resources do offer
strategic advantages to organisations and enhance their competitiveness through
efficient and cost effective delivery of the organisations’ value chains. However,
because most of these studies were carried out through imprecise and unstructured
theoretical constructs the empirical results were equivocal. Thus, the
inconsistencies in the outcomes of research on IT business value were ascribed to
difficulties associated with modelling the payoffs of IT investment, mode of data
analysis, industrial context, and choice of dependent variables as some of the major
reasons. The paper adopts multi-theoretical concepts of process-based, resource-
based views and microeconomics theory as the research framework to present a
non-parametric model for evaluating the impact of information technology
utilization in gaining competitive advantage in engineering and construction
organisations. A pilot survey was conducted to verify the model value chain and
empirically tested the concept.

Keywords
Information Technology Business Value, Competitive Advantage, Construction
Organisation, Performance.

1. Introduction

It has been suggested IT-enabled strategy do have a significant impact on

construction organisations competitiveness. These may include improvement in
overall construction processes thereby creating new construction business
opportunities. Furthermore, using IT in construction projects is found to enhance
collaboration by supporting communication among project members and sharing
information and documents (Skibniewski and Nitithamyong, 2004). This paper
presents a theoretically structured model for evaluating the impact of IT resources
on competitive advantage of engineering and construction firms. A conceptual
model based on multiple theoretical paradigms was extended using non-
parametric concept, empirically tested and the results presented.

2. Theoretical Frameworks

Due to the complex linkage of how IT resources utilization may impact on

organisational performance Melville et al. (2004) suggested the need to apply
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multiple theoretical paradigms to model the relationship. Multi-theoretical

paradigms are collection of related ‘world views’ explaining the impact of IT on
improving organisations performance and gaining competitive advantage.
Therefore, to investigate the impact of IT on the competitiveness of construction
engineering and organisations, this research adopted multiple theoretical concepts
of process-based view; resource-based view and microeconomic-view in order to
develop a conceptual model. An extension of the conceptual model was suggested
using a non-parametric technique of data envelopment analysis (DEA).

2.1 Process-Based View

Porter (1998) argues that competitive advantage comes from creating value for
buyers that exceeds the costs of generating it. He suggests that a systematic way
of examining an organisation’s business processes and how the individual activities
interact to gain competitive advantage is by analysing the organisation’s value
chain. An organisation gains competitive advantage by performing these
strategically important activities more cheaply or better than its competitors
(Porter, 1998). Thus, Porter’s value chain concept satisfies process-based view
which postulates that IT investments create competitive advantages by improving
operational efficiency of intermediary business processes which in turn, under the
appropriate conditions, lead to better firm-level performance (Barua et al, 1995;
Qing and Jing, 2005). Using this paradigm a typical construction value chain was
developed, which consist of five primary activities: strategic planning, engineering
design, procurement, construction and start up and operation & maintenance.

2.2 The resource-based view (RBV)

The resource-based view (RBV) proposed that the deployment and exploitation of
valuable, rare resources, and capabilities contributes to an organisation’s
competitive advantage, which in turn contributes to its performance (Barney,
1991). Based on this theory it could be argue that IT-enabled strategy can improve
firm performance by creating sustainable competitive advantage via unique,
immobile, and path-dependent strategic resources and capabilities (Newbert,
2008). To satisfy this requirement complementary resources such as culture and
work environment are incorporated in the model as independent variables.

2.3 Micro Economic Theory

The microeconomics-based view postulates that IT investments create excess

return over other types of capital investments in production processes of
organisations (Dewan and Min, 1997). Microeconomic theory is useful in
conceptualizing the process of production and providing empirical specifications
enabling estimation of the economic impact of IT (Melville et al., 2004). This led to
the argument that microeconomic production theory is the natural choice for
investigating the productivity impact of IT (Mukhopadhyay, et al., 1997). In
microeconomics, the combination of feasible inputs and outputs is called the
productivity possibility set (PPS). The economic view of IT value is that of input in
the production function of an organisation and there is a substituting effect between
IT and other production factors (Dewan and Chung-ki, 1997). The concept allows
estimation of the measure of IT resources usage as an economic production
function using a non-parametric technique such as DEA.

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2.4 Competitive Advantage

Competitiveness is an elusive and multidimensional concept with no universally

accepted definition. Thus, there is a plethora of theories explaining how
organisations could achieve competitive advantage. Porter (1998: 11) equates high
performance to a sustainable competitive advantage, while Powell (2001) views the
two construct conceptually distinct. Nevertheless, it is expected that the
performance of firms that are able to attain competitive advantages will be greater
than the performance of those firms that are not (Newbert, 2008). Thus,
competitive advantage is operationalized as better organisational performance.

3. Research Conceptual Model

The contribution of IT to the improvement of various measures of organisation’s

performance metrics such as productivity, profitability, cost, differentiation and
market share is variously termed as “IT business value”, “strategic value of IT”,
“strategic advantage”, “competitive weapons”, and “IT-dependent strategy” by
different researchers (Melville et al.,2004; Piccoli and Ives, 2005; Oh and
Pinsonneault, 2007). Thus, IT business value (ITBV) is viewed as the outcome of
deploying IT resources in the execution of the associated work functions within
engineering and construction projects value chains on the projects’ performance
metrics including cost, schedule, profitability, safety and stakeholders’ satisfaction.
Adopting multiple theoretical concepts of process-based; resource-based and
microeconomic-views, Kassim et al., (2009) developed a conceptual model for
evaluating ITBV in the organisations.

4. Variables Constructs and Measures

IT resources improve productivity in construction organisations by supporting the

delivery of organisation's value chain and cause sustainable improvement in its
competitive position (Bharadwaj, 2000). These resources are termed as IT
infrastructure (ITI) and are conceptualized in four dimensions: shared technical
components, IT Human competence, IT applications, and business process (Bhatt,
2000). The measure of the IT resources is conceptualised as level of usage rather
than their monetary value (Tallon and Kraemer, 2007). The measures of the
organisation’s performance metrics are used as dependent variables. With the
industry being project-oriented in nature, a focus on the aggregation from project
performance to organisational performance has been recognized. Therefore,
schedule and cost performance, customer satisfaction, safety performance, growth
in contracts and profit are adopted as the dependent variables (El-Mashaleh et al.,
2006 and Kassim et al., 2009), which will sum up to the organisation's
performance. The dimensions for measuring the inputs and output variables are
presented in Table 1 below.

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Input Metric ( x i ) Output Metric ( y )

r

Schedule performance
Measure of shared ITI Cost performance
Measure of IT human capabilities Customer satisfaction
Measure of IT business applications Safety performance
Complemetary resources Contract growth
Overall profitability
Table 1: Dimension of Input and Output Variables (Kassim et al., 2009)

5. Research Methodology

For many decades there has been a fervent debate over the choice of paradigm to
conduct research by several disciplines. Similar debates within construction
management field have been raging too (Seymour and Rooke, 1995; Raftery et al.,
1997; Runeson, 1997; Seymour et al,. 1997; Chau et al., 1998; Holt and Faniran,
2000). The proponents of phenomenological inquiry insist that there is a need to
apply a naturalistic approach when investigating issues related to construction
management in order to understand the phenomena within its contextual setting.
The positivists however argue for quantitative measures to help test hypotheses
and possible generalization. Raftery et al.(1997) argue for a case where multi-
paradigmatic approach is embraced. Chau et al.(1998) suggest pragmatic approach
is likely to generate practical solution since construction management is a practical
subject. Peter et al.,(2002) are of the view that construction management research
should be in an era of methodological pluralism and paradigm diversity. Underlying
the debate on the choice of a research paradigm is the argument of
incommensurability of the positivist and interpretive paradigms (Burrell and
Morgan, 1979). However, Kirkwood and Campbell-Hunt (2007) reported that
multiple paradigms can be bridged while recognizing each paradigm's different
world views and assumptions in epistemological and methodological pluralism
approach. Furthermore, research methods can be detached from a paradigm and
use critically, within a context that makes different assumptions (Minger 2001).
Therefore, both qualitative and quantitative orientations can be used at different
stages of a research as a form of triangulation (Denzin, 1989).

Fig 2: Research Paradigms and Methodologies Adapted from (Crotty, 2003: 5)

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The research process involves different phases that pose different tasks and
problems. However, the ontological position for the research is constructivism as
depicted in Figure 2.This is because the research is investigating the how IT impact
on the organisation’s performance as socially constructed by the interaction
employees and environment. The first phase of the research involved a
comprehensive literature review in the relevant fields, which led to the
development of a conceptual model using multiple theoretical concepts as a
framework and hypotheses developed addressing the research objectives and
scope. Thus, at this level the research adopted a deductive approach (Loose, 1993)
with objectivism and positivism views because of the reliance on the current body
of knowledge to develop the research model and hypotheses (Sutrisna, 2009). The
second phase involved validation of the proposed conceptual model and the
engineering and construction value chain through unstructured interviews in the
form of case studies of selected firms. The choice of case study strategy at this
phase of the research is informed by the requirement to carry out a holistic in-
depth investigation of the complex phenomenon of IT business value of a
construction organisation within the context it occurs (Yin 1994). Thus, a
phenomenological view was adopted under this phase. The validated conceptual
framework is then extended and modified through mathematical modelling using
Data Envelopment Analysis (DEA). For data collection phase; a survey
questionnaire is designed to include closed-ended items with numerical responses
as well as open-ended items that could support discovery of new information. Thus,
as argued by Lewis & Grimes (1999), in analyses of a common phenomenon
paradigm images need not operate at the extremes, but may overlap and foster
counterintuitive insights.

6. Data Envelopment Model of ITBV

DEA is a mathematical programming technique that uses multiple inputs and

outputs to construct piece-wise linear convex production frontiers and measure
relative efficiencies within a group of decision making units (DMUs) such as
engineering and construction organisations. The technique was first proposed by
Charnes et al. (1978) and later extended by Banker et al. (1984). The relative
efficiency of a DMU is defined as the ratio of multiple weighted outputs to multiple
weighted inputs. The merit is that the weights of factors are not assigned in
advance and the weights used for each DMU are those which maximize the ratio.
DEA is used for performance evaluation of DMUs in public and private sectors
(Chang and Chen, 2008) along with benchmarking organisations (Wöber,
2007).The term 'envelopment' reflects the fact that DEA measures efficiency within
a production possibility set which ‘envelops’ all input-output correspondences. A full
description of DEA can be found in many texts such as (Thanassoulis, 2003).

Consider N number of engineering and construction organisations referred to as

DMUs each utilizing sets of IT and complimentary organisational resources as input
vector x   m to execute projects involving engineering design, procurement and
construction activities leading to the project performance outcome as output vector
y   s including measure of cost and schedule performance, contract growth and
profitability. The production possible sets (Φ) is given by    x, y  x can produce y .
Using the output oriented model the efficiency of the j 0 construction organisation
under consideration could be evaluated by solving the following linear programming
problem:

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 *  max   r y rj 0 , s.t.   i x ij  1 ,   r y rj    i x ij  0 , i , j;  r , i    0; r ,i (1)

S M S M

r 1 i 1 r 1 i 1

xij,yrj>0 are indexes of IT and other resources and performance metrics as inputs
and outputs of the jth construction organisation respectively, αi and μr are the inputs
and outputs weights. xio and yro represent the variables for coo . Equation (1)
maximizes the weighted output of the j0 organisation subject to the constraint that
weighted inputs equal one. The optimal vector weights *, * represents that
weights that will provide the organisation under consideration with the highest
efficiency rating possible, while maintaining feasibility for the remaining N-1
organisations in a given N sample groups. The values of * and * may vary for
each organisation as unit evaluated. The equation needs solving N times, once for
each organisation. The dual form of equations (1) is provided below. This form
provides information on how inputs and outputs of inefficient DMUs can be adjusted
as indicated in their respective slacks in order for them to be considered efficient.
M
 S

i 1 r 1
N

 *  max     S i   S r , s.t.   j y rj  S r   y ro ,  j  0 , i , j ,   j  1
j i
N

j i
(2)

* represents the efficiency score of an organisation s and sr are the input and
i


output slacks, respectively. An organisation is efficient if, and only if, *=1 and si*
= sr* =0; i, r ; an organisation is weakly efficient if *=1 and si*  0 and/or sr* 
0; i, r ε > 0 is non-Archimedean element.

7. Pilot Study

A pilot survey was conducted to empirically test the research concept. The
questionnaire is designed based on five-point Likert scale for measurement of the
input and output variables. Sixty engineering and construction organisations were
targeted with 40% responses. The survey covered measures of IT business
applications (ITBA), IT shared infrastructure (ITSI), IT human skills (ITHS) and
business work environment (BWE) as inputs. The output variables are the cost and
schedule performances (COST and SCHD); SAFETY, customer satisfaction (CUST),
contract growth (CONTR) and profitability (PROFI).
Input/Output Data Efficiencies
DMUs ITBA SCHD COST CUST CRS VRS
A 4.6 1.0 2.0 2.0 37 50
B 4.0 4.0 3.0 2.0 65 80
C 3.5 4.0 5.0 2.0 98 100
D 3.8 3.0 3.0 3.0 67 75
E 4.0 4.0 3.0 2.0 66 80
F 3.2 4.0 4.0 3.0 86 95
G 4.2 3.0 3.0 2.0 50 60
H 4.6 2.0 3.0 4.0 76 100
I 3.8 2.0 2.0 1.0 36 40
J 4.3 2.0 2.0 2.0 40 50
K 3.7 5.0 5.0 3.0 92 100
L 2.8 3.0 3.0 2.0 73 100
M 5.0 2.0 2.0 2.0 35 50
N 3.7 4.0 3.0 2.0 70 80
O 4.0 2.0 1.0 1.0 33 40
P 3.5 5.0 5.0 4.0 100 100
Q 4.4 4.0 3.0 1.0 60 80
R 4.3 2.0 2.0 1.0 32 40
S 3.7 4.0 4.0 4.0 94 100
T 3.3 5.0 4.0 3.0 100 100

Table 2. Data and results of the pilot study

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For the purpose of this paper however, the impact of ITBA on the COST, SCHD and
CUST was evaluated. The measure of efficiency obtained for each organisation is
relative to the PPS, thus, the efficiency measure tells us how an organisation can
improve its performance relative to the benchmark (Thanassoulis, 2003). The first
efficiency measure Table 2 is based on constant return to scale (CRS) output-
oriented model equations (1). The model assumes that an increase in organisation’s
inputs produces a proportional change in its outputs. Only two organisations (P and
T) are found to be efficient based on this model. In order to provide for the
differences in the scales of operations across the organisations, a variable
return to scale (VRS) DEA model in equation (2) is used to evaluate the IT-
induced performance. This model assumes that an increase in organisation
inputs does not produce a proportional change in its outputs. Therefore, an
inefficient organisation is only ‘benchmarked’ against organisations of a similar size.
The example illustrates the potential of DEA for extracting useful information
related to the IT business value. It is possible to identify organisations that operate
at the highest efficiency in terms of maximum output using minimum input. For
organisations that operate at less than 100% efficiency, the slack variables provide
an indication of how much the output should be improved for the same level of
ITBA utilization in order to match the performance of more efficient firms.

8. Conclusion

The paper presents a theoretically structured framework and empirically tested

model for evaluating impact of utilization of IT resources as factors of ‘production’
on the performance of engineering and construction processes using a non-
parametric technique. It is shown that a frontier that ‘envelops’ the most efficient
organisations can be identified using this approach, thereby proving a basis for
benchmarking the performance of similar organisations. The input variable is
directly related to investment and utilization of IT, while the output variables are
directly related to the delivery of engineering and construction value chain. The use
of slack based DEA model provided information on how the inputs and outputs of
the inefficient organisations can be adjusted in order that they will become Pareto-
efficient. Thus, this approach has mitigated the difficulties associated with lack of
theoretical framework in modeling ITBV, the prior assumption required for the
relationship between IT investment and firm performance, and the arbitrary and
subjective assigning of weights to the variables in the previous studies.

9. References

Banker, R. D.; Charnes, A.; Cooper, W. W.(1984) “Some Models for Estimating Technical and Scale Inefficiencies in
Data Envelopment Analysis.” Management Science, Sep, 30 (9), pp.1078-109
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pp. 99-120
Barua, A.; Kriebel, C. H. and Mukhopadhyay, T.(1995) “Information Technologies and Business Value: An Analytic
and Empirical Investigation.” Information Systems Research, Mar, 6 (1), pp. 3-23
Bharadwaj, A. S.(2000) “A Resource-Based Perspective on Information Technology Capability and Firm Performance: An Empirical
Investigation.” MIS Quarterly, 24 (1), pp. 169-197
Bhatt, G. D.(2000) “Exploring the relationship between information technology, infrastructure and business process
re-engineering,” Business Process Management Journal; 6 (2), pp. 139-163
Broadbent, M. Weill, P. Clair, D. and Kearney, A.T.(1999) “The Implications of Information Technology Infrastructure
for Business Process Redesign”. MIS Quarterly, Jun, 23 (2), pp.159-18
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Burrell, G., and Morgan, G.(1979) “Sociological paradigms and organizational analysis,” Portsmouth, NH: Heinemann
Charnes, A.; Cooper, W. W.; Golany, B.; Seiford, L. and Stutz, J.(1985) “Foundations of Data Envelopment Analysis
for Pareto-Koopmans Efficient Empirical Production Functions,” Journal of Econometrics, Oct/Nov, 30 (1/2),
pp.91-107
Chau K.; Raftery, J. and Walker, A.(1998) “The baby and the bathwater: research methods in construction
management.” Construction Management & Economics, Jan, Vol. 16 Issue 1, p99, 6p
Chen, Y.; Liang, L.; Yang, F. and Zhu, J.(2006) “Evaluation of information technology investment: a data
envelopment analysis approach.” Computers & Operations Research, 33 (5), pp.1368-1379
Crotty, M.(2003) “The Foundation of Social Research: Meaning and Perspective,”ed., SAGE, London
Dewan, S. and Chung-ki M.(1997) “The Substitution of Information Technology for Other Factors of Production: A
Firm Level Analysis.” Management Science, 43 (12), pp.1660-1675
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Kassim, Y., Underwood, J. and Raphael B.(2009) “Modeling IT Business Value for Construction Industry: A
Conceptual Approach.” Proceeding of the 9th International Postgraduate Research Conference (IPGRC 09),
(29-30 Jan) Salford.
Kirkwood, J. and Campbell-Hunt, C.(2007) Using multiple paradigm research methodologies to gain new insights into
entrepreneurial motivations.”Journal of Enterprising Culture, Sep, 15 I(3), pp.219-24
Kohli, R. and Devaraj, S.(2003) “Measuring Information Technology Payoff: A Meta-Analysis of Structural Variables
in Firm-Level Empirical Research.” Information Systems Research, Jun, 14 (2), pp. 127-145
Loose, J. (1993), A Historical Introduction to the Philosophy of Science, 3rd ed., Opus, Oxford.
Marianne W. Lewis and Mihaela L. Kelemen.(2002) “Multiparadigm Inquiry: Exploring Organizational Pluralism and
Paradox”, Human Relations, Feb; 55(2), pp. 251 - 275
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An Integrative Model of IT Business Value.” MIS Quarterly, Jun, 28 (2), pp. 283-323
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Research, Sep, 12 (3), pp.240-260
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investigation of the resource-based view of the firm,” Strategic Management Journal 29 (7) pp. 745-768
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Conceptual and Analytical Approaches.” MIS Quarterly, Jun, 31 (2), pp.239-265
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Construction and Architectural Management 9 (4), pp. 294–303
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Review And Synthesis of The Literature.” MIS Quarterly, 29 (4), p747-776
Porter, M. E.(1985) “Competitive advantage.” New York: Free Press
Porter, M. E.(1998) “Competitive advantage: Creating and sustaining superior performance,” New York: Free Press
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AA112

PROMETHEUS Construct: A Societal and Environmental

Responsibility Framework for Medium, Small and Very Small
Construction Companies

Triantafyllos Katsarelis
(Scientific Associate, Centre for Construction Innovation, National Technical
University of Athens, Greece)

Iliana Adamopoulou
(Student, National Technical University of Athens, Greece)

Abstract
The issues of Societal and Environmental Responsibility are related to the holistic
approach of Sustainable Development and remain at top level of priority for
theoretical and applied research. The framework PROMETHEUS addresses these
issues, oriented to Greek Medium, Small and Very Small, private owned
Companies, valorising a number of elements from recognized and widely in use
models of Business Excellence and frameworks for Corporate Social Responsibility.
It is constructed to be friendly and easy-to-use for owners / managers of all levels
of formal managerial education. In this paper a specialised version “PROMETHEUS
Construct” of the framework is presented, targeting the sector of construction
projects. The businessperson records key elements of the permanent organisation
and project methods, in the form of questionnaires, and then uses the toolbox,
which includes material such as charts and tables, to help him towards the goal of
leading the business in continuous improvement of Economic, Social /Societal and
Environmental Results.

Keywords
Societal and environmental responsibility, Business development, Medium – Small
and Very Small enterprises, EFQM PE Model, IPMA PE Award

1. Introduction

Organisations in the private sector survived historically by generating maximum

profits for their partners or shareholders. Today this approach is simply not enough
to guarantee survival for every type of organization. All organizations (small or big
– for profit or not for profit – producing or delivering services) are obliged to
account for the social, environmental and economic impacts that they have on
every community in which they operate, as well as on the natural environment.
They operate under a provisional license, given by the society and they constantly
have to prove that they leave a beneficial mark on the human and natural
environment. Therefore they have to incorporate into their business practices
economic, social and environmental actions that are beyond the ones imposed by
legislation and are connected with all those affected by the business’s activities. Of
course, keeping positive and balanced results for the community, the business and
the environment is not always easy. That is why a number of models and
frameworks have been developed, enabling businesses to choose the ones that best
fit their needs, their size and their development phase. The PROMETHEUS
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framework is based on international models and provides a friendly, flexible and

easy-to-use tool especially targeting the needs of medium, small and very small
businesses.

2. Characteristics and particularities of Medium, Small and Very

Small Businesses

It is imperative to determine the special characteristics of medium, small and very

small sized businesses, as these particularities shape their needs. We cannot simply
regard them as large businesses of a smaller scale or as future large businesses in
an embryonic state. In a medium, small or very small business the personality of
the owner/manager plays such a vital role that influences its function. The
relationships and the communication structures in the daily routine are rather
informal and considerably less based on hierarchy. The management style is
different and the work delegation less rigid. Of great importance are the
interpersonal relationships between co-workers and the motivation methods used
have to be more personalized.

Apart from their characteristics, we have to recognize the differences in medium,

small and very small businesses. Nowadays it is possible to be small and
successfully remain small because it suits you better! A smaller size does not mean
less complexity or easier management, but does lead to a different approach. There
are significant differences between the various branches and even regional ones.
Although models on business development and management do exist, to simply
transfer these models, which are based on and target large businesses, to medium,
small and very small ones would be rather misleading.

Many argue that medium, small and very small businesses are not capable of
implementing societal and environmental programmes, unless it is an action
outside the scope of the business and the business owner is morally and
ideologically motivated. Such actions would not have an effect on the internal
structure and organisation of the business. Others believe that medium, small and
very small businesses are oriented towards actions with the sole objective of
internal improvement without any effects on other environments, or have only their
own benefit (e.g. profit) in mind. It is high time to see past these myths and
superstitions. Societal and environmental responsibility is more than an emerging
trend; it is a necessity. The new internationalized economic environment appears to
have strengthened the connection between success and responsibility in medium,
small and very small businesses, even if not in an obvious way. These businesses,
in their straggle to remain in the market, have to take into consideration new,
social and sometimes intangible demands, such as:
 know-how improvement and careful human resource management
 quality control of products (or services), systems and internal communication
 pursuit of innovation.
These actions have a positive effect on the business’s profit because they lie on the
very core of the business activity. The owner of a medium, small or very small
business cannot ignore the social impact of his activities and his relationships with
the external environments are direct and personal. There is also the need for social
recognition: his is a factor of local development and by personally engaging in such
actions, he emerges in the social, economic and cultural reality.

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3. The PROMETHEUS Framework

The PROMETHEUS framework is especially developed for medium, small and very
small businesses, as a flexible, easy-to-use tool (containing two parts: a set of
questionnaires and the toolboxes), open to improvement. It is not an external
rating and evaluating model that rejects businesses who want to implement it, but
aims at bringing out their best features. It is largely based on the EFQM Excellence
Model. Other frameworks that have influenced PROMETHEUS are the European
Corporate Sustainability Framework ECSF and the Small Business Journey BITC.

Fig. 1: The EFQM Excellence Model for Organisations

The first step of PROMETHEUS (self-knowledge) targets the introduction of the first
four criteria of the EFQM Excellence Model. The second step (self-evaluation)
targets the introduction of the fifth criterion along with the in depth knowledge of
the first four. The third step (self-assessment) targets the introduction to the last
four criteria along with the in depth knowledge of the first five. At this point, it is
important to notice that the toolboxes for the last two steps are under construction.
Meanwhile, specialized versions of the PROMETHEUS framework are under
development for various sectors of businesses, such as PROMETHEUS – Construct
for the corresponding sector.

PROMETHEUS bases the activity of social and environmental responsibility oriented,

medium, small and very small businesses on four pillars:
 the professionalism of the business owner
 the central role of learning and the pursuit of innovation
 the orientation of the business to quality
 the open mind of the business owner and the recognition of the value and the
necessity of the participation in networks.

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PROMETHEUS is developed on Spiral Dynamics; there is evolution from one level to

the next, but each new level maintains and incorporates the positive elements of
the previous levels.

INITIAL RESPECT COMPENSATIVE TEAM NETWORKING

LEVEL FOR RULES BENEFIT EFFORT

Fig. 2: Spiral dynamics

The business is assisted in finding its current place in the continuum and deciding
whether to proceed forward. In the initial level where the business requires
improvement, the value of the connection between societal and environmental
responsibility on one hand and corporate development on the other is unclear and
the possibilities of volunteering actions are limited. It is thus possible to react to
external incentives or pressure, such as stricter legislation or pressure from
customers. In the “Respect for rules” level, the value of the connection between
societal and environmental responsibility and corporate development can be traced
and leads to an effort to comply with existing legislation and moral values. It is also
possible that the business reacts in a positive manner to issues of charity and
donation, even if not systematically. In the “Compensative benefit” level, the value
of the connection between societal and environmental responsibility and corporate
development is recognized insofar it has a positive economic effect, whether direct
or indirect. The business orients its operation towards social, environmental and
ethical practices through systematic actions, recognizing opportunities for growth.
In the “Team effort” level, the value of the connection between societal and
environmental responsibility and corporate development is integrated in the
operation of the business, over-exceeding its legal obligations. The business bases
its operation on the principle that economic, social and environmental aspects are
equally important.

The first step of PROMETHEUS addresses the issue of self-knowledge. The business
owner has to fill two questionnaires with four topics of several questions each, as
shown in table 1. It is important to stress that there are no correct and incorrect
answers and that the real present situation of the business has to be described.

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The way we think The way we operate

Which is the role and the influence of What are the characteristics of our
employees on the business? customers?
Which is the relationship of the What are the characteristics of our
business with the natural products (or services)?
environment?
Which objective best describes the When are we satisfied with the
business? course of the business?
Which principles and values are the What do we expect the business to
most important for the business? gain by getting involved in social
and environmental responsibility
issues?

Table 1: Self-knowledge questionnaire topics

The accompanying tool helps translate the answers to all the questions into graphs
and charts that give a better view of the current conditions.

INITIAL
ΑΡΧΙΚΟ ΣΤΑΔΙΟ ΣΕΒΑΣΜΟ
RESPECT Σ
FOR COMPENSATIVE
ΑΝΤΑΠΟ ΔΟ ΤΙΚΟ TEAM
Ο ΜΑΔΙΚΗ
LEVEL RULES
ΣΤΟ ΥΣ ΚΑΝΟ ΝΕΣ BENEFIT
Ο ΦΕΛΟ Σ ΠΡΟEFFORT
ΣΠΑΘΕΙΑ

Fig. 3: Graph example of the first questionnaire “The way we think”

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ΔΗΜΙΟΥΡΓΙΚΟΤΗ
CREATIVITY
ΤΑ

FLEXIBILITY
ΕΥΕΛΙΞΙΑ ΑΠΟΤΕΛΕΣΜΑ
EFFECTIVENESS
ΤΙΚΟΤΗΤΑ

ΕΠΑΡΚΕΙΑ
EFFICIENCY
ΔΙΑΧΕΙΡΙΣΗΣ

Fig. 4: Graph example of the second questionnaire “The way we operate”

Creativity is a phase found in markets with no obvious display of actual demand.

The business needs to find new customers and introduce innovations in products or
services. This phase is also suited for businesses in an early stage of operation.
Effectiveness is a phase of a market with existing demand and where the customers
have specific needs, but are either not in the position of evaluating all the possible
solution or are not aware of all the existing products or services. Of importance is
the continuous effort to communicate with potential customers and try to
understand their behaviour. Efficiency presents itself in markets with constant
demand, where the customers are in position to compare the existing products and
services and choose according to their needs. The ratio of quality/price is decisive
for the competition. The business has to improve its products and control the costs.
Flexibility is a phase of exigent market demand, where the customers have some
clearly expressed needs and others that remain fussy to them. They are not loyal to
the business, but expect from it to line up with their unpredictable behaviour. The
business runs in a very fragile and changing environment and has to maintain the
costs to a viable level while satisfying the customer.

3.1 PROMETHEUS – Construct

In the construction sector, which works by projects, the above sited approach is
linked to the IPMA Model for Project Excellence.

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Fig. 5: The IPMA Assessment Model for Project Excellence

PROMETHEUS – Construct follows the general pattern of the PROMETHEUS

framework and in addition to the EFQM Model for the permanent organisation
mentioned above addresses the corresponding set of criteria of the IPMA Excellence
Model focused on projects in each step. There are additional questionnaires and
toolboxes focusing on the business’s projects that compliment the questionnaires
and toolboxes that focus on the business’s permanent organisation.

Whereas PROMETHEUS has already been adopted by a large number of medium,

small and very small businesses, including some from the construction sector,
PROMETHEUS – Construct has recently been tested by a sample of construction
companies in a pilot phase.
4. Conclusions
A comprehensive and easy-to-use tool has been developed for and adopted by a
large number of medium, small and very small businesses, helping them towards
the goal of continuous improvement in Economic, Social / Societal and
Environmental aspects. From the very beginning the aim was to specify this tool for
the various sectors of business activity. The present paper presents the results of
this specification effort for construction companies introducing PROMETHEUS –
Construct. This project is supported by the findings of the implementation of
PROMETHEUS – Construct in a sample of construction companies during a pilot
phase. Conclusions from this implementation and further refinement of the tool
should be expected in the near future.

5. References

CERFE (2004), “Guidelines for the dissemination of corporate social responsibility

among small and medium-sized enterprises”.
EFQM, “EFQM Excellence Model”.

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European Network for SMEs Research ENSR (2002), “European SMEs and social and
environmental responsibility”.
Hillary, R. (2002), “#evaluation of Study Reports on the Barriers, Opportunities and
Drivers for Small and Medium Sized Enterprises in the Adoption of
Environmental Management Systems”.
IPMA, “International Project Excellence Award”.
Katsarelis, T. (2007), “PROMETHEUS Framework for Medium, Small and Very Small
Businesses”.

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NGO1

Guidelines and Project Management Handbook for Greek Non

Governmental Organizations (NGOs)

Triantafyllos Katsarelis
(Scientific Associate, Centre for Construction Innovation, National Technical
University of Athens, Greece)

Dipl.Eng. Nikolaos Depountis

(Quality Advisor, Member of the BoD PM-Greece, Athens, Greece)

Iliana Adamopoulou
(Student, National Technical University of Athens, Greece)

Abstract
“APOPLOUS” was the outcome of a project assigned by the Coordination Committee
of “the Campaign of 800 Greek NGOs”, with the purpose of constructing a set of
“Values for Organization, Conduct and Practice” for Greek NGOs. The main
objective of the present study was to construct a comprehensive, easy-to-use
project management tool for Greek NGOs, as the second add-on to “APOPLOUS”.
An additional objective was to facilitate Greek NGOs to be certified under the Greek
ELOT 1429 & 1431-3 Standards for the “Managerial Capability of Organizations
implementing Projects of Public Interest”, thus ensuring their candidature for
European Union co-financed Projects. The authors based their study on the latest
International Competence Baseline version in use of the International Project
Management Association and specifically on the Austrian and the Greek National
Baselines. The guidelines and the standardised handbook contained in the add-on,
were used in a pilot phase by a selected sample of NGOs and their feedback is
included in the presented version.

Keywords
Project Management Standards, E.U. co-financed projects, APOPLOUS, Greek NGOs

1. Introduction

Three years ago the Coordination Committee of “the Campaign of 800 Greek NGOs”
assigned to its Scientific Committee the project of developing a set of “Values for
Organization, Conduct and Practice” to help Greek NGOs improve their
performance. The outcome of this project was “APOPLOUS”. The Greek word
“apoplous” means “sailing away” and it was used as an acronym meaning
“principles of commitment for all of us to the quality of functioning and organization
serving well our objectives”. This initial “Set of Values” is now established as a
“Code of Conduct”, being adopted by a large number of Greek NGOs. The present
study is the second add-on to “APOPLOUS”, providing a tool for Greek NGOs in their
continuous improvement journey, under the very spirit of this Code of Values for
Organization, Conduct and Practice.

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Meanwhile the Hellenic Organization for Standardization – ELOT developed and

issued the 1429 & 1431-3 Standards, which are maturity organization standards,
for the field of European Union co-financed Projects in Greece, which could also
affect NGOs’ candidature for such Projects. The additional objective of this study
was to facilitate Greek NGOs to be certified under these Standards. “APOPLOUS -
Code of Values, Organization, Conduct and Practice” for Greek NGOs and the ELOT
1429 Standard are briefly described. The “Project Management Guidelines and
Handbook” proposed by the authors are presented.

2. History and background

2.1 Apoplous

“APOPLOUS - Code of Values, Organization, Conduct and Practice” for Greek NGOs
(Katsarelis, Depountis et al. (2008)) was the outcome of a project assigned to the
Scientific Committee of “the Campaign of 800 Greek NGOs” by the Coordination
Committee. The final text was approved, went through the public enquiry procedure
and currently undergoes the procedure of formal acceptance by the interested
Greek NGOs, thus moving forward from a “Set of Principles” to a “Code of
Conduct”.

“APOPLOUS” is structured on six equally weighted “values” (Figure 1). In the

“APOPLOUS Code” a brief description of each value is provided. These principles do
not set aside the institutional articles of each organization, nor do they replace the
additional terms of function or their applied practices. On the contrary, they are
additional to the above, while enhancing them. They draw from the principles of the
EFQM Excellence Model and the IPMA Project Excellence Model (Depountis,
Katsarelis (2009)). Through the adoption of these Principles all organizations are
encouraged to use more sophisticated and standardized instruments to ameliorate
their performance, such as evaluation indicators, mechanisms of internal control,
prototypes and standards. After the initial release of APOPLOUS, the feedback from
NGOs raised the issue of a more in-depth document needed. So came the first add-
on: “Comprehensive Guidelines for the application of the principles of APOPLOUS”,
which contained more detailed documentation and some examples of application in
order to clarify the concept.

VISION & INDEPENDENCE

MISSION TRANSPARENCY
& REPORTING

PARTNERSHIP RESPONSIBLE
DEVELOPMENT ORGANIZATION
& NETWORKING & PRACTICE

CONTINUOUS FOCUS
IMPROVEMENT on
& INNOVATION EFFECTIVENESS

Fig 1: APOPLOUS
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The authors have proposed the graph shown in Figure 2, which depicts the
continuum of standardization for NGOs. This proposal was based on the most
widely accepted approach for Corporate Responsibility Codes (Leipziger (2003)).

Codes Norms
Values Principles of & Standards Models
Conduct Guidelines

Fig 2: The continuum for standardization for NGOs

The Scientific Committee, committed to materializing the vision of improving and

upgrading the Code, developed a second add-on presented in this paper. With the
development of the two add-ons, the APOPLOUS Code of Conduct is moving
forward towards becoming a Standard.

2.2 The ELOT 1429 standard: Background and field of application

The ELOT 1429 Standard for the “Managerial Capability of Organizations

implementing Projects of Public Interest”, along with the linked Standard ELOT
1430 – series, addresses the field of European Union co-financed Projects in
Greece. NGOs must fulfill the requirements of ELOT 1429 and specifically ELOT
1431 - 3 Standards.

Disregarding the field of application of these Standards, the authors strongly

believe that Greek NGOs should adopt, implement and follow in all their projects
any comprehensive set of “Project Management Guidelines” under the requirements
of APOPLOUS. This set of “Guidelines” must follow specifically the values of
“Responsible Organization and Practice”, “Focus on Effectiveness” and “Continuous
Improvement and Innovation”. The set of “Guidelines” proposed by the authors in
this paper is a step towards this goal.

3. Project management guidelines and handbook for Greek NGOs

3.1 Methodology

The scope of the study was to develop a comprehensive document, which would be
easy to use by the Greek NGOs who base their activity on volunteer work and lack
of trained full-time personnel. They actually are “Project Oriented” Organizations
usually supported by a “week permanent” Organization (Gareis, (2005)).

The authors based their study on the Project Management approach proposed by
the International Project Management Association – IPMA and specifically on the
latest International Competence Baseline – ICB 3 version in use and more
specifically on the Austrian National Baseline of PMA and the final draft of the Greek
National Baseline of PM Greece. Additional bibliography was used on project
management for NGOs (European Commission – EuropeAid Cooperation Office
(2004)).

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The guidelines and the handbook were reviewed for consistency, clarity and
usability during the pilot phase by a sample of Greek NGOs: “European Expression”,
“Cell of Alternative Youth Activities”, “ARCHELON – The Sea Turtle Protection
Society of Greece”, “2nd Holargos System of Sea Scouts”, “Gymnastic Athletic Club
of Holargos” and “ELIAMEP – Hellenic Foundation for European and Foreign Policy”.
This sample was selected in order to encompass a wide range of activities, fields of
action and organization size. These NGOs are committed to adapt the Handbook to
their specific operational needs and use it in a future project, with the help and
guidance of the authors. More NGOs, members of the “Campaign of 800 Greek
NGOs” will take part in this implementation phase.

3.2 Guidelines’ construction

The “Guidelines and Project Management Handbook” is a bilingual tool (in Greek
and in English), as many Greek NGOs have volunteers not fluent in the Greek
language, or collaborate with NGOs from other countries in common bilateral
issues, or even undertake projects abroad. The tool consists of two parts: the
Project Management Handbook and the Guidelines for the implementation of the
Project Management methods introduced in the Handbook.

The Project Management Handbook contains easy-to-use templates (see Table 1)

for all the sub-processes of a project (start, controlling, coordination and
closedown, together with the continuous marketing task). It also addresses the
issue of risk management, in a project risk register and with further risk analysis
and alternative scenarios, which need to be monitored constantly during the
project, and could be very useful in case the crisis management sub-process needs
to be launched. A special contribution (which is not included as a competence in the
ICB 3, but featured in the French National Baseline), associated with risk
management but also with the closedown sub-process, is the “Non-completed
project stop report” template, which inevitably has to replace the normal “Project
closedown report”, in case a project ends abruptly before its completion. The
templates can be filled using low cost software or even freeware, therefore the tool
represents an affordable solution even for small NGOs.

Distribution list Project list of dates

Project assignment Project communication
structures
Project objectives Project risk register
Pre-project and post- Risk analysis –
project phase analysis Alternative scenarios
Project objects of “Professional” liability
consideration insurance contract
Project rules Relationship to other
projects
Project cost plan Connection to the
Organisation’s strategy
Project resource plan To-do list
Project organisation Approval of work
chart packages
Work breakdown Minutes of meeting
structure
Project interested Project status report

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parties
Project work package Project score card
specifications
Project responsibility Project close down
matrix report
Project milestone plan To-do list: Remaining
work – Post-project
phase
Project bar chart Non-completed project
stop report

Table 1: Project Handbook contents

The Guidelines, apart from helping with the implementation of the proposed Project
Management methods, contain basic Project Management glossary and databases
(e.g. risk management register and potential interested parties register). Examples
of the Handbook templates and the Guidelines are shown in Figures 3, 4 and 5.

The Project Interested Parties Analysis and Graph

 The project Interested Parties analysis considers the relationship of the project
to its relevant Interested Parties (Stakeholders). These are the parties that have
an effect on, or are affected by the project and its results.
 This project Interested Parties graph is structured as: Project internal area:
Project organization (Project Owner or team + Project Manager + Project
Team), and Project external area: All relevant Interested Parties.
 The distance from the Project figure depicts the importance of the Interested
Party within an arbitrary scale: Critical – Important – Other.
 The correspondent mark depicts the assessed relationship “attitude” of the
Interested Party within an arbitrary scale: Negative – Neutral – Positive.
 The Analysis and corresponding Chart enables the Project Team to design the
actions to be planned in order to improve the relationships with each Interested
Party, using an “Importance/ Attitude” matrix.

Figure X: Typical Project Interested Parties Analysis graph

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Fig 3: Guidelines extract: Interested Parties Analysis

<Project name> RISK ANALYSIS

<NGO’s logo>
<Project No.>
ALTERNATIVE SCENARIOS

Risk

Risk cost Cost for preventing risk

Preventative actions

Contingency actions

Alternative scenario 1

Responsible

Cost Delay

Results




Alternative scenario 2

Responsible

Cost Delay

Results




Fig 4: “Risk analysis – Alternative scenarios” template

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<Project name> PROJECT SCORE CARD <NGO’s logo>

<Project No.>

Project objectives and context <Date 1> <Date 2> <Date 3> <Date 4>

Project objectives 1

Project objects of consideration 2

Organisation strategies 3

Other projects 4

Planning, controlling <Date 1> <Date 2> <Date 3> <Date 4>

Project progress

Project schedule

Project costs

Project resources

Project organisation <Date 1> <Date 2> <Date 3> <Date 4>

Project roles

Project communication

Project culture

Project teamwork

Project environment relationships <Date 1> <Date 2> <Date 3> <Date 4>

Overall <Date 1> <Date 2> <Date 3> <Date 4>

<Project name> 3

1 Very good
2 Good
3 Ok
4 Bad
5 Very bad

Fig 5: “Project Score Card” template

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4. Conclusions

A comprehensive “Guidelines and Project Management Handbook” tool, which would

be easy to use by the Greek NGOs who base their activity on volunteer work and
lack of trained full-time personnel, is proposed by the authors. The authors
targeted mostly the medium and small NGOs with the above characteristics, but the
proposed tool can also be used by the larger NGOs with more experience. These
“Guidelines” may support Greek NGOs to be certified under the ELOT 1429 and
1430-3 Standards and ensure their candidature for European Union co-financed
Projects. But, most of all, these ‘Guidelines” are a tool for their continuous
improvement (“kaizen” in Japanese), into their “journey towards excellence”, under
the very spirit of “APOPLOUS - Code of Values, Organization, Conduct and Practice”.

5. References

European Commission – EuropeAid Cooperation Office (2004), “Aid Delivery

Methods – Project Cycle Management Guidelines”.
Depountis, N. and Katsarelis, T. (2008), “APOPLOUS – Code of Values,
Organization, Conduct and Practice for Greek NGOs”.
Depountis, N. and Katsarelis, T. (2008), “Standards and Certification of NGOs”,
Proceedings of the 3rd National Conference on Standardization, Standards and
Quality”, Thessaloniki.
Depountis, N. and Katsarelis, T. (2009), “Project Management Guidelines for Greek
NGOs”, Proceedings of the 6th Conference “Standardization, Prototypes and
Quality: A means of Balkan Countries Collaboration”, Thessaloniki.
Gareis, R. (2005), “Happy Projects”, MANZ Verlag, Vienna.
Leipziger, D. (2003), “The Corporate Responsibility Code Book”, Greenleaf
Publishing Limited, Sheffield.

6. Other sources of information

Gaskin, K. (2006), “Risk Toolkit: How to take care of risk in volunteering – A guide
for organisations”, The Institute for Volunteering Research & Volunteering
England.
Gower (2000), “Handbook of Project Management”.
Harrington, H. and McNellis, T. (2006), “Project Management Excellence”, Patton
Press.
International Project Management Association – IPMA:
http://www.ipma.ch/Pages/default.aspx
PMI (2004), “A Guide to the Project Management Body of Knowledge – PMOBK”.
Project Management Association Austria – PMA: http://www.p-m-a.at/content.php
Project Management Association Greece – PM Greece: http://pmgreece.gr/

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AA064

Reengineering project scheduling with knowledge management

Konstantinos Kirytopoulos
(Assistant Professor, University of the Aegean, Chios, Greece)

Vassilis Stavrou
(Mechanical Engineer, National Technical University of Athens, Athens, Greece)

Elena Rokou
(Researcher, National Technical University of Athens, Athens, Greece)

Abstract
The aim of this paper is to provide an effective method for schedule reengineering
and optimisation through knowledge acquisition and corporate memory creation.
The core problem of schedule development is about defining each activity’s duration
as well as the right dependencies among project activities. Project – oriented
organisations specialised in one or more domains due to their experience can have
highly accurate project schedules and thus improved efficiency. The first part of the
proposed method consists of monitoring all the existing processes related to the
projects execution and the corresponding knowledge acquisition through monitoring
project results. The second part handles the creation of a corporate memory in the
form of a schedule prototype, along with all the needed processes in order to
update it after each project’s completion. The paper is illustrated with a case study
concerning the implementation of the method on a project in the construction
sector.

Keywords
Project management, Scheduling, Knowledge management

1. Introduction

Project time management includes the processes required to manage timely

completion of the project (PMI, 2008). The core processes of project time
management include activity definition, activity sequencing, activity resource
estimating, activity duration estimating, schedule development and schedule
control (PMI, 2008). The outcome of project time management is a project
schedule that includes start and finish dates of each activity. Even if no risks
appear, the project is unlikely to finish on schedule if either the duration of
activities or the definition of dependencies is not realistic (Diamantas et al., 2007).

It is quite typical, especially in small projects (in terms of duration and budget),
that the initial schedule does not match the real needs of the project and is used as
a wide approximation of activities definition, sequencing and duration estimating
that proves to be completely different from the real outcome. The impact of this
irregularity is clear during the whole lifecycle of the project causing conflicts and
stress among project team members and problems with the customer and the
relevant contracts.

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In this context the proposed paper aims to provide a structured approach for
schedule development in projects that will embrace real outcomes to future project
schedules. The proposed approach exploits knowledge management techniques and
builds on the organisational experience which comes up achieving the ultimate goal
of scheduling reengineering. The basic concept consists of tracking the real
outcome of projects belonging to the same category and then creating typical
schedules for the whole category that can be customized for any similar project.

The proposed approach is illustrated through a case study from the construction
industry and concludes with the benefits that may occur, the most important being
the creation of realistic schedules.

The rest of this paper is organized as follows: in Section 2 we describe the

objectives and the methodology of this study. This section is divided into two sub-
sections. The first one is devoted to the construction of a Corporate Memory able to
acquire the Knowledge of the enterprise. The second one handles the issue of
project schedule reengineering, which is also considered fundamental for the
effectiveness of the process. The paper is illustrated by a Case Study presented in
Section 3. The last Section of the paper consists of general conclusions and further
research possibilities.

2. Methodology

2.1 Knowledge management

In a business ecosystem that is becoming increasingly competitive, knowledge is a

critical factor for business activities (Kerschberg, 2001). Organisational knowledge
is recognised as a key resource and a variety of perspectives suggest that the
ability to organise and deploy knowledge dispersed across the organisation is an
important source of organisational advantage (Tsai & Ghoshal, 1998; Prusak 1997).
Knowledge management is a broad and rapidly expanding topic. Davenport has
defined knowledge management as “a method that simplifies the process of
sharing, distributing, creating, capturing and understanding of a company’s
knowledge” (Davenport & Prusak, 1998). The overall purpose of Knowledge
Management is to maximise the enterprise’s knowledge–related effectiveness and
returns from its knowledge assets (Wiig, 1997; Davenport, 2005).

Several kinds of knowledge can be found in an enterprise. The main distinction

defined by Nonaka and Takeuchi (1995) is explicit and tacit knowledge. Tacit
knowledge is not easily visible and expressible. It is hard to formalise, making it
difficult to communicate or to share with others. Tacit knowledge is more of a
personal nature, involving such intangible factors as personal belief and perspective
and it is embedded in individual experience (Nonaka & Takeuchi, 1995). Nonaka
and Takeuchi place great stress on the need to convert as much tacit knowledge as
possible into explicit knowledge in order that the knowledge can be shared. On the
other hand explicit knowledge can easily be represented in formal language, and
thus can easily be communicated among people.

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The whole Knowledge process (Van Heijst et al., 1997), as shown in Figure 1,
consists of four basic steps:

Figure 1: Stages of knowledge process

 developing knowledge through the ordinary day to day operations
 combining knowledge in order to extract and formalise the lessons learned
from the past activities
 distributing knowledge to all the members of the organisation who can make
use of it
 consolidating knowledge so individual knowledge can be made accessible to
others in the organisation who need that knowledge

For the schedule reengineering two basic methods were used to acquire knowledge.
The first one was interviewing experts to acquire tacit knowledge. This method is
based on linguistic transmission of expertise and although this method is simple
and very popular it has several drawbacks due to the fact that it is a time
consuming process (Kim & Courtney, 1988). The second method concerned the
acquisition of explicit knowledge through the documents and processes followed by
classification and structuring of the acquired information.

Based on the knowledge acquired with the above methods a corporate memory was
created. A corporate memory can be understood as a repository of valuable
knowledge generated by an organisation through its continuous activity (Alvarado
et al., 2004). Its basic principle is the maintenance of the past experience of the
company in a knowledge base in order to be reused effectively, when needed. The
deployment of a corporate memory is regarded as the most important turn to the
Knowledge Management approach. Hence, the corporate memory is a data bank,
which may include knowledge on products, production processes, standards and
requirements, customers, business plans and strategic goals and furthermore
financial information. Corporate memory is specifically structured for aggregated
knowledge, which is a specific high-level knowledge required at a business level.
The development of a corporate memory aims to give to the enterprise the
opportunity to reuse quickly and effectively the accumulated Knowledge and
moreover, to analyse and reason behaviours, actions and outcomes. Corporate
memory’s size is strongly depended on the size of the enterprise and consequently,
the bigger the size the bigger the effort for its development (Bellos et al., 2002).
Based on the above notions the proposed process to create and manage the
corporate memory is depicted in Figure 2:

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Figure 2: Knowledge Management Process

The proposed method for project schedule reengineering consists in developing a
corporate memory containing all the available knowledge generated by the
execution of past construction projects and is going to be analysed next. In relation
to the schedule reengineering the proposed method is presented in Figure 3.

Figure 3: Knowledge Management during project schedule reengineering

More specifically the idea was to create a basic corporate memory using all the
available past projects that would be the initial schedule prototype and then apply it
to the future projects. Each time that the prototype would be applied all the needed
customisations based on the case features would take place. Upon the completion
of each project of a specific type the prototype would be appropriately updated and
thus the corporate memory would also be updated. The aim is to create an
optimum schedule prototype that could be easily customised for any similar project.
As seen in Figure 3, each stage of the process requires or generates data for the
corporate memory and each time that data are generated should be organised and
get related to the data already residing in the corporate memory. Keeping the
corporate memory updated is a critical factor for its success (Tatsiopoulos et al.,
2002).

In the following section a case from the construction industry will illustrate the
application of the aforementioned method and its outcomes.
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3. Case Study

3.1 Company Description

The applicability of the proposed method has been tested in a company activating
in housing and office development. The company is part of a major group
operating, for over fifty years, in the sector of construction industry. Within this
period the group has executed a multitude of worth trying projects in several
countries. The group has achieved to be one of the most productive and effective
International Building and Civil Engineering Contractors, operating efficiently in
several countries, mainly in the Middle East, Asia, Africa and Europe.

The present study concerns the Greek market where the group begun operating in
seventies. The activities of the group have substantially expanded due to strategic
acquisitions and alliances with important contractors. The company has expanded
its business to neighbouring countries.

3.2 Proposed Method Implementation

The aim of the development of the aforementioned method was the scheduling
reengineering of the case study company. More specifically the idea was to create a
basic corporate memory using a specific type of construction project, namely
buildings refurbishment. The first schedule prototype inserted in the corporate
memory was the typical schedule that the company used in offers development for
such kind of projects. The company monitored the project’s execution and then
used the lessons learned in order to create a new schedule prototype that could be
customised for any similar project. Afterwards, the created prototype was applied in
a second project of the same category and the results were tracked and compared
to those provided by the first one. The continuation of the process will lead to the
filling of the corporate memory with reliable prototypes for as many project
categories as possible.

More specifically, the two initial projects that were used as inputs for the
enhancement of the corporate memory for this type of projects, referred to the
refurbishment of two similar buildings in order to host two bank branches. Herein, it
should be mentioned that the company has several long term agreements for this
kind of projects and is quite specialised in the sector. Thus, the company’s
personnel have acquired valuable expertise in the sector.

The company started the corporate memory by exploiting knowledge acquired by

its executives, project managers and stuff and built a schedule prototype containing
about 30 tasks commonly required in this specific type of projects. This schedule
was also used as a contracting agreement as far as schedule was concerned.

This project schedule was used as a basis for all the projects of the same type
although there were only estimations about its actual precision and integrity. This
lack of knowledge about the schedule’s accuracy was caused by the fact that no
retrospective analysis was done after each project’s completion and thus there were
no updates and refinements of the initial prototype. Thus, while the information on
past projects was available, it was not transformed into knowledge about the actual
tasks (appropriate level of the work breakdown structure) required for the
completion of each project, the needed resources and the encountered risks.

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In the effort of developing a reliable schedule prototype, the initial goal was to
exploit the existing knowledge residing in the company’s staff. Data were acquired
from the project calendars and company’s documents but also by interviewing the
company’s experts and extracting the knowledge from their experience.

The next step consisted of monitoring an on-going project of the same type and
keeping track of the initial schedule and the actual task duration and resources
allocation along with constant interviewing the responsible project manager in order
to get inside information about the causes of alterations on work breakdown
structure and resources. When this project was completed all the retrieved
information were used in order to track all the deviations from the initial project
schedule and their causes.

Based on these data the schedule prototype was updated giving a much more
analytical and precise schedule. More specifically the new project schedule
consisted of 70 tasks instead of the initial 30 to simplify the monitoring process and
durations were based on the previous projects findings. The basic differences were
identified in the level of analysis of tasks such as those related to electrical
engineering (electrical fittings etc) as well as those that had to do with hydraulics
(sanitation – plumbing etc). These types of tasks should be analysed further as this
is the only way for assigning the right precedence constraints.

The main outcome of this endeavour was that the company managed to come up
with the appropriate level of analysis in the work breakdown structure that in turn
was expected to lead to a more effective and efficient project management. This
generic prototype was customised to another project of the same category so that
the integrity of the work breakdown structure analysis, as well as the links among
tasks could be validated. For this new project 4 tasks of the prototype were not
relevant and thus were removed from the schedule. These tasks were relevant to
the formation of the outer space (e.g. landscape gardening). The monitoring
process followed during this second project, was exactly the same with the first
one. Upon the project’s completion a comparison of the actual tasks implemented
and those based on the prototype was done along with a discussion among the
members of the company in order to pin point the causes of changes and possible
ways of avoiding them next time. The results were entered in the corporate
memory and caused the schedule prototype to get readjusted.

Summarising the goal was to use the corporate memory in order to create an
accurate project schedule for building refurbishments and establish a dynamic
process of updating and optimising it through time. This schedule is going to be
used as a template for all future projects of this type. However, the executives for
each new project ought to do the appropriate modifications before using it.

Based on the data collected during the monitoring of the above analysed projects
the comparison analysis gave the following results:

 The first project used the initial work breakdown structure with 34 activities
but during its execution 38 new activities were added to accommodate the
project’s needs. There was a 52.78% difference between initial and final
number of activities.

 The second project used the updated schedule prototype having 66 activities
and only 1 activity was added during its execution. There was a difference of
1.49% between initial and final number of activities.
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In table 1 appear the relevant data about the two projects.

Project Number of initial Number of final Effectuated

activities activities Changes (%)
First 34 72 52.78
Second 66 67 1.49
Table 1: Initial and final number of activities in the two projects.

4. Conclusions – Further Research

The main points of the theoretical part concern the Corporate Memory use within an
organisation in order to reengineer its projects schedules. The Case Study is used in
order to give the practical appliance of the proposed method. The method
presented in this paper aims to lead to effective schedule reengineering and
optimisation through knowledge acquisition and corporate memory creation of
project oriented companies. Schedule prototypes created by the proposed method
can be accurate and optimise project management. As derived from the case study
the use of an elaborated schedule prototype significantly reduced the difference
between initial and final number of activities (refer to Table 1).

Taking into account the results of this research and the comments that we had from
the project team, we came up with the finding that the corporate memory as an
instrument for project schedule reengineering can essentially aid the project
management procedure.

As a conclusion we strongly recommend project managers to lead their teams

towards knowledge systems that can have a “high beneficial impact with also high
probability of success”.

It should be mentioned here that the use of project management software is of

extreme importance for the success of this endeavor. Having such a software in
place, the project oriented enterprise (such as those belonging to the construction
sector) may gather all the appropriate data from the construction field and enrich
its knowledge memory. As further research the authors are trying to apply the
proposed approach to more complex and bigger in terms of budget projects.

5. References

Alvarado, M., Romero-Salcedo, M. & Sheremetov, L. (2004). “A corporative

memory based on the user profiles”. Expert Systems with Applications, 26(1),
87-94.
Bellos, V., Kirytopoulos, K., Leopoulos, V. & Sfantsikopoulos, M. (2002).
“Innovative method for data collection and risk analysis during the bidding
process”, in proceedings of the Risk Analysis III Conference, WIT Press, UK.
Davenport, T.H. (2005), “Thinking for a Living: How to Get Better Performances
And Results from Knowledge Workers”, Harvard Business Press.
Davenport, T.H. & Prusak, L. (1998). “Working Knowledge: How Organizations
Manage What They Know”, Harvard Business School Press, Boston, MA, USA.
Diamantas, V., Kirytopoulos, K. & Leopoulos, V. (2007). “Project’s duration
prediction: traditional tools or simulation?”, World Review of Entrepreneurship
Management and Sust. Development, 3(3/4), 317-33.
Kerschberg, L., (2001). “Knowledge management in heterogeneous data warehouse
environments”, in proceedings of DaWaK., Springer, e-proceedings.
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Kim, J. & Courtney, J.F., (1988). “A survey of knowledge acquisition techniques and
their relevance to managerial problem domains”, Decision Support Systems,
4(3), 269-284.
Nonaka, I. & Takeuchi, H., (1995). “The Knowledge Creating Company”, Oxford
University Press, Oxford.
PMI, (2008). “A guide to the project management body of knowledge: PMBOK
guide” (4th edition), Project Management Institute, USA.
Prusak, L., (1997), “Knowledge in Organizations (Resources for the Knowledge-
Based Economy, Newton, MA: Butterworth-Heinemann.
Tatsiopoulos, I., Leopoulos, V. & Kirytopoulos, K., (2002). “Knowledge acquisition
for smoothing staff succession in SMEs”, in proceedings of the Fifth SMESME
International Conference. UK, 2002. 173-180.
Tsai, W. & Ghoshal, S., (1998). “Social Capital and Value Creation: The Role of
Intrafirm Networks”, Academy of Management Journal, 41(4), 464-76.
Van Heijst, G., Van der Spek, R. & Kruizinga, E., 1997. “Corporate memories as a
tool for knowledge management”, Expert Systems with Applications, 13(1), 41-
54.
Wiig, K.M., (1997). “Knowledge management: Where did it come from and where
will it go?”, Expert Systems with Applications, 13(1), 1-14.

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AA040
PM-PEDIA: An Open-Learning, Expert-Based, Mind-Mapping Tool for
Project Management Education

Dionisios Kontostavlakis
(Graduate Student, University of Piraeus, Piraeus, Greece)

Dimitrios M. Emiris
(Associate Professor, University of Piraeus, Piraeus, Greece)

Abstract
Efficient and coherent education in PM needs to couple the standards incorporated
in systematic yet concise methodologies (such as the ICB® or the PMBOK®), with
elaborated documentation, examples and evaluation tools, in order to corroborate
the learning material. A challenge in this attempt is that PM an inter-disciplinary
field and as such, the existing literature is vast and dispersed in various media
(books, articles, internet, etc.) Bringing the knowledge elements from standards
(which are mostly guidebooks) and textbooks together in a form acceptable by
learners and teachers, by maintaining the completeness and integrity of scientific
concepts, is a challenging task.

Keywords
Project Management, Mind Mapping, E-learning

1. Introduction

The primary purpose of this article is to present all the necessary elements for the
development of an online e-learning tool, and to correlate them in an effective way
in order to increase its adoption for educational purposes. E-learning is an essential
element in the majority of modern management teaching methods, so it could not
be excluded by one of the most distinguished branches of administration, namely,
project management.

The presented tool is an expert-based, adaptive and interactive online knowledge

database. Its objectives are to facilitate the introduction of beginner learners on
basic concepts of PM through the systematic formulation of process-oriented
methods, and to offer a self-evaluation mechanism that enables the evolution of
knowledge for the learner. The structure of the learning tool is much similar to the
structure of the PMI®’s, PMBOK® Guide.

This article is structured as follows. In Section 2, we briefly review the literature

and introduce basic concepts, we highlight the items necessary for the development
of the tool and stress the importance of e-learning in modern education; the key
differences between guidebooks and textbooks are also emphasized herein. Section
3 deals with the details of progressive development of the tool and the presentation
of the specialized mind mapping software (Mindjet® Mind Manager 8). Finally,
Section 4 illustrates the evolutionary characteristics of the model, stresses the
expert-based and adaptive aspects of the development, and justifies the name
PM-Pedia that we have given to the final product. The article culminates with
conclusions, contributions and guidelines for future research.

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2. Basic Concepts and Literature Review

2.1 Mind maps

A mind map is a diagram used to represent words, ideas, tasks or other items
arranged and linked to a central key, word or idea (Wikipedia, 2009). The elements
of the map (concepts) are usually enclosed in definite shapes of some type (nodes)
attached to each other by drawn lines. Frequently, words on the lines referred to as
linking words or linking phrases specify the density of the relationship between the
two concepts. As mind maps are considered to be critical for the final outcome of
the educational process, Jonassen (2000) indicates that the technique of conceptual
mapping is an intermediary, learning tool that promotes the development of new
knowledge, enhances interaction and involve people in cognitive processes for
analysis and critical encounter of the content of teaching, as well as the
organization and representation of knowledge, taking into account the social and
cultural environment.
Conclusively, through this particular mind mapping feature, this study makes an
attempt to embed mind maps in PM training. To achieve this, the PMBOK® Guide is
decomposed as described in Section 3, in order to facilitate a deeper
comprehension of its content for both the apprentice and the advanced user.

2.2 Electronic learning

The granted interactivity and efficiency in refreshing as well as enriching

information, thus knowledge, in combination with the potential of global access and
application from independent PCs everywhere in the world, have already
transformed the market interest for creation and utilization of e-learning tools, into
“a survival skill for corporations and individuals” (Cross, 1999). The most typical
characteristics of e-learning remain the ease in accessibility and handling of
information in a “self-paced” (Obringer, 2001) way, along with its applauded
adaptability, bringing users one step closer to its learning objectives. In addition to
that, “the matching of content and delivery vehicle to a learner's style, amplifies
retention and magnifies learning results”, as cited by Assumption University (2002).
At present, e-learning appears highly attractive to all, especially to companies that
want to reduce the cost of executives training hence the observed increase in
relative web pages attendance. The existence of ample material in digital form has
boosted the evolution of e-learning tools and practices. However, as Clark & Meyer
(2002) point out: “The technology that has lagged is the pedagogy and design
thinking and strategies required to make all of this digital information reusable and
targeted toward adding value”. The actual “trigger” in the development of the
present e-learning tool is the creation of an open-ended knowledge database based
on the structure of the PMBOK® Guide, while enriching it with scientific material,
lessons learned and case studies from open sources provided by the members of
the global PM community, thus creating a so-called PM-pedia.

2.3 Framework of PMBOK® Guide and its characteristics as

compared to a Textbook

Although the basic principles and structure of the PMBOK® Guide are used in the
development of this tool, supplementary learning elements enrich the structure of
the guide. The architecture and concept of the PMBOK® Guide can elegantly be
depicted on a mind map as it contains 42 processes grouped firstly in line with

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knowledge areas (in 9 PM processes) and secondly defined by the project life
cycle (in 5 is product-oriented processes) (PMI®, 2008, p.37). The relationships
between processes and their respective subtopics (inputs, outputs, tools &
techniques) are portrayed in a mind-map by hyperlinks. Further information is
provided in Section 3. Nevertheless, the PMBOK® Guide is a guidebook, not a
textbook. In that sense, it enumerates the tools and techniques, inputs and
outputs, step-by-step directions on processes, possibly some templates, but it
hardly elaborates on the application of these techniques, not does it give any
paradigm of application, a case study, or self-assessment opportunities; this is
rather the purpose of a textbook or of supplementary software products.

The distinctive difference between the present e-learning tool and traditional
textbooks and/or guidebooks for PM is thus that it unifies the positive
characteristics of textbooks, guidebooks and self-assessment tools under one roof.
Most important, however, is the fact that the developed tool is open, expert-based,
interactive and adaptive and it enables distance learning, in non-real-time. The tool
brings to the learner the combined benefits of formalistic thinking and open,
elaborate, moderated information. While a guidebook demonstrates how to “Do the
Right Things”, which is greatly useful and practical in handling situations in a
project, the developed tool is oriented towards “Doing the Things, Right”.

3. Elaboration of E-learning Tool

3.1 Step-by-step modeling

The building of the e-learning tool is achieved with the use of the Mindjet®
MindManager 8 specialized software. The procedure of modeling includes 4 steps:

Step 1
The ensemble of processes of PMBOK® Guide was recorded, documented and
allocated in the nine knowledge areas (PMI, 2008, p.37), decomposed up to
“activity” level. The main topic title is “PM-Pedia” followed by consecutive subtopics
concerning the forty-two processes and their respective inputs, T&T (tools &
techniques), outputs as dictated by PMI®. At the end of the map an extra chapter,
relevant with training and certification information based on PM issues, was added.

Step 2
T&T are there to support managers by providing ways to plan execute and monitor
the ensemble of PM processes, integrating scientific as well as expert-based
knowledge. Step 2 deals with the attempt to transform this particular guidebook
into a textbook, through the enhancement of suggested T&T with further scientific,
learning data directly accessible through the Web. Nonetheless, while “Alternatives
Analysis” technique (PMI, 2008, p.144) in the “Estimate Activity Resources” process
of Time Mgmt (PMI, 2008, p.141) consists an acclaimed method of “yielding options
if there are other ways to accomplish the activity” (Elyse, 2006) incorporating a
wide variety of learning sources; “Expert Judgment” on the other hand is expressed
in a more subjective way, because essential as it may be, it cannot be included in
any type of bibliography. Out of a total 131 T&T proposed by the PMI®, 74 of them
were subject to enrichment. The educational aspect of the tool is represented
through the addition of learning-related questions and answers at the end of every
knowledge area, that lead to evaluation of essential knowledge with a more
apprenticing perspective, than a plain preparation for credential aquiring.

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Step 3
Once the construction of the main body of the PM-Pedia has come to a mature
level, the elements are conceptually correlated; that is, outputs of processes are
fed as inputs to other processes. A typical example involves “Change Requests”
which as an output of “Direct and Manage Project Execution” process (PMI, 2008,
p.87), have to pass through “Monitor and Control Project Work” (PMI, 2008, p.92)
and finally arrive at “Perform Integrated Change Control” process, as an input (PMI,
2008, p.97). Evidently, the operational structure of mind maps facilitates
information feedback through simple hyperlinks, as it is clearly depicted in the final
form of the model.

Step 4
Once the PM-Pedia is developed as a robust and rich mind map, it is exported in
HTML format. The exported mind map is easy to use as a normal web page in a
learning environment. The respective exhibits throughout the evolution of the
model development are shown in the appendix.

3.2 Key features of the product

Digital illustration of the PM-Pedia

The structure of the model as a website and the near real-time data uploading
through an administrator are the main features of the tool, which provides
accessibility and availability among online users, and does not need extra portable
storing means, as in the case of an e-book or a software package. This is because
HTML applications have become the most widespread means of acquiring
information, both in the business and the personal levels.

Mind maps and the structure of PMBOK® Guide

In reality, mind maps are considered to be a dignified characteristic of a webpage,

but due to their suitability for PM education, they are even more important. Every
PMBOK® Guide process consists of incoming elements (inputs) that are being
processed with the necessary tools and techniques and conclude to results
(outputs) that are viewed as inputs to other processes. The importance of
information feedback during a project in association with the interactions between
processes prompts for the use of hyperlinks as a means of item conjunction within
an HTML application. Hyperlinks facilitate information gathering and accessing,
hence the inclination to an HTML based website as the definitive version of the
model.

Tools & Techniques Enrichment

The addition of online references in 74 out of 131, proposed by PMI®, T&T

transforms the PMBOK® Guide from a Guidebook into a Textbook and generates a
PM-Pedia. This transformation enables the user not only to consult the required
pathways to appropriately manage situations, but also to deepen his knowledge
and shape his administration style through a blending of online open-source tools.
In other words, added entries and links, imported comments and expert-based
reviews on the PM-Pedia elements, facilitates research, allows assessment and
broadens the spectrum of knowledge.

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Insertion of Questions & Answers

Self-assessment plays an important part in the conceived model. Questions and

corresponding responses were thus added and grouped into 9 levels, according to
the respective knowledge area. Questions relate to individual activities, processes,
T&T and critical situation evaluation. The plan for the future use of the model
requires that its content is operated under continuous renewal, holding the number
of questionnaires at a high level, according to the latest advances in the PM field.

3.3 PM-Pedia

The term of PM-Pedia was coined in order to define the evaluated model as a free,
web-based, open-source, PM e-learning tool and prompts to Project Management
(PM-) and encyclopedia (-pedia). The attempt was inspired by Wikipedia, the online
encyclopedia; however, instead of providing definitions and links to each tool on an
encyclopedia basis, the tool contains several appropriate online references in the
respective chapter and follows the structure of the PMBOK® Guide. As a result, PM
education is based on a formalistic, process-oriented framework elaborated with
practical methods and strategies that need to be followed in order to plan, execute
and control the project throughout its various phases, and to deal with any critical
or unexpected situations. The main concerns raised are:

 The evaluation and refining of received elements. A group of moderators

should be available, that will screen and improve data and transform them in
a way that makes them ready for publishing on the web pages.

 The need for a specialized administrator, responsible for the selection and
renewal of data received, the publication of evaluated and refined text on the
web pages (comments, reviews), and the handling of an online HTML-based
e-learning tool. In short, this website needs to be converted from its present
static form, to a refined, more dynamic form.

 The need for a website specialist and the requirement to host the dynamic
website on an online server. This is even more crucial, as every received
element has to be stored and at the same time made accessible to users.

4. Guidelines for the evolution of the e-learning tool

The main incentive for the development of the PM-Pedia is the realization that a
guidebook, although useful it may be, does not facilitate learning in the
mechanisms of tools and techniques, while most textbooks lack the formality of a
guidebook. The first attempt to create the PM-Pedia initiated as part of the
graduate dissertation of one of the authors. The developed “beta” model presently
operates in an experimental fashion, and is practically evaluated on a daily basis by
several undergraduate and graduate students. This gradually leads to the
transformation of the model to an integrated, dynamic, e-learning website built
upon the principles of PMBOK® Guide.

In the steady state, the required workforce should consist of the administrator, a
group of evaluators-editors (moderators) specializing in one or more cognitive
areas and other sub-moderators holding at least some basic PM knowledge. The
roles and responsibilities of each of these entities lies in the gathering of received
data and its classification in two main categories. During the first classification, they
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diversify the content into the following categories: “Expert-based Reviews & Hints”,
“Case Studies”, “Education & Credentials”, and “Employment & Workplace”. The
second classification deals with the categorization according to PMI®’s nine
“knowledge areas”. Following the initial information filtering, data concerning
“Expert-based Reviews & Hints” and “Case Studies” is posted to respective
moderators (based on the knowledge area in which they specialize), that are
responsible for a thorough evaluation, refining and editing appropriately the
context. The administrator's duties are thus limited to receiving documented text
from the moderators and posting it on the appropriate website domain. The
separation of domains follows a two-level classification identical to the
responsibilities of sub-moderators, after receiving users’ data from the
administrator.

Fig. 1: Website’s organizational structure. (Blue arrows represent received data,

which is distributed by the administrator to sub-moderators, evaluated,
processed by moderators-editors and finally recovered by the administrator,
ready for posting in the appropriate domains of the website.)

5. Conclusions, Contributions and Guidelines for the Future

The present work has set the basis for an interactive, adaptive, knowledge-based,
open e-learning tool, appropriate for apprentices, as well as PM experts. Learners
may use this tool for both training and self-assessment, even for preparation
towards a PMI® accreditation. The tool was developed using mind maps and the
Mindjet® Mind Manager 8 software as the foundation to model the PMI® defined
knowledge areas and processes and was then enriched in most of its elements. The
model was also exported into web pages for ease of use.

Through a continuous improvement and enrichment path, the product is gradually

being transformed to a PM-Pedia. The operation of the product requires the
participation of people with distinct roles and responsibilities as described herein.
The product is now on a broad evaluation phase in order to shape its final form.
Future actions contain the further enrichment of the model, the addition of a
scoring module, the inclusion of case studies, etc.

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6. Appendix
Step-by-step development of PM-Pedia mind map (Mindjet® MindManager)

Fig. 2: Mapping of the PMBOK® Guide processes into mind maps. (Step 1)

Fig. 3: T&T enrichment with online scientific and learning material. (Step 2)

Fig. 4: Conceptual process correlation through hyperlinks, and addition of

relationships in interrelated activities. (Step 3)
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Fig. 5: Export of mind map into web pages and options parametrizing through the
software menu (Step 4)

References

Wikipedia. Mind Map - from Wikipedia, the free encyclopedia. Retrieved on January
15, 2010 from http://en.wikipedia.org/wiki/Mind_map
Project Management Institute. (2008) A guide to the project management body of
knowledge (PMBOK®Guide – Fourth Edition). Newtown Square, PA: Project
Management Institute.
Elyse. (December 4, 2006). Activity Recource Estimating. Retrieved on January 12,
2010 from http://www.anticlue.net/archives/000768.htm.
Assumption University. (2002) E-Learning System and Technology Concept,
Assumption University. Retrieved on January 20, 2010 from
http://cai.au.edu/concept/index.html
Clark, R., & Mayer, R. (2002) E-learning and the science of instruction. San
Francisco, Jossey-Bass.
Obringer, Lee Ann. (October 1, 2001). How E-learning Works. Retrieved on January
17, 2010 from http://communication.howstuffworks.com/elearning.
Jonassen D. (2000) Revisiting Activity Theory as a Framework for Designing
Student - Centered Learning Environments, In D. Jonassen & S. Land (Eds).
Theoretical foundations of Learning Environments, LEA
Jay Cross, CEO (1999) E-Learning - Winning Approaches to Corporate Learning on
Internet Time [Electronic Version]. Berkeley, California: Internet Time Group.
Retrieved on January 18, 2010 from
http://internettime.com/itimegroup/elearn.htm

All figures were exported as images by Mindjet® MindManager 8 (trial version).

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SPM01
Lessons Learned from the Development of a Project Management
Suite

Pavlos Laoutaris
(Task Force co-ordinator, MOU sa, Athens, Greece)

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AA054

Comparative evaluation of project management standards

Paschalis – Anastasios Loukas

(Project Manager, OTE SA, Athens, Greece)

Athanasios P. Chassiakos
(Associate Professor, Department of Civil Engineering University of Patras, Greece)

Abstract
The increasing number and complexity of engineering projects require the
implementation of systematic management procedures for effective project
execution. Among existing project management standards, PMBOK and PRINCE2
have prevailed. PRINCE2 appears more suitable for disciplined environments with
strong leadership while PMBOK may be more appropriate for organisations not
emphasizing on a strong hierarchy. Such standards can be effective in large or well
structured organisations but not so effective in organisations without experience,
ability or motivation to invest much in project management. A guide that may be
used to assist organisations in developing a project management method internally
is presented. The guide is structured upon a detailed questionnaire that aims to
reveal the general directions for developing a management method that meets the
organisation needs, to suggest practical implementation plans and actions, to help
organising the management documentation, and to provide incentives for further
investigation and development. The proposed guide is flexible, directly applicable,
adapted to the organisation needs, and promotes people creativity and
participation.

Keywords
Project management, Standards, PMI, PMBoK, Prince2

1. Introduction

The current need for building more, larger and of increased complexity projects is
being affected by technological advancement, globalisation, shortening of product
life cycle and increasing competition over depleting resources. An important success
factor of projects, in terms of both the quality of the deliverable and the production
time and cost, is their systematic management. In this direction, several
management methods and standards have been developed over the last decades
and used in many production lines and projects. Two of the standards that have
prevailed, based on their penetration, geographical spread and de facto or de jure
dominance, are PMBoK (Project Management Institute-PMI (2009)) and PRINCE2
(Office of Government Commerce-OGC (2009)).

The literature includes several references and case studies from around the world
about the two standards. However, it seems that there are no enough studies about
how these standards interrelate and which are the optimal conditions for their
successful deployment. Moreover, there has not been any attractive alternative for
organisations without the experience or motivation to apply such robust standards
but still willing to incorporate simple project management procedures.

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The objectives of this paper are:

 to perform a comparative evaluation of the two standards (similarities,
differences and extras) and to determine the conditions under which each
standard is more effective,
 to present a practical and flexible guide that may assist organisations without
previous experience, ability or enthusiasm to use existing standards in
developing a project management method that can better fit to the needs of the
organisation.

2. Comparative evaluation of PMBoK and PRINCE2

2.1 History, aims and structure

PMBoK has been developed by PMI (an independent non-profit organisation aiming
to enhance project management) and it is the USA official standard (ANSI) for
project management. PRINCE2 has been developed by OGC (a British Government
Office aiming to successful execution of primarily government projects) and it is the
“de facto” standard in UK and other countries. Both standards have originated in
the late 80’s and have gone through four major revisions since then apart from
various improving editions. They have both developed a project manager
certification procedure and user support system and are now worldwide established
counting more than 250,000 certified practitioners each.

Both standards provide a general framework for project management and describe
analytically a large number of management procedures, their inputs and outputs
and tools utilised. The specific procedures and the extent that they are applied in
each project are determined by the project team and/or the project executing
organisation.

PMBoK is structured following particular management knowledge areas incorporated

to it. PRINCE2 instead follows a project management phase structure. Despite
differences in their structure, both standards point out the fact that project
management is an iterative process rather than a linear one, meaning that most
management activities are executed more than once during a project. They also
both acknowledge that project management is a constitutive element of the project
life cycle trying to optimally allocate organisation resources into operational work.

2.2 Comparison of Standards

An in-depth comparative evaluation of PMBoK and PRINCE2 has been performed in

Loukas (2008). The results of the evaluation are summarised in Table 1. It can be
seen that the two standards bear more similarities than differences. Their
differences can be attributed to their historic evolution and their goals. In
particular, whereas PMBoK is supported by an independent organisation and aims
at knowledge advancement, PRINCE2 is managed by the British Government and is
mainly directed to managing governmental projects.

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PMBoK PRINCE2
Both standards are bulky (presenting a lot of procedures, their
interdependencies and tools), generic, independent of specific industry and
other standards (e.g. ISO).
They have been developed at the same time period, cover virtually the same
Similarities

needs and they are enhanced by a user certification and support system.
They coincide in principals, concept and roles although utilise somehow
different terminology.
They are generally in agreement regarding knowledge areas and procedures
necessary for successful project management.
Both standards emphasise the need for further adjustments and adaptation to
the characteristics of each specific project and project environment in order to
be effectively applied.
PMBoK PRINCE2
Structured according to the Follows generally a project
knowledge areas it covers. management phase structure.
Places the centre of authority within Places the centre of authority outside
the project team empowering thus the project team, in particular to the
the project manager. Executive, confining thus the project
manager role to a day by day
Dissimilarities

management.
Allows the project team and the Assumes strict and clear setting of roles
project manager to set roles and and responsibilities beforehand.
responsibilities.
Emphasises on encouraging Emphasises the adherence to
initiatives in order to maximise team hierarchy.
participation and commitment.
Includes extra knowledge areas, Excludes these knowledge areas
such as Human Resources and considering them of being out of scope.
Procurement Management.
Includes extra project management Excludes these tools considering them
tools (e.g. Earned Value Analysis). as being widely known.
PMBoK PRINCE2
Considers additional knowledge Provides detailed check lists for roles,
areas (e.g. Human Resources and procedures and managerial
Procurement Management) and deliverables.
Extras

tools (e.g. Earned Value Analysis,

three-point estimate).
Emphasises on the prevention of Focuses on controlling deviation.
deviation.

Table 1: Comparative evaluation of PMBoK and PRINCE2

The differences and extras can determine the standard efficacy considering the
specific needs of projects and project environments. It seems that PRINCE2 may be
somewhat more suitable for projects executed in a disciplined environment with a
strong hierarchy centre while PMBoK may better accommodate projects in
multicultural and flat environments which do not strictly adhere to hierarchy. To
maximise benefits, one may consider using elements from both standards; PMBoK
as a robust theoretical base and PRINCE2 as an effective practical guide. In all
cases, tailoring of the project management method is fundamental to its success.

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3. Proposed guide for internal PM method development

3.1 Need and objectives

The global recognition and popularity of the previous standards cannot eliminate
the need for their successful customisation (sizing and tailoring) to every specific
project and organisation. Because these standards are of a general nature, which is
highly desirable and beneficial for their independence of a specific industry, their
customisation to specific organisation or project characteristics (such as size,
complexity, environment etc) is not easily or effectively achieved. Moreover, this
customisation requires appropriate knowledge, training and experience that many
organisations may not have or are unable to achieve within existing time and
budget constraints. In addition, many organisations would prefer to develop
management methods and procedures internally in order to better adapt to their
needs. In this direction, a flexible guide that may assist organisations in developing
a project management method internally is presented. The aim of the guide is to
provide the general direction and a practical step by step approach for the project
management method development using simple and well-known tools without the
need to refer to existing standards.

3.2 Tools and structure

The guide is structured upon a detailed questionnaire that aims to assist a step by
step project management method development. There are 280 questions consisting
five chapters (development phases) which intend to reveal the general directions
for developing an internal project management method that meets the organisation
needs, to suggest practical implementation plans and actions, to help organising
the project management method documentation, and to provide incentives for
further investigation and development. The employment of a questionnaire (instead
of a list of suggestions) bears several advantages, such as:
 it assists the participants to better discover the special characteristics of the
organisation structure, the projects and the project environments,
 it allows the participants to better understand the important project
management parameters and procedures,
 it stimulates participant creativity,
 it helps in increasing participation and commitment.

Simple and extensively used tools are proposed throughout the guide in selected
points to further support the management method development:
 SWOT Analysis (Korres et al. (2003)) as an awareness tool to recognise areas
that can be utilised or strengthened.
 Cost – Βenefit Analysis (Korres and Chassiakos (2003)) as a decision making
tool for future decisions or as a post-evaluation tool of previous decisions.
 Probability Impact Matrix (PIM) (PMI, 2009) as a means to systematically
recognise, quantify and treat uncertain events, such as risks and opportunities.
 5W/H (Who, What, Where, When, Why, and How) as a way to identify and
document all the necessary information.

The guide suggests a five-step development as indicated in Table 2. The Table

briefly presents the topics (content), objectives and indicative suggestions within
each phase. Some sample questions for each phase are further presented to
provide a better view of the guide content and its expected results.

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Nr PHASE TOPICS OBJECTIVES EXAMPLES

(chapter) (sections)
1 Analysis of Collection and To better A big construction
the need for evaluation of data understand and company engaged in new
a PM method about: document the road or railway projects
 Organisation business need has different needs from
 Projects for a PM method a small company which is
 Customers (type, size, cost mainly focused on
 Suppliers benefit analysis building homes. While
 Subcontractors etc) and the the first one needs an
 Competition desirable extensive PM method,
 Environment characteristics the second one can
 Human of the PM probably speed up the
Resources method. development and
 Quality condense the method.
 Risk
Sample questions:
 What is the project impact on the financial results, the brand image and the
strategic goals of the organisation?
 What are the strengths and weaknesses (SWOT Analysis) of the organisation
personnel involved in projects?
 Are there any stakeholders that may oppose to the new method (5W/H) and
how are they going to be dealt with?
2 Development Decision making To develop a Public sector projects
of the PM about: method that require stiff approval
method  Basic meets the procedures and formal
characteristics business needs documentation, while
of the method without private sector projects
 Procedures disturbing the could be more flexible in
 Templates existing these aspects.
 Tools operation
 Documentation framework of Some organisations are
 Approvals the organisation mature enough to use
 Side effects of and to plan a demanding tools (such as
PM method pilot application Earned Value Analysis
 Pilot for prompt that calls for extensive
application evaluation of follow up) while others
planning method cannot do so and should
 Requirements effectiveness. start up with basic tools
for pilot (such as three-point
application estimate).
Sample questions:
 What will be the contents of the “Project Management Plan” for every project
and how is this going to be developed (5W/H)?
 What are the risks of the pilot application of the PM method (PIM)?
 What is the predicted cost of the pilot application (Cost – Benefit Analysis)?
3 Pilot Application and To assess the Best case scenario is to
application evaluation of PM method execute similar and
of PM method: effectiveness representative projects
method  Application of and determine with and without the new
PM method in areas of PM method so that the
selected improvement. results of the method can
projects be tracked and shown.
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 Results
evaluation
Sample questions:
 Are the technical skills and other prerequisites of a successful pilot project
implementation in place so that the results of the method can be isolated and
stay unaffected by other drawbacks?
 Are the results of the method gathered as planned and free of any subjective
judgement and/or mistake in measuring?
 Are there any side effects of the method that have not been predicted?
4 PM method Adjustments in To appropriately Every method, no matter
refinement PM method refine the PM how well designed, will
according to pilot method and fail if it is deployed
application ensure that all without all the supporting
findings: prerequisites for tools in place (e.g.
 Improvement the PM method management information
approval full application systems).
 Deployment of have been
improvements addressed.
 Check for side
effects, if any
 Preparation for
the operation
phase
Sample questions:
 What are the expected side effects and the Cost – Benefit analysis of the
proposed necessary or desired changes to the method?
 Is there a need for further testing of the method as a whole or partially after the
refinement?
 Who will be in charge of monitoring operation and support of the method
(5W/H)?
5 Operation Operational To make sure Continuous and strong
and support phase: that the method management support is a
phase  Monitor and is properly key success factor.
control of used, evaluate
method its results and Data gathering and
application propose further periodical evaluation of
 Data collection (long-term) the method are also
and periodical improvements. important.
evaluation
Sample questions:
 Is there sufficient and timely communication within the organisation about the
method application and data gathering?
 Are the projects managed according to the method, its tools and templates?
 Is there a reason for immediate action before the scheduled evaluation and/or
change of the method due to negative effects?

Table 2: Structure of the proposed guide

At the beginning of each chapter, its objectives are defined, important guidelines
(hints and tips) for a successful performance are outlined and there is a short yet
necessary business need validation section according to previous sections findings.
Finally, prerequisites to a good start and execution of the section are described. At
the chapter end, results must be analytically documented and an executive
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summary report is created and officially approved. If there are management

comments, parts of the phase can be re-done before the results are finally
approved.

3.3 Benefits and shortcomings

Although the guide has been based on existing standards, it is designed to be

applied independently from them. The proposed guide is of general application,
analytical and structured, yet simple, short and easy to use even by organisations
with no extensive knowledge or previous experience in project management
methods. Developing a project management method internally offers a number of
benefits:
 the method is adapted to the organisation needs from the beginning,
 the personnel is vitally engaged throughout the development process and,
therefore, committed to its success,
 there is limited need for external support since the method is build step by step,
 the development promotes continuity, adaptability and extensibility.

On the other hand, certain shortcomings and difficulties are associated with the
proposed method development such as:
 the initiation momentum for the method development may be low,
 existing knowledge and experience from other organisations may not be
adequately utilized,
 the progressively acquired experience may be narrowed to the executed
activities,
 the method may be accidentally or on purpose misled by the developing team
since it is not benchmarked against an existing, widely recognised framework.

4. Conclusions

The increasing number and complexity of engineering projects require the

implementation of systematic and standardized project management techniques for
effective project execution. Among existing project management standards, PMBOK
and PRINCE2 have been globally used in such direction. However, their use may be
effective only in large or well structured companies and organisations. The
objectives of this work are (a) to perform a comparative evaluation of these
standards and (b) to propose a guide that may assist organisations in developing a
project management method internally, which may be more flexible in application
and more adapted to the needs of each organisation.

The evaluation of the two standards shows that they bear more similarities than
differences. Both standards are bulky (presenting a lot of procedures, their
interdependencies and tools), generic, independent of specific industry and other
standards (e.g. ISO). They coincide in principals, concepts, roles and procedures
necessary for successful project management. They both recognize the need for
further adjustments and adaptation to the characteristics of each specific project
and project environment in order to be effectively applied. In terms of differences,
PMBok is structured according to the knowledge areas it covers, places the centre
of authority within the project team, allows the project team and the project
manager to set roles and responsibilities, and emphasises on encouraging initiatives
with the aim of maximizing team participation and commitment. On the other hand,
PRINCE2 follows generally a project management phase structure, places the
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centre of authority on the Executive, confining thus the project manager role to a
day by day management, assumes strict and clear setting of roles and
responsibilities beforehand, and emphasises the adherence to hierarchy. In
conclusion, it can be said that they both standards can be effective depending on
the environment they are applied and on the success of adaptation to it. PRINCE2
appears somewhat more suitable for more disciplined environments with a strong
leadership while PMBOK may be more appropriate for organisations not
emphasizing on a strong hierarchy. The maximum benefit may probably result from
the combination of PMBOK as a theoretical base and PRINCE2 as a practical tool.

The proposed guide considers the difficulties in application of robust standards by

organisations without experience, ability or motivation to invest much in this
direction. The guide is structured upon a detailed questionnaire that aims to assist
a step by step project management method development. There are 280 questions
consisting five chapters (development phases) which intend to reveal the general
directions for developing an internal project management method that meets the
organisation needs, to suggest practical implementation plans and actions, to help
organising the project management method documentation, and to provide
incentives for further investigation and development. The proposed guide is flexible,
directly applicable and has minimal requirements for external support. Moreover,
the fact that the organisation develops the project management method internally
results in sufficient adaptation to the needs of the organisation, wider and direct
people creativity and participation as well as extensibility potential based on
internal needs and regardless of the improvements in “commercial” standards.

5. References

Korres, G., Goutsos, St., Kostouros, I. (2003), “Management Principles” (1st

edition), Hellenic Open University, Patras, Greece (in greek).
Korres, G., Chassiakos, A. (2003), “Construction Project Financial” (1st edition),
Hellenic Open University, Patras, Greece (in greek).
Loukas, P. (2008), “Comparative evaluation of PMBoK and PRINCE2 - Proposal of a
guide for project management application in practice”, M.Sc. Thesis, School of
Science and Technology, Hellenic Open University, Patras, Greece (in greek).
Office of Government Commerce (OGC) (2009), “Managing Successful Projects with
PRINCE2” (2009 edition), TSO Publications, Norwich, UK.
Project Management Institute (PMI) (2009), “A Guide to the Project Management
Body of Knowledge” (4th edition), PMI Publications, Pennsylvania, USA.

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AA067

Construction Productivity: From measurement to improvement

Andreas N. Malisiovas
(Civil Engineer, University of Texas at Austin, Austin, TX, USA)

Abstract
The subject of productivity is one of the broadest, most complicated, and therefore
vague subjects related with constructions. Much research has been done for
creating techniques which can efficiently measure productivity, and even more
suggestions for its improvement can now be found in related literature. This paper
aims to introduce current techniques and methods for measuring construction
productivity along with their critique, and potential ways to improve their use. In
order for the present work to be completed, people with great experience from
construction industry and academia were interviewed and an extended literature
review has been conducted. The data analysis reveals some unique issues that can
lead to productivity loss, and also provide engineers with the current industry and
academia trends on improving productivity in constructions. The results of that
research can help the engineering community understand the seriousness of the
construction productivity problem, and provide engineers with techniques and
recommendations to face that problem.

Keywords
Construction Productivity, Productivity Loss, Productivity Measurement,
Improvement Techniques

1. Introduction

Construction people have to improve their productivity in order to survive in the

highly competitive environment of the industry. Hence, productivity has been
generating significant interest in both the construction industry and academia (Park
et al., 2005). Although through the years many suggestions and efforts for
measuring and improving productivity have been made (Borcherding, 2008, Liberta
et al., 2003, Oglesby et al., 1989) the advancement of that task is relatively slow
because of the various factors that affect it and the uncertainty of how to effectively
measure it with the most efficient way (CII, 2000). Moreover, the amount of
existing techniques globally used for measuring productivity is extremely extended
and there are many uncertainties around the accuracy and applicability of many
methods. Finally, not all of the proposed measurement and improvement
techniques are broadly applied to real construction projects while many are
theoretically developed and evaluated. The previously mentioned reason makes it
difficult to form an actual list of the widely used techniques, their advantages and
disadvantages and to present more suggestions on their applicability or usage for
productivity improvement. The purpose of this report is to present a summary of
the most widely used productivity measurement techniques and productivity
improvement methods. In addition an effort is made to explore the limitations and
uncertainties on those methods, and also make some suggestions about
productivity improvement.

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2. Background

According to various researchers, no universally accepted productivity

measurement standard exists (CII, 2000, Park et al., 2005), something which is
considered to be the main reason for the existence of so many measurement
methods. The amount of existing techniques used for measuring productivity
extends from time-lapse photography and video analysis in combination with
statistics (Oglesby et al., 1989), to models using historical data (Song and
AbouRizk, 2008), Neural Networks (Chao and Skibniewski, 1994, Ezeldin and
Sharara, 2006), and techniques from other industries like manufacturing (Lean
Construction Institute, 2010, Alarcon et al., 2003). Related literature reveals that
some of the techniques used are designed to measure the productivity of specific
crafts at different kinds of construction work (Song et al., 2003), while others
measure productivity at firm or site level and include every participant involved in
construction (Alarcon and Calderon, 2003). Additionally, construction productivity is
affected by many factors which when not handled properly can cause great
productivity loss. According to the related literature construction productivity loss is
mostly related with situations like worker low motivation and dissatisfaction, poor
worker skills, insufficient equipment and tools, excessive overtime and material
handling, rework and worker fatigue, inadequate planning, poor construction
management, and many more (Borcherding et al., 1972, Borcherding and Garner,
1981, Fosberg and Saukkoriipi 2007, Ofori 2005). In order to maintain adequate
productivity standards, construction firms should track the main causes of
productivity loss and work towards a method for controlling them for improving
construction productivity and performance (Borcherding, 2008). Except from the
traditional productivity improvement techniques construction productivity can be
boosted with the use of information technology advancements which enable project
participants to collect and share important field data in a timely and accurate
manner (Chao and Skibniewski, 1994, LeMenager, 1992, Hewage and Ruwanpura,
2009). Examples of such technology applications are mobile computing, 3D Laser
Scanning, digital close-range photogrametry, GPS, sensors, and wireless
communication (Eldin and Egger, 1990, LeMenager, 1992, Song et al., 2004).
Moreover, many researchers (Alarcon and Calderon, 2003, Forsberg and
Saukkoriipi, 2007, Salem et al., 2006) are trying to utilize methods from other
industries to improve productivity. Lean construction seems to be the most popular
of that kind of methods. Despite the fact that many lean construction tools and
elements are still in an embryonic state, lean construction techniques (Last Planner,
Six Sigma) are gaining popularity because they can affect the bottom line of
projects.

3. Methodology

For completing that report, the first step of the method followed was that of an
extensive bibliographic research, and after establishing a solid background of the
academic efforts on construction productivity measurement and improvement a
series of interviews followed to explore the existing construction industry trends.
More than 50 experienced engineers working from small to multinational level
construction firms, experienced project managers, construction directors, and
faculty of academic and research institutes were interviewed. Most of them are
employed in the US, and European construction industries, while others are
appointed as University faculty members at construction engineering departments.

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The participants were asked questions about how do they perceive productivity
terms, the importance of productivity knowledge, the ways and frequency of
measuring construction productivity, critique of the measurement techniques they
use, the causes of low productivity and the ways to improve it. Because of the
complexity and vagueness of the subject of productivity the data collection method
preferred was of personal interviews with open ended questions, instead of asking
the survey participants to complete a questionnaire. It was considered to be more
practical, and ethical to leave the participants free to express their views and not to
direct their options (and consequently the results) by asking for answers at multiple
choice questionnaires. Respondents were mostly conducted physically by telephone
and face-to-face interviews, with a very small number of people (less than 10%)
being interviewed through e-mails. Because of the absence of numeric data in the
responses, the basic theory of statistics was used for output data analysis. After the
interviews concluded, various responses were counted and the most acceptable and
broadly used measurement techniques were selected and analyzed. Furthermore,
recommendations for improving construction productivity starting from its
measuring were introduced along with the analysis of issues that can cause
productivity loss and a discussion on recommendations for facing that problem.

4. Construction productivity measurement techniques

The methods and techniques presented are, according to the interviews, the most
widely used in an effort to measure, and evaluate productivity in a construction site
or at the firm level. Some of those methods are experience-based while others are
applied with the use of mathematical and statistical models, technological tools,
and computer-based applications. By recording industry trends in measuring
construction productivity it was observed that the majority of independent
engineering companies, and smaller construction firms tend to use experience-
based models for conducting measurements, or they do not even track productivity
at all, while large firms, companies and construction organizations (mostly in the
US) tend to measure productivity by using more complex, computer-based models
and work sampling with the help of technology tools. Moreover, for the same
activity, productivity may be measured by different people in different ways, and so
the resulting productivity values may not be directly comparable.

4.1 Input/ Output

Input/output ratio (for example work hours per square feet of wall painted), is
mostly used for measuring productivity at an activity level (labor productivity), and
its lower values indicate better labor productivity-performance. Furthermore, when
measured by that method labor productivity often depicts how efficiently labor is
combined with other factors of production, a clue which can be very useful for
activity planning and scheduling. Therefore, if productivity is reported as work
hours per unit, the cost engineer can easily determine project costs by multiplying
productivity times the estimated quantity and the wage rate. The present form of
measurement has the disadvantage of being very simplistic, and it cannot depict
the real on-site situation by not taking into account any of the factors affecting site
activities. That model could be helpful for having an estimation of labor
productivity, but the same could not be claimed for the productivity of
organizational and off-site staff, management staff (whose works’ input and output
cannot easily be defined), nor for productivity at a firm level.

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4.2 Experience-based models

Probably the first attempts to measure and understand productivity in the

construction industry were totally based on the experience of engineers and
constructors in general. In the times where advanced technology and measurement
techniques were not available, the actual productivity in a construction site was
perceived and evaluated by experience-based estimations based on daily
observations on the job site. Despite the industry’s technological advancement and
the numerous measuring techniques now existing, surveys revealed that more than
20% of contractors still rely on estimators’ experience and notions for the majority
of their estimates. Obviously, the accuracy and reliability of this approach are
influenced by personal prejudice and can be highly subjective. When using models
and techniques highly related on experience, the most reliable estimate can be
made by combining that experience with past project data. However, such empirical
practices do not guarantee a consistent estimate due to the lack of an efficient
binding mechanism that could relate the present case to past patterns.

4.3 Measuring productivity using project milestones

Another broadly used method is measuring productivity by using project

milestones. At the beginning of a project, construction managers and other
administrative personnel of a project’s general contractor, define some project
milestones, which need to be completed by specific deadlines. By the end of a pre-
defined time spam (one or two weeks), staff meetings are held in order to review
the work progress and discuss about the completion percentage of the milestones.
During those meetings, an evaluation of the general work progress plan takes place
and the productivity of the whole project is defined by examining the completion
percentages of project tasks usually with the help of a project planning software.
Despite being easy to follow, the milestone method does not provide any outcomes
that could help defining the root of a possible productivity loss. Furthermore, it is
not useful for defining on-site productivity and it does not give any numerical
results which could enable construction managers to compare each week’s
productivity with previously recorded data. It can be claimed that this method is
more a broadly used, experience-based technique than a broadly accepted scientific
method which can generate safe and accurate outcomes.

4.4 Activity model (Work sampling)

A number of labor productivity models based on work-study concepts have been

proposed during years of research and applications. Those models can be arranged
in three broad classifications: delay, activity, and task models. According to the
conducted interviews activity models were considered the most accepted and widely
used work-study models. Activity models are based on work sampling, a method
that employs statistical sampling theory to measure the utilization of labor,
measured in time. Work sampling is based on probability theory. The ratio of the
number of observations of a given activity to the total number of observations of all
activities approximates the percentage of time that the work process spends on
that activity. If the number of random observations from a large group of craft
activities on a project is large enough, the percentage of time found by work
sampling spent on an activity will differ little from the actual time spent on that
activity in the work process developed on the project site. The needed data can be
collected with ways varying from observation tours, to the use of video-recording,
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time lapse photography, and others. It is important that sampling is conducted

randomly, and without bias by trained construction or maintenance analysts.
Covering the entire labor workforce on-site, each worker is counted as one
sampling observation. Usually, most data is recorded in three categories: Direct
work, support work, and delays. Work sampling provides the researcher with ratio
estimates (waiting/total) which are a very convenient way to measure productivity.
Furthermore, the method is easy to administer and fairly cheap and in the same
time collects useful facts during project execution that are not normally collected by
other methods, while it has no, or minimal, interference with the worker’s normal
activities. On the other hand, some major disadvantages are the human errors that
may occur, and the possible limited accuracy of results. Furthermore, work
sampling does not differentiate rework from original work and is frequently
reviewed with great suspicion by craftsmen and foremen.

4.5 Factor models

Factor models are multi-variant approaches to modeling the productivity of a crew

rather than of an individual, based on the factors that affect it. The quantification of
factors involves the statistical analysis of crew productivity and related factors
(Thomas and Yiakoumis, 1987). Their applicability and accuracy makes them
valuable tools for measuring and predicting productivity at site level. The many
factor models now existing have implemented many mathematical and statistical
methods and software in order to generate more accurate results and
simultaneously take under consideration many factors. On the other hand, and
according to the conducted literature review and interviews, the key limitation of
those models is that despite their applicability for measuring the site-level
productivity of a specific project, they do not address interactions across multiple
projects and hence it is difficult to be applied at a firm level.

4.6 Cost reporting method

Many construction companies, which do not use any statistical or mathematical

techniques and software, try to make estimations about their productivity rates by
monitoring and comparing project costs. The method they follow for productivity
estimation is usually based on the simplistic approach that when the cost is
increased, work is unproductive. In order to have the ability to compare costs of
similar projects, a database containing historical data of costs for materials, wages,
and others is needed. Such data can be collected from previous projects and are
used not only for measuring productivity of a specific project but also for predicting
future productivity trends. This kind of method has the advantage of being very
simple and easy to use. On the other hand, it does not pinpoint the root of possible
low productivity, and data collection may become a costly and time consuming
procedure, with high possibilities for human errors in estimating input and output,
when compared to other available techniques for measuring productivity.

5. Productivity loss and trends on improvement

Construction industry experts tend to relate construction productivity loss mostly

with on-site activities and situations like worker low motivation and dissatisfaction,
poor worker skills, insufficient equipment, excessive overtime and material
handling, rework and worker fatigue. In addition, more than seventy five per cent
of the people interviewed seemed to be highly aware of the importance of
administrative, and support staff skills, indicating as very important factors for
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productivity loss the low planning level, the poor pre-planning, the lack of
leadership and skills in management team, and the poor on-site management. As
for improving construction productivity, interviews have shown that the majority of
the industry professionals (more than eight out of ten) continue to show some
preference on traditional productivity improvement techniques like craft
productivity measurements and motivation enhancement programs, extensive
project pre-planning, cost control, and the selection of better equipment.
Furthermore, a very popular notion among engineering professionals is productivity
improvement through advanced technology use. Many construction firms try to
promote the use of hardware technologies, such as optical scanning, optical mark
recognition, bar coding, video and camcorders which with the help of software can
analyze the data collected and give recommendations for productivity
improvement.

6. Discussion

It is quite obvious that not every measurement method can efficiently be applied to
any project’s situation, and that the use of each method/technique has advantages
and disadvantages. The use of an unsuitable measurement method may not only
cause productivity loss, but also falsely indicate such a situation. For the above
reasons, and in order to improve the use of measurement techniques, construction
managers first need to carefully evaluate the available methods and find the most
applicable to their project and needs. Furthermore, people handling the selected
measurement tool should be well trained, have knowledge of measurement
analysis, vision to relate measurements with the on-site reality, and decisiveness to
take actions towards productivity improvements. For improving the broadly used
methods the industry should probably rely more on those that give numerical data
for productivity, not only because those methods are outcomes of scientific
research, but also because they help firms keep a history record of productivity
data.

Moreover, as the literature review revealed, numerous productivity measurement

methods exist. Some are still on experimental level while others have been used for
several years. In addition, method selection is frequently based on the size and
economic power of the construction firm. Consequently, small firms which depend
on individuals with low budgets, tend to use methods based on personal experience
and not on proved scientific research. Those experience-based techniques may
prove to be very efficient, but they have the disadvantage that their efficiency
cannot be easily measured, and the firm’s productivity trends cannot be easily
recorded because of the absence of productivity numerical values.

As for the industry trends in improving construction productivity the literature

review has shown that the industry tends to move forward by following the
advancement of technology. Most of the new methods proposed are based on the
use of IT, computer-based systems and software. The question is if small
construction firms struggling to survive through today’s world economic crisis can
afford the use of such applications. The trend of such firms is not to generally
measure productivity by using any particular technique, but to have an overview of
it through the use of a cost reporting method. That trend in combination with the
unwillingness of small firms to make investments in new tools make productivity
measurement and improvement a very challenging task for the majority of the
industry members. In order to face that challenge, construction community needs
to motivate individuals to measure and improve productivity of their firms and
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companies, and also motivate researchers to create inexpensive and easy to

operate scientific tools, as for everyone to have the ability to effectively measure
construction productivity.

7. Conclusions

Construction is a constantly evolving industry, heavily affected by the rapid

evolution of technology which makes situations change dramatically from one day
to the other. People involved in constructions have diverse opinions on the subject
of productivity measurement, mostly because the term “productivity” is not easily
defined and understood. Furthermore, causes of productivity loss are not always
predictable and easy to track. It usually requires much effort to define those causes
and much more effort to adequately face them. Research also showed that there is
a difference in the way of productivity measurement between large and small-
independent firms which do not frequently measure or record productivity of their
projects, and thus have difficulties in improving performance. Moreover, the
majority of techniques/ tools used for measuring productivity have key limitations,
something that should alert industry participants before deciding the selection of a
specific tool. In addition, technology use as a measure for boosting productivity is
usually a privilege of firms with great economical power, a situation that needs to
be faced with much attention.

In order to expand the conducted research, further interviews on a larger scale and
with diverse background participants should be conducted. Some of those
participants should be key people working for developers and manufacturers of
software and hardware used for productivity measurement and analysis, mostly
because they can reveal the conceptual background behind the development of a
measurement tool and the industry’s needs and wills for such tools. Further
research and mostly more interviews and surveys must be conducted in order to
create a complete catalogue of measurement techniques used, and the ways to
improve them. Finally, the correlation between recorder productivity loss and the
technique/tool used to define that loss should be re-examined, and with the help of
industry experts and researchers shape the path leading from productivity
measurement to productivity improvement.

8. References

Alarcon, L. F. and Calderon, R. (2003), “Implementing Lean Production Strategies

in Construction Companies” in: Molenaar, K.R. and Chinowsky, P.S. (ed.),
Proceedings of the 2003 Construction Research Congress, ASCE, Honolulu.
Borcherding, J. D. (1972), “An Exploratory Study of Attitudes that Affect Human
Resources in Building and Industrial Construction”, Technical Report,
Department of Civil Engineering, Stanford University, Stanford California.
Borcherding, J. D. (2008), “Construction Productivity”, Course Package, School of
Civil, Architectural, and Environmental Engineering, the University of Texas at
Austin, Austin, TX.
Borcherding, J. D. and Garner, D.F. (1981), “Work force motivation and
productivity on large jobs”, ASCE Journal of the Construction Division, 107(3),
443–453.
Chao, L. C. and Skibniewski, M. J. (1994), “Estimating Construction Productivity:
Neural-Network-Based Approach”, Journal of Computing in Civil Engineering,
8(2), 234-251.
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CII, (2000), “Quantifying the Cumulative Impact of Change Orders for Electrical
and Mechanical Contractors”, Technical Report, RS158-1 Construction Industry
Institute, Austin, TX.
Eldin, N. N. and Egger, S. (1990), “Productivity Improvement Tool: Camcorders”,
Journal of Construction Engineering and Management, 116(1), 100-111.
Ezeldin, S. A. and Sharara, L. (2006), “Neural Networks for Estimating the
Productivity of Concreting Activities”, Journal of Construction Engineering and
Management, 132(6), 650-656.
Forsberg, A. and Saukkoriipi, L. (2007), “Measurement of Waste and Productivity in
Relation to Lean Thinking”, in: Pasquire, C. L. and Tzortzopoulos, P. (ed.),
Proceedings of 15th Annual Conference of the International Group for Lean
Construction, East Lansing, Michigan, 67-77.
Dai, J. Goodrum, P. M. and Maloney, W. F. (2007), “Analysis of craft workers’ and
foremen’s perceptions of the factors affecting construction labour productivity”,
Construction Management and Economics, 25, 1139–1152.
Hewage, K. N. and Ruwanpura, Y. J. (2009), “A novel solution for construction on-
site communication – the information booth”, Canadian Journal of Civil
Engineering, 36(4), 659–671.
Lean Construction Institute (2010), “Seminars”, www.leanconstruction.org,
(Accessed, 11/02/2010).
LeMenager, P. A. (1992), “Technology is Here-Are You Ready?”, Journal of
Management in Engineering, 8(3), 261-266.
LePatner, B. B. (2005), “Strategies Increase Construction Productivity”, Real Estate
Weekly, July 27, 2005.
Liberta, M., Ruwanpura, J. and Jergeas, G. (2003), “Construction Productivity
Improvement: A Study of Human, Management and External Issues”, in:
Molenaar, K.R. and Chinowsky, P.S. (ed.), Proceedings of the 2003 Construction
Research Congress, ASCE, Honolulu.
Ofori, G. (2005), “Productivity of the Construction Industry in Singapore”, Research
report, Department of Building, School of Design and Environment, National
University of Singapore.
Oglesby, C. H., Parker, H. W. and Howell, G. A. (1989), “Productivity Improvement
in Construction”, McGraw-Hill Book Co., New York, NY.
Park, H. S., Thomas, S. R., and Tucker, R. L. (2005), “Benchmarking of
Construction Productivity”, Journal of Construction Engineering and
Management, 131(7), 772-778.
Salem O., Solomon J., Genaidy A., and Minkarah, I. (2006), “Lean Construction:
From Theory to Implementation”, Journal of Management in Engineering, 22,
168-175.
Song, L., Allouche M. and AbouRizk, S. (2003), “Measuring and Estimating Steel
Drafting Productivity”, in: Molenaar, K.R. and Chinowsky, P.S. (ed.),
Proceedings of the 2003 Construction Research Congress, ASCE, Honolulu.
Song, L. and AbouRizk, S. M. (2008), “Measuring and Modeling Labor Productivity
Using Historical Data”, Journal of Construction Engineering and Management,
134(10), 786-794.
Thomas, H. R. and Yiakoumis, I. (1987), “Factor Model of Construction
Productivity”, Journal of Construction Engineering and Management, 113(4),
623-639.

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W05
Student Difficulties in Conducting PhD Level Research
The Aristotle University of Thessaloniki Case Study

Andreas N. Malisiovas
(Professional Engineer, Department of Civil Eng., AUTH, Thessaloniki, Greece)

Abstract
The Greek academic community seems to be well informed about the problems
surrounding undergraduate level studies but the unique situation of graduate
programs still remains quite unknown. This paper aims to make the first step
towards a valuable discussion about the unique situation of the Greek University
PhD programs, and explore the quality, feasibility and general philosophy which
surrounds research at the PhD level. In order to extract conclusions about the
research situation in Greece, a statistical survey was conducted among doctoral
students of the Aristotle University of Thessaloniki. Students were asked to express
their views on the research difficulties they face, by answering multiple choice
questions and also by making text comments. The data analysis reveals some
unique problems in conducting doctoral research, and also illustrates the need to
transform the current PhD research philosophy into an educational method more
applicable to the current academic needs of Greek Universities.

Keywords
PhD research, Graduate Students, Research Problems, PhD difficulties, Statistical
Survey

1. Introduction

There are many, and complex interests and motivations an individual can have for
undertaking a PhD (Barnacle and Usher, 2003, Leonard et al., 2004), and even
more possible problems that can arise during this process. The academic
community seems to be well informed about the difficulties surrounding doctoral
studies. Many researchers have explored the challenges of conducting PhD level
research along with the relevant views of students and faculty members
(supervisors) (Welsh, 1980, Russell, 1996, Golde and Gallagher, 1999). In addition,
many members of the academia have proposed solutions to problems of doctoral
research, and recommendations to make doctoral studies an easier procedure for
faculty and future candidates (Salmon, 1992, Donald et al., 1995, Phillips and
Pugh, 2000, Boud at al., 2006). Despite the above mentioned novel efforts,
knowledge about the actual PhD process is still considered to be limited. The
uniqueness of each academic institute and the constantly evolving global economic
conditions, along with the different personality of each one involved in doctoral
studies, differentiate the PhD process for each individual. For the above reasons,
the academic community should be well aware of the problems people can have in
conducting doctoral research as well as of the problems of each different academic
system in order to make generalizations which will lead to the re-evaluation and
improvement of the PhD process. The purpose of this article is to reveal and
demonstrate problems PhD students, of Greek Universities, have when conducting
research by focusing on the case of the Aristotle University of Thessaloniki (AUTH),
the largest academic unit of Greece with more than 60000 enrolled students.
Furthermore, there was made an effort to indicate the major concerns and

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obstacles doctoral students have, and to depict the situation under which research
at AUTH is conducted.

2. PhD Research in Greece

According to the Greek Scientific Association of Doctoral Candidates and the Greek
Ministry of National Education there are more than 18,000 PhD students enrolled in
the graduate programs of public Universities, a fact that reveals the intense interest
Greek students show at doctoral studies. Despite that fact, most of the PhD level
research programs in Greece lack sufficient funding and consequently doctoral
students cannot be employed by Universities as researchers while working on their
doctoral degree. In every department only a few funded research programs exist,
rarely connected with PhD research projects. For the above reasons most of the
Greek doctoral students have to personally fund their studies or find someone to
provide them with the money needed to cover their living expenses. According to
the National Statistical Service of Greece, only 225 scholarships (of 470
Euro/month) are provided each year by the State Scholarships Foundation, and 60
more are provided by other Foundations, Institutions and individuals. Most of those
scholarships are not capable of covering the living expenses of graduate students.
On the other hand, Greek graduate studies are free for the enrolled students and
do not require any tuition or fee payments. Furthermore, statistics of the National
Statistical Service of Greece reveal that more than 33% of the currently enrolled
PhD students are older than thirty three years old, something that shows great
delays on the degree completion and consequently leads many candidates to drop
their degrees. The main reason for those delays is probably the fact that most of
the PhD students have to work during they studies because the Universities’
incapability of offering adequate funding to support them.

3. Method

To collect the needed data for exploring the student difficulties in conducting PhD
level research, a survey was conducted during the academic year 2009-2010. The
participants were more than 60 active PhD students (out of the almost 110 asked
to participate, with a response rate of 57%) studying at various departments of
AUTH. The method of survey with multiple-choice questions was considered to be
the most appropriate to use, mostly because it provides the surveyors with
accurate data along with a relatively easy circulation of the questionnaires which
can be achieved among many participants and with many ways. Questionnaires
were given to survey participants personally, by mass e-mails to PhD student
organizations of various AUTH schools, and by phone interviews. The survey asked
for multiple-choice answers to questions, but also permitted many text comments
in order to help the individuals describe their unique situation without being
confined by standardized answers. Students were asked to express their views
about methodological, ethical, organizational, educational and other research issues
and demonstrate the major difficulties they face during their studies and research.
They were asked to characterize the situations-difficulties they face while studying
at AUTH by using relative terms (e.g. “excellent”, “good”, “adequate”, “fair”, “bad”
and others) and also asked open ended questions on subjects where a more
detailed opinion was considered to be more helpful. After data collection, the survey
findings were analyzed with the use of the basic theory of statistics, in order to
have a clearer picture about PhD research in Greece from the scope of
students/researchers. The major findings of the conducted research are presented
below followed by a discussion on their analysis.
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As for the demographics of the survey, most of the survey participants were
between twenty four and twenty eight years old (47%), followed by students with
ages between twenty nine and thirty two (28%), and students older than thirty two
years old (25%). The schools and departments where they were doing their
research were mostly technical (engineering) and science ones. Furthermore, their
research experience at a PhD level was less than two and a half years at a
percentage of almost 60%, between two and a half and five years at a percentage
of 27%, while almost 13% of the participants have more than five years
experience. Around 65% of the survey participants has up to two years of work
experience at a job related to their research subject, while more that 59% had
obtained a Masters degree before been enrolled at the PhD program. Furthermore
one out of four students participating in the survey had an educational experience
in a country other than Greece. The funding sources of the people questioned vary,
with more than six out of ten having as their main funding source a non-university
job, while the 34% of the participants are funded by parent and family funds, 8%
by a scholarship and 9% by University funds. In addition, the 62% of the
participants work in the private sector together with their PhD research. Finally,
66% of the people questioned feel that a PhD degree is a substantial, and probably
the most important, step towards the career they would like to follow.

4. Presentation of the major survey findings

4.1 The funding problem

The major problem indicated by almost every survey participant is insufficient

research funding. According to the survey, research and academic programs do not
receive adequate governmental funding, something that results to part-time PhD
studies for most of the students, because of their need to cover living expenses.
This is illustrated by the fact that more than 65% of the participants responded that
they are supported by their family, working at the private factor full-time, or they
are having evening part-time jobs together with their doctoral research
commitments, and only 16% of them is studying on a scholarship or is employed by
the University as a Research Assistant (Fig. 1).

Scholarshi University 
p funds
8% 9%
Family 
Part‐time  funds
job 34%
13%
Full‐time 
job
36%

Fig 1: Funding sources of AUTH PhD students

Furthermore, survey answers indicate that very little funding is provided by AUTH
to PhD students for covering other research needs like book and educational
material purchasing, conference registration fees and subscriptions to scientific
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organizations. Almost six out of ten respondents claim that they “frequently” use
personal funds to cover the above mentioned expenses which are usually very high.

4.2 Facilities and infrastructure

Another important difficulty, according to the survey participants, is the one caused
by University facilities, student offices, laboratories, and available equipment. Many
students indicated the problem of the unavailability of a designated space for
doctoral students (student offices) in many AUTH departments. From the people
surveyed, only one out of four indicated that research facilities, labs and equipment
are “adequate”, with the rest 75% considering facilities and infrastructure as
“average” or “poor”. Furthermore, despite the fact that more than eight out of ten
have no problems with finding the bibliography needed for their research, only one
out of two is satisfied with the bibliographic updating of the AUTH library system.
Finally, and in the question “Do you believe that AUTH provides its PhD students all
the required “tools” to complete their research” a percentage close to 80% replied
in negative manner.

4.3 Research Supervision

On the research and thesis supervision issue, 65% of the answers indicate that the
main supervisor of a PhD research (and thesis) can easily be found, but on the
other hand more than seven out of ten respondents state that they have important
difficulties on defining the main subject of their doctoral research. Many AUTH
students believe that their supervisors-advisors do not provide them with the
needed mentoring and guidance. In addition, one out of five people surveyed
indicated personal problems with their supervisor, and almost 45% said that they
have problems with the supervisor’s availability for meetings. Finally, almost half of
the respondents replied that except from their main supervisor their research
progress gains little attention from the rest of their supervising committee, with
23% saying that the rest of their committee is generally not available, and 18%
claiming that they have no relationships at all with them. A summary of the main
supervising problem sources is illustrated at the Figure 2 below.

In the questions regarding AUTH faculty training and scientific qualifications more
than seven out of ten participants answered that the quality of faculty is “high” or
“excellent”. Another interesting survey finding is that almost 67% of those
considering the faculty’s scientific qualifications as “average” had some educational
or research experience at a country other than Greece, and 30% have personal
problems with their supervisor. Moreover, almost 90% of those considering the
faculty’s scientific qualifications as “average” have problems (or no relationships at
all) with their supervising committee.

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35
30
25
20
15
10
5
0

Fig 2: Sources of supervising problems

4.4 Motivation

Furthermore, motivational issues are considered to cause great upsets and

difficulties while conducting PhD level research. Almost 34% of the people
questioned feel less motivated from the time when they started doing their
research, while the motivation of four out of ten surveyed has “remained stable”.

N/A
10%
Reduced
34%
Remained 
stable
40%

Increased
16%

Fig 3: Advancement of motivation for PhD research

Finally, it is indicated that from the students who have personal or cooperation
problems with their supervisors almost 67% have lost their motivation for research.

5. Discussion on the research findings

By analyzing the survey findings, conclusions could be drawn about the difficulties
PhD students in AUTH have and recommendations could be made in order to refine
graduate work at a doctoral level. As it was previously indicated, the major problem
illustrated by doctoral students was that of research funding and the fact that very
few students are getting any economic boost from the University. More than half of
the participants working together with their research stated that their motivation,
time and courage to conduct research have been diminished because of the
psychological pressure, fatigue and lack of time cased by the conflict of their
research and work duties. The majority of students who participate in research
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programs funded by the University, the Greek Government, the European Union
Research Committee or other private institutions and organizations are receiving
some kind of salary from the programs’ funds, but most of the times the subject of
that research program has nothing to do with the subject of the students’ PhD
thesis. The above can create time-management problems to doctoral students who
have to balance their everyday workload between the research program and their
own individual research. Consequently, it is easily understandable that lack of
funding can seriously affect some students’ research, and result in serious concerns
and their deep frustration (Holdaway et al., 1995).

The ideal situation for PhD students could be that of a regular University pay-roll by
being appointed as research assistants and teaching assistants or by receiving more
scholarships for conducting research. Furthermore, students should be relieved
from scientific expenses like subscriptions to scientific organizations and
federations, conference participation, the purchasing of research-related books and
others. It is sad to consider those costly actions needed at times when the world
economic crisis has caused so many difficulties in the economy of the European
Union and particularly in Greece. Despite the above, education is considered to be
one of the stepping stones of our society and ways to economically support it
should always be found. It is obvious that much work towards the direction of the
University research economic boosting should be done, and further measures
should be taken in order to overcome the funding difficulties which PhD research at
AUTH faces.

Furthermore, facilities and infrastructure of the Aristotle University are considered

by its students to be “poor” or “average” at a percentage of almost 75%. In
addition, it was stated that the number of laboratories, and facilities designated for
experimental research is quite limited when compared to the number of researchers
who have to use them. Consequently, laboratories are not always available
something which defers PhD research projects and University progress in general.
Moreover, one out of two students participated in the research were not satisfied
with the bibliographical updating of the University’s library system. According to the
participants’ statements, most of the departmental libraries do not have adequate
collections of scientific books and journals. In addition to the above mentioned
facility problems, many PhD students indicated a problem of space in their
department facilities, with more than the one third of the people questioned state
that there is no space for PhD student offices. The above mentioned issues are
probably the main reasons why the 80% of the participants think that AUTH does
not provide them with all the needed “tools” for successfully completing their
research. There are few actions that can be done for facing the infrastructure and
facility difficulties PhD students have indicated. It is true that buildings and facilities
of the AUTH campus have problems and can be rebuild, laboratories can be
expanded and modernized, and collaborations with other institutes can be formed.
All the above need an extensive amount of time, and more important much funds
to be spent from the Greek Government, funds which are difficult to be found.

Starting a research degree marks a transition in the lives of students (Phillips and
Pugh, 2000), and in order for this transition to be successful, a good morale and
strong motivation are demanded. From the doctoral students questioned, almost
34% stated that they face motivational problems. Additionally, the fact that the
67% of the students having “low” or “stable” motivation also have problems with
their supervisors illustrates how important supervising is for completing a
successful doctoral research. It is also a fact that many AUTH doctoral students can
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be considered to be on a part-time status and as other researches state: “Part-time

doctoral students have a range of support needs and these are often complex and
interwoven with their ‘other’ roles beyond that of student” (Watts, 2008). For the
above reasons, it is a very intense need to effectively face supervising problems
and also improve student mentoring and advising, in order to always keep doctoral
students motivated. It is probably a fact that most students undertake a doctorate
as an education rather as a training (Leonard et al., 2004), and for covering their
needs, and in the same time promoting the educational function of research it is
important for supervisors to expand their repertoire of skills as educators and
leaders (Pearson and Brew, 2000).

6. Conclusions

Education and research are two extremely important aspects of modern society.
Though, world economic problems and unique difficulties of each institution have
created difficulties mostly in conducting academic and PhD level research. The
difficulties doctoral students face in Greek Universities vary, and can be unique for
each individual, but it can be claimed that the problems this research revealed are
a reality for the majority of PhD students mostly because they are caused by
organizational problems, poor funding and inadequate facilities, problems which are
a reality for the Greek academic system as a whole. In an attempt to highlight the
major findings of the conducted survey, it can be stated that insufficient funding for
PhD research, facilities and infrastructure problems, and low motivation for doctoral
research are the difficulties indicated by most participants. Furthermore, actions
should be taken for improving AUTH infrastructure, motivating University students
and faculty, and finding a way to include the majority of doctoral students in a
regular pay-roll in order to promote research in Greek Universities. In addition, due
to uniqueness of the Greek educational system, it is very difficult to use models
from other countries for improving the current conditions under which PhD research
is conducted. The most applicable solution for facing the difficulties mentioned in
this paper seems to be the initiation of a new three way dialogue between PhD
students, members of the academia, and the Greek Government. This dialogue
should have as its main subject the research in Greek Universities at a PhD,
experimental and productive level. Key improvements can be introduced and a
whole new research framework can be proposed in order to promote knowledge
and education, and improve the conditions under which PhD research in Greece is
conducted.

In order to expand the conducted survey and to have a more holistic approach of
the PhD research difficulties of doctoral candidates, a new survey which would also
examine the faculty views is proposed to be conducted. The present paper has as
its limitation that it extracted conclusions only by considering students’ options and
not taking under consideration faculty views. Thereby, the conclusions drawn were
only from students’ perspective. By conducting a survey among PhD research
supervisors and combining the results of those two different surveys, the academic
community could track different opinions which could lead to safer conclusions
about the difficulties Greek Universities face, and the actions that need to be taken
for materializing students’ and supervisors’ ideal research projects. Moreover, and
having in mind that there are more than 18,000 PhD students enrolled in Greek
Universities, the results of the present paper need to be validated by a survey
which could cover the biggest part of the doctoral student body of Greece and could
though generate safer, and more detailed results.

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Russell, A. (1996), “Postgraduate Research: Student and Supervisor Views”, The
Flinders University of South Australia.
Salmon, P. (1992), “Achieving a PhD- Ten Students’ Experience”, Staffordshire:
Trentham Books Limited.
Spear, R. H. (2000), “Supervision of research students: Responding to student
expectations”, The Australian National University, Canberra.
Watts, J. H. (2008), “Challenges of supervising part-time PhD students: towards
student centred practice”, Teaching in Higher Education, 13(3), 369-373.
Welsh, J. M. (1980), “The PhD student: process and problems”, The University of
Nottingham.

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W06

The difficulty of introducing the main subject of a PhD research

Andreas N. Malisiovas
(Professional Engineer, Department of Civil Eng., AUTH, Thessaloniki, Greece)

Abstract
It is widely accepted that the definition and selection of a PhD research project is a
very important and complex procedure. Particularly in Greece, where PhD studies
are mostly supported by private (student) funds, doctoral studies have become not
only a difficult but also a very expensive process. This paper examines the Aristotle
University of Thessaloniki case study in order to explore the difficulties a doctoral
student has to overcome for defining and organizing a PhD research project. To
extract conclusions, a survey among active doctoral students was conducted. The
generated results can help us find the roots of the problem of designing and
defining the subject of a PhD research. The data analysis provides findings which
try to answer questions about communication issues between PhD student and
supervisors, the difficulty of organizing and designing PhD research projects, and
the feasibility of making one’s ideal research come to life.

Keywords
PhD research, Subject definition, Research organizing, Communication, Survey

1. Introduction

It is common knowledge that conducting a PhD research is a difficult procedure

with many obstacles that need to be faced for concluding it. Probably the most
important of the obstacles a PhD candidate has to overcome is that of introducing
and defining the main topic of the doctoral research (Kane, 1985). That topic
definition is of such importance because it will follow the student until the
completion of the PhD degree, and also because the selected topic should be
capable of helping the student make an original contribution to the chosen field and
attain the necessary experience to continue to do so (Council of Graduate Schools,
1990, p. 1).

Except from the students’ difficulties it is also challenging for the supervising
committee to provide guidance and a well defined methodology to the candidates
for conducting their doctoral research (Hughes, 1994). Much research has been
done on that student-supervisor relationship (Phillips and Pugh, 2000), and
recommendations on managing PhD research projects have been proposed (Howard
and Sharp, 1983). In addition, many researchers support that for finding and
establishing a working relationship with a supervisor, the student has to master
knowledge and reconcile conflicting methods before placing the research in the
context of literature and originality (Golde and Gallagher, 1999, Haksever and
Manisali, 2000). The above mentioned reasons clarify that introducing a PhD
research topic is not an easy task. The present paper aims to examine the Aristotle
University of Thessaloniki (AUTH) case study in order to explore the difficulties
students enrolled at Greek Universities have for organizing a PhD research project
and for finding the needed supervision. The findings’ analysis illustrates the
difficulty of organizing a PhD research along with communication issues, difficulties
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for defining a research topic, and the feasibility of making one’s ideal research
come to life.

2. Method

To collect the needed data for exploring the difficulties of defining and organizing a
PhD research project, a survey was conducted during the academic year 2009-
2010. The participants were more than 60 active PhD students studying at various
departments of AUTH. The survey asked for multiple-choice answers to questions,
but also permitted many text comments in order to help the individuals describe
their unique situation without being confined from standardized answers. After the
collection of data, the survey findings were analyzed in order to have a clearer
picture about PhD research in Greece from the scope of students/researchers. The
major findings of the conducted research are presented below followed by a
discussion on their analysis.

3. Demographics of research

Most of the PhD students who participated at the survey were between twenty four
and twenty eight years old (47%), followed by students with ages between twenty
nine and thirty two (28%), and students older than thirty two years old (25%). The
schools and departments where they were doing their research were mostly
technical (engineering) and science ones. Moreover, their research experience at a
PhD level was less than two and a half years at a percentage of almost 60%,
between two and a half and five years at a percentage of 27% and almost 13% of
more than five year experience at doctoral research. As for their work experience, a
percentage around 65% of the survey participants has up to two years of work
experience at a job related to their research subject, while more that 59% has
obtained a Masters degree before been enrolled at the PhD program. Furthermore
one out of four students participating in the survey had an educational experience
(Masters or Bachelor degree) in a country other than Greece before starting their
doctoral research. The funding sources of the people questioned vary, with more
than six out of ten having as their main funding source a non-university job, while
the 34% of the participants are funded by parent and family funds, 8% by a
scholarship and 9% by University funds. In addition, the 62% of the participants
work in the private sector together with their PhD research. Finally, 66% of the
people questioned feel that a PhD degree is a substantial, and probably the most
important, step towards the career they would like to follow.

4. Survey findings

4.1 Subject initiation difficulties

Survey participants indicated that defining the main subject of their PhD research is
one of the most important difficulties they face during their studies. Specifically,
72% of the questioned students answered that the selection of their PhD research
subject was a “difficult” or “very difficult” procedure, and indicated as the most
important of their concerns the “originality” of the selected subject. Despite the
above fact only 35% had difficulties in finding a faculty member who could act as
supervisor for their doctoral research project and thesis writing, while from the rest
who found supervisors with no particular difficulties, around 68% found it “difficult”
or “very difficult” to introduce their research subject. Furthermore, one out of three
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PhD students surveyed selected their subject after their supervisor’s urging, while
almost 60% defined their subject after having a specific research interest and in
cooperation with their supervisor. Moreover, a 22% of the PhD candidates had
difficulties in finding bibliographic references for writing their research proposal,
and almost half of the survey participants are not satisfied with the bibliographic
updating (journals, papers, books, electronic resources) of the University library
system.

4.2 The effect of students’ background

The doctoral students’ qualifications seem to play an important role in the selection
of the main PhD research subject. Nine out of ten respondents with no working
experience in an area relevant with their PhD research found “difficult” or “very
difficult” the subject selection in contrast with those who had years of working
experience and did not met such difficulties. Furthermore, more than half of the
respondents who did not have a Masters degree when enrolled at the PhD program
had difficulties in introducing the main subject of their research.

People with an interest in a specific research area had important difficulties in

defining and organizing their PhD research project. More than half of them had
problems with introducing the subject, while two out of three had also difficulties in
finding a supervisor for the research they would like to do. There were also some
doctoral students who are pursuing their PhD degree only for boosting their
curriculum in order to find better job at the private sector and not because of a
particular academic or research interest. Those people neither met any important
difficulties in finding a supervisor, nor in finding a research topic, nor in organizing
their research project.

4.3 Organizational and supervising difficulties

Finally, by answering questions about the difficulties of organizing and materializing

a PhD research project, students indicated some very important issues. The
supervisor’s unavailability for frequent meetings seems to be one of the most
important difficulties doctoral students meet. It was also stated by many students
that communication problems between them and their supervisors were making the
research project initiation an even harder process, and consequently organizational
difficulties were coming up. Additionally, almost 10% indicated that the professional
relationship between them and the research supervisor is “not satisfying” while
another 10% described that relationship as “neutral”. Almost half of the
respondents stated that they have communication problems with their supervisors,
or they could not get in contact with them when needed. Respondents with such
problems indicated their need for more step-by-step guidance from their supervisor
in order to form a methodological basis for their research. The above in
combination with the incapability of some academic departments to conduct heavy
experimental research are making the implementation of some kinds of PhD
research unfeasible, and the materialization of some students’ initial ideas
unattainable.

5. Discussion on the research findings

It was clearly illustrated at the survey findings that the initiation of a doctoral
research subject is considered (at a very high percentage) to be a very challenging
and difficult procedure, but the clear definition of a PhD research project is an
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essential prerequisite for success (Hughes, 1994). By asking them to detect the
most important difficulty in that subject definition, most of the respondents
answered the “originality” of the subject. In order for PhD students to make an
original contribution to their chosen field, a unique and original research must be
conducted, and this could be very difficult without proper supervising and guidance
which could shape and change the scientific personality of a student (Golde and
Gallagher, 1999).

Furthermore, students with difficulties finding a supervisor did not meet many
difficulties in finding a research subject in contrast with the 68% of doctoral
candidates who had problems with project initiation but not with finding a research
supervisor. The above reveals that, at least in AUTH, the effort needed to define a
doctoral research subject and the supervisor selection are two issues that are not
directly and completely related. Survey data support the notion that many PhD
students select thesis subjects which are not connected with their research
interests, just because they can be involved in a funded research project, or
because their supervisor’s interests urge them to select specific research subjects.
In addition, only a few funded research programs exist in Greek Universities’
departments and schools, programs which are rarely connected with PhD research
projects. The above can create time-management problems to doctoral students
who have to balance their everyday work-load between the supervisor’s research
program and their own individual research. For the above reasons it is very
common for Greek doctoral students to personally fund their studies or find
someone to provide them with the money needed to cover their living expenses. It
is claimed that around 90% of the Greek Universities PhD candidates are self-
funded, or funded by their family and parents. That situation is not common in
other countries like the United Kingdom, USA and Switzerland where PhD students
are funded by the Universities’ scholarships, or are under a salary from the
research programs’ funds. Consequently, doctoral students at many other countries
do not face particular problems in defining their PhD research subject because they
are not the ones who select it. By participating in a funded research or by being
funded by their supervisor’s research funds they are usually being assigned a PhD
research subject that could not be easily changed or modified, in contrast to Greek
institutions where candidates usually select their research subjects by themselves
and with some minor support from the University faculty.

Another important issue illustrated by the collected data is that of student

difficulties in finding bibliographic references for writing a research proposal. Many
PhD candidates have to submit a research proposal to their future advisors before
being officially enrolled at the PhD program. This proposal has to be accompanied
with related references and bibliography which is difficult to be found if access in
the library system and it e-resources is not granted to not officially enrolled
students. For that reason, it could be recommended that PhD students should be
asked to submit a research proposal only after they are officially admitted at the
PhD program. In a different case it is recommended that a not enrolled student
should be granted temporary access to the University’s library systems in an effort
to promote the reception of the required scientific knowledge.

The combination of students’ professional qualifications with their answers on

difficulties of subject introduction generated some very interesting findings. Survey
results reveal that professional experience works in favour of the subject selection.
Only 40% of doctoral students with professional experience had problems with
finding a subject for their thesis while that percentage rises to 90% for students
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with no such experience. Furthermore, having a Masters degree before starting PhD
research probably has the opposite results of having professional experience. It can
be noted that doctoral students with a Masters degree tend to find more difficult the
introduction of a PhD main subject compared to candidates without such a
qualification. It could be claimed that the specialization offered by a Masters degree
makes candidates narrow their research interests and options and consequently the
selection of a research supervisor or a PhD subject a more difficult procedure.
Though, the above conclusion is thought to be very risky because it is depended
upon a very small statistical sample which can often generate conflicting results.

Moreover, a contrast between students with pure research interests and those who
selected a subject only for enhancing their professional qualifications is quite
obvious. It is reported that a doctoral candidate with little research and scientific
interest is more comfortable with making recessions for finding a supervisor and
also for selecting a subject which would not probably apt directly to the initial
research idea he/she had in mind. As stated before, the PhD research subject
selection is a very important decision, having as one of its most critical aspects the
existence of a pure interest from the students-researchers for the conducting
research in order to be motivated and timely conclude with their doctoral studies.
On the other hand, it could be advocated that other motives except research
interest can urge doctoral students to effectively work on their research, with some
of those motives being professional incentives, a better salary or a qualification
which could enhance their prospects of employment or promotion, and more
(Leonard et al., 2004, and 2005). In Greece though, it is a fact that (according to
the Greek Scientific Association of Doctoral Candidates and the National Statistical
Service of Greece) professionals with a PhD degree only receive approximately 14%
higher salaries than professionals with only a Masters degree. In addition, it is very
common for PhD holders to work in sectors irrelevant with their doctoral research
subject mostly because of the Greece high percentage of unemployment, and the
existence of limited opportunities for working in research institutes and for
University appointments almost in every scientific area. It is also widely accepted
that despite the intense interest of students to pursue a PhD degree, the faculty
position openings in Greek Universities are generally very limited when compared
with other European countries, something which results in the existence of more
PhD holders than those demanded to cover the possible Greek academic system
needs.

As for the organizational difficulties a doctoral student can meet, the advisor’s
unavailability for meetings seems to be the most concerning one. That difficulty in
setting up meetings could make PhD students think that the advisor may be
indifferent, and consequently demoralize them and cause research organization
problems. Furthermore, communication difficulties along with professional
relationship problems can disrupt the harmony between students and supervisors
and cause personal disharmony which can lead to an early termination of the
supervision process (Russell, 1996, Li and Seale, 2007). PhD students can easily
lose their motivation for studying or conducting research and for that reason the
appropriate step-by-step guidance and advising is needed from the supervisors’
side.

Additionally, researchers have indicated, that one of the most serious worries of
students is the case of bad supervision (Haksever et al., 1994). For avoiding such a
case supervisors should be communicative, approachable and understanding, and
also have the experience, knowledge and familiarity with the processes of PhD
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research (Hughes, 1994). Finally, students should effectively manage their

professional learning, discuss their expectations with the supervisor, report their
difficulties, and cooperate with their supervisors on organizing, defining and
materializing their PhD research project (Hughes, 1994, Phillips and Pugh, 2000).

6. Conclusions

Introducing the main subject of a PhD research could be a very challenging and
complex procedure, and according to some doctoral students probably one of the
most complex problems they would have to solve during their student life. In order
to face such a difficulty, a strong collaboration between the candidate and the
supervisor has to be supported by effective and intense guidance, advising and
mentoring. Probable communication and professional relationship problems should
be solved before they become reasons for demoralization and thus for early
termination of research projects and collaborations. Consequently, there is a very
intense need to effectively face supervising problems and also to improve student
mentoring and advising, for always keeping doctoral students motivated.
Furthermore, and in order to minimize supervisors’ unavailability for meetings,
motivating University faculty is also needed along with an improvement of the
University’s facilities and laboratories. Moreover, the formation of affiliations with
other Universities and research institutes could be very helpful in order for the
University to be able to conduct heavy experimental research and so give PhD
candidates more options when trying to define their research subject.

In addition, students’ background may have an important role in the easiness with
which someone can define and organize a PhD research. The research has shown
that having related work experience before entering doctoral studies could help the
candidates initiate the subject of their research and also make them understand the
importance of the subject selection procedure. It is though recommended that
working experience and academic qualifications of PhD candidates should be
seriously considered for their acceptance at the University’s PhD programs.

While concluding this research paper, it has to be stated that it is probably “unfair”
for the University faculty and staff to extract conclusions by taking under
consideration only the student’s views on the subject. The opinion of academic
supervisors (which were not included in the present paper) could indicate more and
different difficulties than those indicated by the PhD students. For the above reason
and in order to have a more holistic approach of the PhD research subject
introduction difficulties, a new survey which would examine the faculty views is
proposed to be conducted. Thereby, by combining the results of two different
surveys, the academic community could track the different opinions which could
lead to safer conclusions about the difficulties Greek Universities face, and the
actions that need to be taken for materializing students’ and supervisors’ ideal
research projects.

7. References

Boud, D. and Tennant, M. (2006), “Putting doctoral education to work: Challenges

to academic practice”, Higher Education Research and Development, 25 (3),
293-306.
Brown, R. D. and Krager, L. (1985),” Ethical issues in graduate education: Faculty
and student responsibilities”, Journal of Higher Education, 56(4), 403-418.

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Council of Graduate Schools (1990), “The doctor of philosophy degree”, Report,

Washington DC: Council of Graduate Schools.
Golde, C. M. and Gallagher, H. A. (1999), “The challenges of conducting
interdisciplinary research in traditional doctoral programs”, Ecosystems, 2: 281-
285.
Haksever, A. M. and Manisali, E. (2000), “Assessing supervision requirements of
PhD students: The case of Construction Management and Engineering in the
UK”, European Journal of Engineering Education, 25(1), 19-32.
Hockey, J. (1994), “New territory: Problems of adjusting to the first year of a social
science PhD”, Studies in Higher Education, 19, 177–190.
Howard, K. and Sharp, J. A. (1983), “The management of a student research
project”, Gower Publishing Co., Ltd.
Hughes, W. (1994), “The PhD in Construction Management”, in: Skitmore, R.M. and
Betts, M. (ed.), Proccedings, of 10th Annual ARCOM Conference, Loughborough
University of Technology, 14-16 September 1994.
Leonard, D. Becker, R. and Coate, K. (2005), “To prove myself at the highest level:
The benefits of doctoral study”, Higher Education Research and Development,
24(2), 135-149.
Li, S. and Seale, C. (2007), “Managing criticism in Ph.D. supervision: a qualitative
case study”, Studies in Higher Education, 32(4), 511–526.
National Statistical Service of Greece (2010), www.statistics.gr, (Accessed,
18/02/2010).
Phillips, E. M. and Pugh, D. S. (2000), “How to get a PhD- a Handbook for students
and their supervisors”, Buckingham: Open University Press.
Russell, A. (1996), “Postgraduate Research: Student and Supervisor Views”, The
Flinders University of South Australia.
Salmon, P. (1992), “Achieving a PhD- Ten Students’ Experience”, Staffordshire:
Trentham Books Limited.
Watts, J. H. (2008), “Challenges of supervising part-time PhD students: towards
student centred practice”, Teaching in Higher Education, 13(3), 369-373.

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AA020
Assessing The Procurement Process In Greece's Construction
Projects

Odysseus Manoliadis
(Assistant Professor University of Thrace, Greece)

Konstantinos Vatalis
(Assistant Professor TEI Kozanis, Greece)

Abstract
The aim of this research is to assess the application of recent Legislation towards
sustainable procurement in Greece with special attention to the construction
industry. A questionnaire survey of twenty seven experts (construction managers,
industrial and academics) was carried out in order to investigate the awareness
level and the constraints of sustainable procurement practices, and to record the
procurement practices implemented in the Greek construction industry. The
findings indicate that although sustainability criteria are recognised as essential
their use is limited.

Keywords
Construction industry, sustainability, procurement practices, questionnaire survey

1. Introduction

Sustainability means meeting the needs of today without compromising the ability
of future generations to meet their needs (Brundtland report, 1987). Sustainable
Construction is a building methodology that promotes the attainment of goals
associated with the next “quadruple bottom line”. In achieving these goals to
improvement and enhancement of the procurement and project delivery systems
employed by private owners and government clients is considered necessary.
Recent public awareness brought in to attention laws and regulations in Greece
according to sustainability goals. Specifically, in conformance with recent laws and
regulations and in achieving the required high performance standards for
sustainable construction the procurement process is considered the key point in all
the stages of life cycle i.e. the process that spans the whole life cycle, from
identification of needs, through to the end of the useful life of an asset

The fundamental principles generally applied in the field of public procurement in

Greece, include those laid down in the EC Treaty, and relevant secondary
Community legislation (public procurement Directives). Among those are the
principles of equal treatment, non-discrimination, transparency, proportionality and
mutual recognition.
The following Community Directives on public procurement have been implemented
in the Greek legal system:
• Supplies Co-ordination Directive 93/36/EEC which is actually amended by
European Parliament and Council Directive 97/52/EC and Commission Directive
2001/78/EC
• Works Co-ordination Directive 93/37/EEC amended by European Parliament
and Council Directive 97/52/EC and Commission Directive 2001/78/EC

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• Services Directive 92/50/EEC amended by European Parliament and Council

Directive 92/57/EC and Commission Directive 2001/78/EC
• Sectoral Directive 93/38/EEC amended by Directive 98/4/EC of the European
Parliament and of the Council
• Remedies Directive 89/665/EEC and Sectoral Legal Remedies Directive
92/13/EEC
Public procurement Directives have been implemented in Greek legislation by
Presidential Decrees 370/95, 105/2000 334/2000 and 336/2002, 346/1998,
18/2000, 101/2003 and 2854/2000
In the Greek legislation there are also specific laws regulating works and design
contracts below the threshold of Council Directives 93/37/EEC and 92/50/EEC. The
main legislation in question is:
 For works: Law 1418/1984 as amended by Law 2229/1994, and Presidential
Decree 609/85
 For design contracts: Law 716/1977.
 For design contracts and relevant consulting services: Law 3164/2003
In cases of contracts below thresholds of the Directives and where there is no other
particular law provision, the framework set in the Directives is implemented in
substance..

1.1 Institutional framework

The institutional framework for public procurement in Greece consists of three

Ministries each one responsible for one sector according to the division of the
classical Directives:
• Ministry of Economy and Finance which is responsible for public procurement
of services (Directive 92/50/EEC), and Ministry of Environment, Physical Planning
and PublicWorks which is responsible especially for design studies services;
• Ministry of Development which is responsible for public procurement of
supplies (Directive 93/36/EEC);
• Ministry of Environment, Physical Planning and Public Works for public
procurement of works and construction contracts (Directive 93/37/EEC);
For the utilities sector (Directive 93/38/EEC), again the above competent Ministries
are responsible depending upon the sector of responsibility of ach Ministry.
The above mentioned Ministries co-ordinate their action for the government of
procurement policy and for the preparation of the legislative framework as well as
the incorporation of Community legislation in the Greek legal system.

1.2 Sustainable procurement

Recent awareness for the scarcity of resources in Greece has emerged the adoption
of green products and Sustainable Procurement services Sustainability as a concept
is most widely known in relation to sustainable development.
Sustainability is important for every sector of industry but merely in the
construction industry because the facilities we construct have a huge impact on the
environment. These facilities make use of natural resources during the construction
stage and leave man-made footprints in the ecological environment and they are
also our interface to the natural environment, protecting us from the elements and
meeting the needs of humanity for shelter, status, and other functions.
As a result there is a pressure in order to make these facilities more sustainable,
through sustainable construction, is the demand to meet the needs of society
without compromising the needs of others or jeopardizing the future survival of
humanity on earth.
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Sustainable construction is defined as (Chan et al 2001)‘the set of processes by

which a profitable and competitive industry delivers built assets: building
structures, supporting infrastructure and their immediate surroundings, which:
- Enhance the quality of life and offer customer satisfaction,
- Offer flexibility and the potential to cater for user changes in the future,
- Provide and support desirable natural and social environments,
- Maximize the efficient use of resources while minimizing wastage'.
Sustainable construction comprises construction procurement (i.e. new
construction, refurbishment work and maintenance), operation and demolition of
constructed work. It encircles such matters as tendering, site planning and
organization, material selection, recycling and waste minimization (Chan et al
2001)
The general framework for implementing sustainability in construction has to deal
with the procurement selection with respect to materials and services. It is claimed
that the correct choice of a construction project delivery method will lead to the
success of the project and as a result selecting an appropriate procurement system
is an essential step in any construction project process (Love et al 1998). A
construction project may be regarded as successful if it fulfils the following
requirements: it is delivered at the right time, at the appropriate price and quality
standards, and provides the client with a high level of satisfaction. The most
important influence on the above requirements is the type of procurement method
implemented which determines the overall framework and structure of
responsibilities and authorities for participants within the whole construction
process. The selection of the most suitable procurement method consequently is
critical for both clients and project participants, and is becoming an important issue
within the construction industry Watuka and Aligula (2003).

1.3 Comprehensive approaches to Sustainable Procurement at national

level

In Greece national legislation on procurement refers only to public procurement

compatible with Community law. The existing legislative framework offers
possibilities to integrate environmental considerations into public purchases,
notably when defining the technical specifications, the selection criteria and the
award criteria of a contract (e.g. Directive 93/96-14-4-1993 and Presidential
Decree 370/1995, Presidential Decree 394/1996) (Karanastasis 1998).

A questionnaire survey of twenty seven experts (construction managers, industrial

and academics) was carried out in order to investigate the awareness level and the
constraints of sustainable procurement practices, and to record the procurement
practices implemented in the Greek construction industry.

The paper is organised as follows. In the next section issues of sustainable

procurement are presented followed by the stages of the procurement process are
outlined. In the following section the methodological framework concerning the
preparation of a questionnaire survey in developing procurement selection criteria
in the case of Greek construction industry is presented. The results are presented in
the next section. The final section draws the conclusions of the paper.

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2. Background

The procurement process is viewing as a cycle (IDALG, 2003) in order to emphasise

the development of a business case. The stages of the procurement cycle are
(IDALG, 2003).
- Identifying needs
- Development of business case
- Definition of procurement approach
- Supplier selection
- Tender evaluation
- Award and implementation of contract
- Management of contract
- Closure/lessons learned
The first stage of the procurement cycle is to identify needs. Identifying needs has
to do with the alternative options for satisfying the needs of a user group which can
be significantly different from the current solution. The business case deals with the
identification and appraisal of alternative options and the establishment of value for
money. The business case can be summarised as: achieving strategic objectives;
complying with environmental law; controlling costs; managing risk and
reputation; creating markets; ensuring security of supply; ensuring maximum
community benefits. The definition of procurement approach comprises the
specification of requirements and the update of the business case. The supplier
selection has as outcome the short-list of suppliers, though tender evaluation
comprises bids evaluation, confirmation of successful supplier and updating of the
business case. The stage of award and implement contract includes the preparation
of service delivery. Management of contract deals with the serviced delivered,
benefits achieved and, value for money maintained. The final stage
(Closure/lessons learned) deals with the preparation for future arrangement and
review and updating of the business case.

2.1 Challenges for green procurement

Challenges for green procurement have emerged as a result of the international

and national The challenges for green procurement selected for consideration are
presented in Table 1 (IDALG, 2003).

2.1.1 Price

Green products are deemed to be more expensive than conventional alternatives,

which is true in some cases, particularly where development costs are reflected in
the price. However, very often there is no significant difference between green
products and conventional alternatives because a green product may have a higher
up-front purchase price, but will cost less over its lifetime.

2.1.2 Lack of corporate commitment

The implementation of a green procurement programme, requires commitment

from all levels of an organization, including senior management and purchasing
agents.

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2.1.3 Insufficient knowledge

It is essential for an organization to have an understanding of concepts and

relevant terms.

2.1.4 Availability

Delays in obtaining green products may occur because distributors do not stock
them or else they stock only small quantities of them due to low market demand.

2.1.5 No acceptable alternative

Lack of acceptable alternatives to a present product can be a barrier. construction

industry's response to sustainable construction.

2.1.6 No specifications

On one hand purchasers must clearly define their needs and requirements, though
on the other hand suppliers must be asked to provide the environmental
specifications of their products.

2.1.7 Purchasing habits

Purchasing habits have to do with change management, which is important in order
to overcome existing relationships between purchasers and suppliers that make it
difficult to switch to alternatives and change the purchasing process.

2.8 Strategy development

It is essential in order to implement a green procurement programme and aims to
identifying changes, suitable products and services, and evaluating the
environmental performance of suppliers.

3. RESEARCH METHODOLOGY

3.1 Research Design

Survey research adopted for this paper in order to obtain information on

procurement practices in Greece by asking people (i.e. persons employed in firms,
organizations/authorities) about their perceptions. The target population in survey
was 27 firms and their distribution is presented in Table1.

Type of Firm Number

Industrial 7
Educational 4
Construction 16
Total 27

Table 1. Participants

The response rate was 66 %, i.e. 18 questionnaires were returned, representing

and these were used in the analysis presented in the following section.
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3.2 Development of the questionnaire

The questionnaire refers to the challenges for green procurement that have
emerged as a result of the international and national construction industry's
response to sustainable construction. The challenges for green procurement
selected for consideration are those presented above.

Persons employed in target population (Table 1) were asked to answer the

following questions:
Question 1. Do you think that green products are more expensive than
conventional alternatives? (Yes, No)
Question 2. Do you think that the knowledge in a use of a green product is
sufficient? (Yes, No)
Question 3. Can you purchage green products easilly as for instance local
distributors or you face delays in purchaging green products Easily_ difficulties_
Question 4. Did you find lack of acceptable green product alternatives to the
present products? (Yes, No)
Question 5. Do the suppliers provide the environmental specifications of the
products they are offering? (Yes, No)
Question 6. Do you think that purchasing habits and relationships between
purchasers and suppliers that make it difficult to switch to alternative green
products? (Yes, No)
Question 7. Is it in your business goals a systematic review of the green
procurement programme to be carried out? (Yes, No)
Question 8. Where do you find more difficulties in implementing green products
procurement? Select one of the following:
1. Organizational support (Implementing a green procurement programme
means changing policies and procedures).
2. Self-evaluation: An important step in implementing green procurement is
conducting an evaluation of present purchasing practices
3. Set goals: A broad policy should be established, and specific priorities and
targets set.
4. Develop a strategy: It is now to time to identify and implement changes,
both short and long-term, identify suitable products and services, and evaluate the
environmental performance of suppliers.
5. Assignment of accountability, plan addressing employees, customers,
investors, suppliers and the public.

4. Results

All the participants think that green products are more expensive than conventional
alternatives. A percentage of 66.6% think that the knowledge in a use of a green
product is sufficient. Only 27% think that green products easily can be purchase
from local distributors while the rest 78% think that purchasing is having
difficulties. A percentage of 61% find lack of acceptable green product alternatives
to the present products all the participants say that suppliers provide the
environmental specifications of their products they are offering. A percentage of
78% think that purchasing habits and relationships between purchasers and
suppliers that make it difficult to switch to alternative green products.
Difficulties in implementing green products procurement are ranked as follows:
1. Develop a strategy
2. Set goals.
3. Organizational support
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4. Self-evaluation
5. Assignment of accountability, plan addressing employees, customers,
investors, suppliers and the public.

5. Conclusions

In order to investigate the awareness level and the constraints of sustainable

procurement practices, and record the procurement practices implemented in the
Greek construction industry a questionnaire survey of eighteen experts, mainly
consultants and contractors, was carried out in order to obtain experience of the
above issues concerning procurement practices in the Greek construction industry.
The findings indicate that although there is a sufficient knowledge in the use of
green products associated with sustainable procurement practices implemented in
the Greek construction industry the use of green products is limited due to barriers
such as product price, purchasing habits and relationships between purchasers and
suppliers.
The results of this research indicate that the most important factors concerning the
implementation of procurement practices in the Greek construction industry were
strategy development, goal setting and organizational support.
Based on the findings of this paper, a number of measures could contribute in
initiating the process of entrenching green procurement in the Greek construction
industry. These measures can be classified into two broad categories related to
general or specific policy (i.e. construction policy): a) General policy measures and
b) Construction policy measures
The general policy measures should focus on the development of existing legislative
framework for integrating environmental considerations into public procurement.
Construction policy measures should include an appropriate legislative framework
regarding sustainability in construction. The legislative framework regarding
sustainability in construction should be revised in order to encourage the use of
green products supporting not only the procurement process but all the stages of
the whole procedure towards sustainability.
We conclude that future research should be conducted using the same or other
more extended questionnaires and should involve a comparison of the results with
those of other methodological approaches. Alternative methodological approaches
for identifying the above factors towards green procurement would be the Delphi
technique and/or the analytical hierarchical method using pairwise comparison.

6. References

Chan, Albert P. C., Yung, Esther H. K., Yam, Patrick T. I., Tam and C. M. Cheung,
S. O. (2001) “Application of Delphi Method in Selection of Procurement Systems
for Construction Projects“, Construction Management and Economics, Vol. 19,
No 7, pp 699-718. Love, P.E.D., Skitmore, M. and Earl, G. (1998): “Selecting a
suitable procurement method for a building project“, Construction Management
and Economics Vol. 16, pp. 221- 233
Watuka J. and Aligula EM. (2003) Sustainable construction practices in the Kenyan
construction industry: The need for a facilitative regulatory environment
Improvement and Development Agency for Local Government IDALG (2003).
Sustainability and local government procurement, London
Green Procurement (2008), Business and sustainable development: A global guide,
available at: http//www.bsdglobal.com/tools/bt_green_pro.asp

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Sustainable Procurement Group SPG (2003).Report and recommendations of the

sustainable procurement group, January 2003, available at:
http//www.sustainable-development.gov.uk/
documents/publications/report03.pdf
Commission of The European Communities CEC (2001). Commission Interpretive
Communication Communication on the Community law applicable to public
procurement and the possibilities for integrating environmental considerations
into public procurement, Brussels, 4.7.2001, COM(2001) 274
Karanastasis, M. (1998) 'The new legislation on public procurement (public legal
entities, public authorities and public enterprises), Athens (in Greek)

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W11

A multi-faceted approach to construction scheduling research

Alexander Maravas
(Ph.D. Candidate, Centre for Construction Innovation, National Technical University
of Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
Although extensive research has been conducted for the development of an
algorithmic project scheduling methodology allowing optimal resource allocation
and cost control, it has been realized that in real-life situations a pure analytical
approach may not be enough. In the current complex and multi-cultural project
execution environment behavioural and contextual issues should also been taken
into account. As such, issues relating to the organizational structure, personnel
training, negotiation skills and the legal, financial and political context may affect
project scheduling beyond the modelling abilities of pure algorithmic approaches.
To this extent, the aim of this paper is to review the effectiveness of various
research methods in the construction project scheduling process. In particular, the
adequacy of quantitative and qualitative research methods in issues pertaining the
algorithmic formulation, behavioural issues and contextual aspects of construction
scheduling is examined. Special attention is paid to the differences between the
analytical formulation of the problem and human factors in the project context. It is
concluded that a multi-faceted methodological approach is required consisting of
both quantitative elements and qualitative ones based upon the fundamentals of
social and economic sciences.

Keywords
Construction Project Scheduling, Quantitative Research, Qualitative Research

1. Introduction

1.1 Methodological debate in construction management research

The debate for finding the most appropriate research methodology in construction
management has occupied the academic community for many years. At the heart of
this debate lie two opposing philosophies: that of rationalism and of interpretivism.
The research community in the construction industry is dominated by
methodological assumptions of the rationalist paradigm, which draws a distinction
between subjective experience and objective reality. At the other end, the
interpretative approach refers to understanding another’s point of view, rather than
a pure causal understanding which is the aim of the rationalist approach (Seymour
and Rooke (1995)). Therefore, quantitative research methods which emerge from
rationalism gather factual data and study the mathematical relation between facts.
However, qualitative methods, which emerge from interpretivism, focus on the

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quality of the phenomena being investigated rather than numerous measurements

(Sutrisna (2009)).

1.2 The need for methodological pluralism

The use of methodological pluralism in construction management research is

suggested as an alternative to strictly adhering to a single research philosophy.
Raftery et al. (1997) advocate that researchers in the construction field should
conduct research by defining the problem and then applying the most appropriate
method chosen from an unconstrained and wide range of available approaches.
Triangulation and multi paradigmatic approaches should be used in construction
management research since the field is too wide and diverse to allow the adoption
of the simple mono-method approach. Wing et al. (1998) argue that construction
management problems (which encompass economic issues) are multi – faceted.
Therefore, it is difficult to accept that a single research method is appropriate to all
research problems. The fundamental problem concerning construction management
is that of explaining and predicting human behaviour. The way forward is through
methodological pluralism and paradigm diversity. It is clear that all established
research methods and approaches in both the quantitative and qualitative fields
have a contribution to make at various points in the process, depending upon the
existing body of knowledge in the specific area under study, the objectives and
perspectives of the research and the quality of available data. More recently, Dainty
(2008) addressed the issue of multimethodological pluralism in construction
management research. He suggests the move of consideration to multimethodology
rather than the more usual triangulation aspects. By studying papers published in
the journal “Construction Management and Economics” he shows the predominance
of quantitative methods, and discusses the implications of such uniformity before
moving on to address methodological pluralism and the use of techniques from
different paradigms. He concludes that construction management researchers must
show courage in breaking out of single paradigm intransigence.

1.3 Construction scheduling

Construction scheduling is one of the many aspects of construction management.

Effective construction scheduling combined with optimal resource allocation and
cost control is of utmost importance in the implementation of projects in the built
environment. The completion of projects within budget and on time is always a
primary objective for project managers. For many decades the research methods
and techniques pertaining to this issue have primarily followed an analytical –
algorithmic approach. Taking into account the multi–faceted characteristics of the
issue at hand, this paper seeks to find the best approach to conducting research in
construction project scheduling. To this extent, the effectiveness of various
research techniques in the construction project scheduling process is reviewed.

2. Overview of the construction scheduling process

2.1 Scheduling tools

It must be acknowledged that the body of knowledge in construction scheduling has

come both from within and without of the field of construction management
research. Clearly, scheduling tools and techniques may by used in projects of all
types (aerospace, defence, information technology, marketing etc.). As such, today
the major and mainstream scheduling tools can be summarized as follows:
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a) Critical Path Method (CPM), which is a product of research efforts in the late
1950’s in the U.S.A. to minimize construction cost and time (Kelley and Walker
(1959)).
b) Program Evaluation and Review Technique (PERT), which stems from research
efforts in 1958 in the U.S.A. that were aimed at minimizing the time and cost
of the Polaris project of the US Navy (PERT (1958), Malcom et al. (1959)).
c) Linear and repetitive project scheduling tools which are applicable to specific
types of projects (Harmelink and Rowings (1998), Harris and Ioannou (1998)).
d) Fuzzy project scheduling which originates from the application of Fuzzy Set
Theory in scheduling (Chanas and Kamburowski (1981), Prade (1979)).
e) The Critical Chain scheduling method, which was formulated after the Theory
of Constraints (Goldratt (1997)).

2.2 The construction scheduling cycle

Scheduling tools are important and they comprise the core of the construction
scheduling cycle. However, it is important to define the construction scheduling
cycle and frame the research problem in its entirety. Thus, it can be assumed that
the construction scheduling cycle has three distinct phases:
a) Estimation: the primary scheduling variables and parameters such as activity
completion time, labour and machinery productivity, resource availability are
determined based on the experience of the construction manager and/or
analytical calculations.
b) Optimization: the variables are processed with various algorithms, the critical
path is identified, resource usage is levelled and costs are minimized.
c) Implementation: the results of the optimization processes are implemented
in the organization/corporation that is responsible for executing the project.

2.3 Project context and behavioural issues

The construction scheduling cycle is performed in a specific project execution

context with the following aspects: financial and political environment, legal
framework, organizational structure, and corporate politics. The macro-economic
environment has a huge effect on prices and the supply-demand relationship
between clients and contractors. The correct structuring of contracts and their
enforcement determines the commitment to attaining project goals. The role and
power of the scheduling team in the organization is extremely important in regard
to the ease or the barriers by which the results of scheduling tools can be
implemented. Thus, there is a big difference between a scheduling team that has
an advisory role and one that adopts a more pro-active approach. Also, taking into
account resource availability and implementation difficulties in some contexts, near
optimal solutions may be just as well suited as fully optimal solutions.

The construction scheduling cycle is performed by practitioners that have specific

behavioural traits. The main behavioural elements of practitioners are personnel
training, national culture, and negotiation skills. The theoretical and practical
training (i.e. software) of personnel in scheduling is very important. National
culture encompasses the individuals’ commitment to punctuality, adherence to
schedules, and meeting deadlines. The negotiation skills of practitioners in
enforcing the scheduling requirement are also important. In addition, the perceived
and actual benefits from scheduling implementation define the amount of corporate
resources that are allocated in the estimation and optimization phases of the
construction scheduling cycle. Quite frequently deviations from planned schedules
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may lead to a negative preconception of scheduling tools and the limitation of

corporate resources allocated to scheduling.

The combination of contextual and behavioural issues can create complex

situations. Thus, in many cases the implementation of scheduling methods may be
hindered by reasons such as: a) top management does not like the output of
system and eye-pleasing reports are preferred instead of reality, b) people rely on
instinct and trial and error instead of planning techniques c) there is not
appropriate commitment to personnel training (software, project management
principles), high information technology infrastructure and amount of staff and d)
there are low corporate standards for WBS and planning (Kerzner (2003)).

PROJECT CONTEXT

Construction Scheduling Cycle

Estimation Optimization Implementation

BEHAVIOURAL ISSUES

Figure 1: The construction scheduling process

Overall, the construction scheduling cycle consists of three phases: estimation,

optimization and implementation. The construction scheduling process
encompasses the construction scheduling cycle and its relation to contextual
aspects and behavioural issues (Figure 1). This holistic framing of construction
scheduling is fundamental in seeking the appropriate research methods.

2.4 Controllable and non-controllable risk

The effect of risks on the project is very crucial issue during the construction
scheduling process. Examples of controllable risks (internal factors) are project
characteristics, service providers influences and client organizational influences.
Uncontrollable risks (external factors) can consist of socio-economic issues,
unforeseen circumstances, economic and global dynamics, governmental/statutory
controls (Mbachu and Nkado (2007)). In relation to the construction scheduling
process non-controllable risks are crucial in terms of the project context and
behavioural issues. Risks related to the project context are exchange rate volatility,
inflation, a possible energy crisis, fiscal policies, building regulations, health and
environment legislation. Risks related to behavioural issues are workers morale,
labour union demands, and cultural influence. Since non-controllable risk may come
from many different sources it is often difficult to provide contingencies from all
possibilities. Overall, the management of non-controllable risks on construction
schedules is a major challenge for project managers.

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3. Research Methods in the Construction Scheduling Process

3.1 Trends in quantitative and qualitative approaches

In examining the state of applications of quantitative analysis techniques in

construction management by studying publications in two top ranking journals
(Construction Management and Economics, Journal of Construction Engineering and
Management) there is a clear positive trend for papers that incorporate applied
artificial intelligence techniques (Artificial Neural Networks and Genetic Algorithms,
combined ANNs with GAs, fuzzy logic, knowledge based systems and expert
systems), (Hua (2008)). In particular, recent developments in scheduling research
aim at algorithmic advances by finding optimal solutions with the aid of probability,
fuzzy set theory and advanced computational optimization techniques.

While a few truly interpretive studies exist in the field, there is a growing
acceptance of qualitative research in construction management research (Chan and
Littlemore (2009)). Qualitative methods have been considered capable of studying
complex situations, particularly involving human beings and therefore yielding rich
findings. This has resulted in the increase of their popularity, particularly in the built
environment (Sutrisna (2009)). Examples of qualitative methods are structured
interviews, questionnaires and postal surveys.

3.2 The effectiveness and limitations of each approach

3.2.1 Research methods and the construction scheduling cycle

The majority of research methods in the construction scheduling cycle stem from a
pure quantitative approach to scheduling based on optimization and operations
research techniques. Significant quantitative research has also been elaborated in
the estimation of scheduling parameters. However, beyond these two “pillars” of
the scheduling cycle, quantitative techniques present shortcomings in regard to
implementation issues in scheduling. This is due to the limitations of quantitative
techniques in dealing with non mathematical issues. In addition, it should be noted
that the comparison of different algorithmic approaches may be erroneous if the
project is not executed in the same context by practitioners with similar behavioural
traits. Hence, the validity and reliability of a purely optimisation scheduling model is
limited without considering the specific assumptions relating to the complete
project scheduling process.

3.2.2 Research methods and the project context and behavioral

issues

A special mention must be made about the advances attained by the application of
fuzzy set theory and probability in scheduling. These approaches acknowledge the
presence of uncertainty in the project execution environment, which they attempt
to model through a purely mathematical approach. In cases where parameter
estimations are purely statistical and computational the approach dwells purely in
the rationalist domain. Otherwise, when the scheduling parameters originate from
subjective and fuzzy estimations, such as practitioner assessments of best and
worst case scenarios, the methods have an interpretative aspect. Even though the
analysis is mathematical, it stems from an individuals perception of reality which

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definitely has an interpretative element. This means that the trend of quantitative
research is in the right direction, since these methods provide a connection
between the construction scheduling cycle, the project context and behavioural
issues. However, effort must be made in clarifying the process in which the
perception of uncertainty is quantified since in many instance fuzzy estimates are a
convolution of uncertainty from many distinct sources. Overall, probability theory
and fuzzy set theory although quantitative increase the validity and reliability of
research methods in scheduling because they provide a means of modelling
contextual and behavioural issues.

A better defined relation of project context and behavioural traits to each element
in the project cycle should be sought with qualitative techniques as well as
fundamentals from the economic and social sciences. Undoubtedly, research
techniques from economics can help us understand project developments in relation
to the macro-economic environment. Methodologies from psychology and sociology
can also be useful in comprehending the behaviour of practitioners in corporations.
It is understood that although very interesting discoveries may be made through
this approach, their generalization may in some cases prove to be somewhat
difficult.

In conclusion, the construction scheduling cycle is performed in a specific context

by people that have specific behavioural traits. Altogether the scheduling process is
broader than the scheduling cycle and scheduling tools which are the main target
point of academic research. Failure to comprehend this process means that the
result of academic research may fall short of the true requirements of scheduling in
the built environment.

4. The multi – faceted approach

Construction management and economics (CME) research as a multidisciplinary

design science aims to produce multidisciplinary solution concepts that can be used
in solving complex and relevant field problems in design, production and operation
of the built environment. The output of CME research as a multidisciplinary design
science consists of three types of solution concepts (Voordijk (2009)):
- Technological laws: empirical generalizations based on statistical data
analysis
- Functional rules: concepts that specify what to do, if a certain result is to be
attained under given circumstances
- Socio technological understanding: insights in the interrelationships between
construction processes and social practice.

The correct framing of construction scheduling has proven to be extremely useful in

assessing the effectiveness of various research methods. Clearly, the complexity of
the nature of construction scheduling warrants a multi-faceted approach. Thus, in
adopting a holistic stance in scheduling research, a multi-faceted approach to the
construction scheduling process could have the following structure:
- Technological laws: scheduling tools for estimation and optimization.
- Functional rules: for schedule implementation, interaction of project context
and scheduling cycle.
- Socio technological understanding: for a complete mapping of behavioural
issues to the construction scheduling cycle.

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The greatest foreseen challenge in this approach is the interaction and coordination
of different research methods. Realistically, this can only be accomplished by the
development of multi-disciplinary research groups. Researchers must understand
the limitations of their knowledge and seek to establish cooperation with specialists
from other fields. For example, such a group could be comprised of civil engineers,
architects, economists, psychologists, mathematicians, lawyers and sociologists. In
all cases the issue of complementarities of research findings must be addressed and
multi-faceted solution concepts should not be antagonistic to each other. Also,
innovative research techniques such as knowledge mining from many information
sources (Palaneeswaran and Kumaraswamy (2003)) could prove to be very useful.

As noted by Hughes (1994) “In a new academic field it is necessary not only to
undertake the research but also to invent a methodology”. In this respect the multi-
faceted approach is a new methodology which needs to be defined in greater detail
and will require researchers to break out of their existing knowledge barriers. The
greatest challenge in this approach is how the results of the different techniques
from different paradigms will be combined and interpreted by the principal
researcher.

5. Conclusions

The need for a multi-faceted approach to construction scheduling has been

demonstrated by correctly framing the construction scheduling process. The
scheduling cycle has been appropriately defined and well as its interaction with the
relative project context and behavioural issues. The limitations of quantitative and
qualitative techniques in various aspects of the scheduling process have been
clearly laid out.

It is encouraging that the trends in quantitative research through probabilistic and

especially fuzzy techniques achieve a mixture of rationalist and interpretative
research philosophy and are a definite improvement over the outdated
deterministic approach. At the same time there are plenty of issues pertaining to
the project context, behavioural issues and schedule implementation that require
qualitative analysis. The multi-faceted approach could be effective in mapping and
providing contingencies from non-controllable project risks that come from many
sources.

Multi-disciplinary research groups are proposed as a means to providing the best

approach to this multi-faceted problem. The primary goal of this approach is to set
technological rules, functional rules and enhance socioeconomic understanding. In
this respect, let us envisage a scheduling handbook that also has a chapter or two
on the fundamentals of the national economy as well as the basics of human
psychology.

6. References

Chan, P.W. and Littlemore, M. (2009), “Methodological challenges in uncovering

“Hidden” agendas in organisations”, in: A. Ross (ed.), Proceedings of the
Association of Researchers in Construction Management (ARCOM) Doctoral
Workshop – Liverpool Research Methods Doctoral Workshop.
Chanas, S. and Kamburowski, J. (1981), “The use of fuzzy variables in PERT”,
Fuzzy Sets and Systems, 5 (1), 11-19.

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Dainty, A. (2008), “Methodological pluralism in construction management research”

in: A. Knight, L. Ruddock (eds), Advanced Research Methods in the Built
Environment, Wiley-Blackwell, Chichester.
Goldratt, E.H. (1997), “Critical Chain”, The North River Press, USA.
Harmelink, D. and Rowings, J. E., (1998), “Linear Scheduling Model: Development
of Controlling Activity Path”, Journal of Construction Engineering and
Management 124(4), 263-268.
Harris, R.B. and Ioannou, P.G. (1998), “Scheduling projects with repeating
activities.”, Journal of Construction Engineering and Management, 124(4), 269-
278.
Hua, G.B. (2008), “The state of applications of quantitative analysis techniques to
construction economics and management (1983 to 2006)”, Construction
Management and Economics, 26(5), 485-497.
Hughes, W. (1994), “The PhD in Construction Management”, Proceedings of the
10th Annual ARCOM confererence – Loughborough University.
Kelley, J.E. and Walker, M.R. (1959), “Critical-path planning and scheduling”,1959
Proceedings of the Joint Computer Conference, Boston, Massachusetts, Dec 1-3,
1959, pp. 160-173.
Kerzner, H. (2003), “Project Management: A Systems Approach to Planning,
Scheduling, and Controlling” (8th Edition), John Wiley, New Jersey.
Malcom, D.G., Roseboom, J.H., Clark, C.E. and Fazar, W. (1959), “Application of a
technique for research and development program evaluation”, Operations
Research, 7, 646-669.
Mbachu, J. and Nkado, R. (2007), “Factors constraining successful building project
implementation in South Africa”, Construction Management and Economics,
25(1), 39-54.
Palaneeswaran, E. and Kumaraswamy, M.M. (2003), “Knowledge Mining of
Information Sources for Research in Construction Management”, Journal of
Construction Engineering and Management, 129(2), 182-191.
PERT Summary Report (1958), Bureau of Ordnance, Department of the Navy,
Washington, DC.
Prade, H. (1979), “Using Fuzzy Set Theory in a Scheduling Problem: A case study”,
Fuzzy Sets and Systems, 2, 153-165.
Raftery, J., McGeorge, D. and Walters, M. (1997), “Breaking up methodological
monopolies: a mulit-paradigm approach to construction management research”,
Construction Management and Economics, 15(3), 291-297.
Seymour, D. and Rooke, J. (1995), “The culture of the industry and the culture of
research”, Construction Management and Economics, 13(6), 511-523.
Sutrisna, M. (2009), “Research Methodology in Doctoral Research: Understanding
the Meaning of Conducting Qualitative Research”, in: A. Ross (ed.), Proceedings
of the Association of Researchers in Construction Management (ARCOM)
Doctoral Workshop – Liverpool Research Methods Doctoral Workshop.
Voordijk, H. (2009), “Construction management and economics: the epistemology
of a multidisciplinary design science”, Construction Management and
Economics, 27(8), 713-720.
Wing, C.H., Raftery, J. and Walker, A. (1998), “The baby and the bathwater:
research methods in construction management”, Construction Management and
Economics, 16(1), 99-104.

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AA117

Uncertainty in Scheduling Multiple Projects

Alexander Maravas
(Ph.D Candidate, Centre for Construction Innovation, National Technical University
of Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Sergios Lambropoulos
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
Whereas there is ample research literature available on uncertainty in single
projects, research on studying uncertainty in a multi-project environment is scarce.
As such, this paper aims at establishing a framework for modelling uncertainty in
scheduling multiple projects. The primary focus is determining the feasibility of the
fuzzy set theory application in the modelling of scheduling uncertainty in the
contemporary dynamic project execution environment. Issues such as duration
uncertainty, resource availability and multiple project objectives are examined. It is
concluded that the proposed methodology could be particularly useful in practical
applications.

Keywords
Fuzzy Project Scheduling, Multiple Project Management

1. Introduction

1.1 Uncertainty in the scheduling of single projects

The management of projects in an uncertain environment requires decisions that

are based on inconsistent, vague and imprecise data. The shortcomings of
traditional scheduling methods such as CPM and PERT, that employ a deterministic
or a probabilistic view respectively, mandate the formulation of a new methodology
to meet the real-world requirements. Probability theory and fuzzy set theory are
two different approaches for the management of project uncertainty. Probability
theory deals with random events by assigning probability distributions to the data
that is necessary for making decisions. Alternatively, fuzzy set theory deals with the
imprecision of data that must be processed in order to manage projects. Fuzzy
Project Scheduling (FPS) is based on fuzzy set theory and is useful in dealing with
circumstances that involve uncertainty, imprecision, vagueness and incomplete
data.

In terms of Fuzzy Project Scheduling, Prade (1979) was the first researcher to
propose the application of fuzzy set theory in scheduling problems. Chanas and
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Kamburowski (1981) presented a fuzzy version of PERT which they named FPERT.
Important research in Fuzzy Project Scheduling has been conducted by McCahon
and Lee (1988), Hapke et al. (1996), Lorterapong and Moselhi (1996), Dubois et al.
(2003), Bonnal et al. (2004). Overall there have been about 40 papers published in
major international journals addressing various aspects of this new scheduling
approach.

1.2 Multiple project management and scheduling

The management of a group of projects has significant differences from the

management of a single project. Project orientation in an organization is the term
used to describe the preference of managing by projects and the development of
project management competence (ICB, (2006)). In this context, multiple projects
are brought together for the sake of control, coordination and optimisation, so that
their implementation achieves strategic goals and benefits for the organization.
Today, project orientation and multi-project management is emerging as a
predominant strategy in private-enterprise organizations (construction contractors)
and government organizations (public works).

In the multi project environment single projects compete for organizational

resources with other projects. Hence, significant effort is directed in resolving
resource insufficiencies and conflicts. Engwall and Jerbrant (2003) argued that the
allocation of resources to (and between) simultaneous and successive projects is a
very complex process that is related to deeply embedded features of the
organization. Also, special attention should be paid to project interdependencies
and lack of resources, priority setting and resource allocation, competition between
projects and short term problem solving. Blichfeldt and Eskerod (2008) discussed
resource allocation difficulties in organizations managing portfolios of projects.
Patanakul and Milosevic (2009) studied the effectiveness of management in
multiple projects. They concluded that project assignment, resource allocation and
organizational culture are important at the organizational level whereas project
management processes and competencies of multiple project managers are critical
at the operational level. Scheinberg and Stretton (1994) demonstrated an approach
using a balancing method that improves the development, evaluation and making
of planning decisions related to portfolios of projects by incorporating a wide range
of business variables (indices) into the decision process.

As such, a generic framework with guidelines for the management/scheduling of

multiple projects could consist of the following elements (ICB, (2006)):
1. List and prioritise programmes and projects inline with the organization’s
strategies and goals.
2. Allocate resources to the portfolio. Balance supply with demand.
3. Define standard processes, tools and reporting schemes to be used in all
programmes/projects of the portfolio and establish support functions.
4. Continuously monitor and control the programmes/projects of the portfolio.
Initiate corrective actions.
5. Delete programmes/projects from the portfolio when they are no longer
relevant to the business strategy and ensure there is a feedback mechanism
for lessons learnt.
6. Select and add new projects/programmes to the portfolio.

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1.3 Uncertainty in multiple projects

In recent years the study of uncertainty in the scheduling of multiple projects has
emerged as a dynamic research domain. Tong and Tam (2003) introduced a fuzzy
optimization model for resource allocation with the use of genetic algorithms.
Nozick et al. (2004) studied the relationship between resource requirements and
the probability distributions of the durations of individual tasks. Thereafter, they
proposed a non-linear mixed integer programming model with a heuristic solution
procedure for optimizing resource allocations to individual tasks that minimize the
weighted completion times of a collection of projects and the overuse of resources.
East and Liu (2006) presented a model of the mobilization requirements of multiple
crews performing a variety of different activities over a geographic space. A
computer system called FIRS (Facility/Infrastructure Resource Schedule), was
created to analyze multi–project resource plans with the utilization of a genetic
algorithm in multi-project scheduling. The system identifies true mobilization costs
of project priority and crew assignment decisions. Wu (2007) proposed a fuzzy
linear programming approach for manpower allocation among projects within a
matrix organization. Medaglia et al. (2007) proposed an evolutionary method for
project selection problems under uncertainty with partially funded projects, multiple
(stochastic) objectives, project interdependencies and a linear structure for
resource constraints. Laslo and Goldberg (2008) studied the unavoidable resource
conflicts that arise in organizations with matrix structures because project
managers and functional mangers struggle for greater control over the allocation of
organizational resources. They developed a simulation procedure to study the flow
of resources in a multi-project setting under conditions of uncertainty as a means
to examine the possibility of unnecessary and unrealistic conflicts.

2. Fundamentals of Fuzzy Set Theory

Fuzzy set theory is used to characterize and quantify uncertainty and imprecision in
data and functional relationships. Fuzzy set theory permits the gradual assessment
of the membership of elements in a set in the real unit interval [0, 1]. Hence, a
fuzzy set A of a universe X is characterized by a membership function μΑ: X[0,1]
which associates with each element x of X a number μA(x) in the interval [0,1]
representing the grade of membership of x in A. In fuzzy set theory the triangular
membership function which is defined by three numbers a, b, c is encountered very
often. At b membership is 1, while a and c are the limits between zero and partial
membership. The triangular fuzzy number x~  a, b, c has the following membership
function:
0 x  a

( x  a ) /( b  a ) a  x  b
 A (x)   (1)
(c  x ) /(c  b ) b  x  c
0 x  c
With any fuzzy set A we can associate a collection of crisp sets known as α-cuts
(alpha-cuts) or α-level sets. A α-cut is a crisp set consisting of elements of A which
belong to the fuzzy set at least to a degree of α. Therefore, if A is a subset of a
universe U, then an α-level set of A is a non-fuzzy set denoted by Αα which
comprises all elements of U whose grade membership in A is greater than or equal
to α (Zadeh, 1975). In symbols,
A  {u |   (u )   } (2)
where: α is a parameter in the range 0 <α ≤ 1 .
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3. Multi project scheduling methodology

3.1 Mathematical formulation

Consider an organization that is responsible for a set of multiple project P1, P2,…,
Pn. Every project has a set of activities ap1, ap2,…, api (p: project index, i: activity
index). There is a common resource pool with resources R1, R2,…, Rn that can be
assigned to activities in separate projects. Individual projects can start at different
points in time within the overall timeline. Their start time depends primarily on
organizational strategy and may be modified due to resourcing conflicts. The
objective of multi-project scheduling is to finish the projects in the shortest time
while assuring the best utilization of the shared resources (Fig. 1).

Resource Pool
Project 1
R1
Project 2
R2 …
. Project N
.
. act 1

act 2

Rn Timeline act n

Figure 1: Scheduling of multiple projects

3.2 Fuzzy CPM

Initially, the most appropriate membership function for the duration of every
activity is selected through a process called fuzzification. Thus, project activities can
have durations that are fuzzy numbers instead of crisp numbers. Thereafter, the
fuzzy project scheduling algorithm is applied to each individual project – meaning
that the formula for the forward recursion is applied to the activities using fuzzy
arithmetic. Essentially, the fuzzy formulation of the CPM algorithm is based on the
forward pass of the data that is performed by calculating the early start and early
finish.
~ ~ ~ ~ ~ ~
E S start  0 , E F  E S()d and E S  m~
a x(E Fp ) (3)
pP
~ ~
Where: p: is the preceding activity, P: is the set of preceding activities, E S / E F : is
~
the fuzzy early start/finish time, d : is the fuzzy activity duration,   : is the fuzzy
~
addition operator, m a x : is the fuzzy maximum operator.
Unlike CPM, FPS calculates the criticality of paths of the network instead of
activities.
 
C P ( i )  sup   ~ ( x )   ~ ( x ) (4)
  P ( i ) T 

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~ ~
T P i    dp
p  P i 
(5)

Where:
sup : is the largest value of a set, Pi  : a path i from the first to last node of the
~
network, C P (i ) : the degree of criticality of path i, T P ( ) : the fuzzy duration of path i,
~
T : the fuzzy completion time of the project,  : the membership function of the
path.

In other words, the degree of criticality of a path i, is equal to the maximum of the
intersection of the membership function of the fuzzy duration of path i with the
fuzzy duration of the project. The concept of critical activities is related to the
assessment of path criticality. Thus activities that belong only to one path assume
their criticality from that path. In the event that activities that are common to more
than one path, the activity criticality takes the largest value of the paths that it
belongs to (Lorterapong (1996)).

3.3 Resource allocation

The application of the FPS algorithm yields the fuzzy start and completion
dates of the activities as well as the activity criticality degrees. In order to
calculate the required usage/time of each resource it is necessary to divide
the total amount of units assigned to each activity with its duration.
However, the activity duration varies for different possibility measures and
for optimistic and pessimistic scenarios. In the absolute best case (minDα)
the activity will start as early as possible and will last the minimum duration.
In the absolute worst case (maxDα) the activity will start as late as possible
and will last the maximum duration (Maravas and Pantouvakis (2010)). It is
possible to calculate these intervals as follows:
min D  (inf Start, inf Start  inf Duration)
max D  (sup Start , sup Start  sup Duration)
where: Dα: is the interval of minimum/maximum duration at the respective level α
(α-cut), inf: infimum (least), sup: supremum (greatest).

The overall resource utilization profile is simply the sum of the unit/time usage of
each resource per each activity from all projects. Because the resulting durations
may not be integers they are rounded up/down accordingly. In this paper, it is
assumed that the uncertainty in the duration of the activity and the amount of
resource units are uncorrelated.

3.4 Visualization of Resource Allocation

The visualization of the resource allocation of activities with duration uncertainty is

extremely important in evaluating the necessity for resource levelling. As an
example consider two activities A, B whose durations are triangular fuzzy numbers
as shown in Table 1. The fuzzy GANT chart is shown in Figure 2.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
time

Figure 2: Fuzzy GANT chart of activities A, B.

Early Start Duration Early Finish

A 1 2 3 4 6 9 5 8 12
B 6 8 9 5 7 9 11 15 18

Table 1. Duration data of activities A and B.

16
14
A B
12
Resource units

10

6
4

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
time

(a) μ=1
16

14

12 A B
resource units

10

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
time

(b) μ=0, optimistic

12

10 A B

8
resource units

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
time

(c) μ=0, pessimistic

Figure 3: Resource usage for different cases.
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Figure 3 depicts a stacked histogram of a resource R1 that has 70 units assigned to

activity A and 40 units to activity B. At μ=1 there is one peak resource demand at
time period 9 (Fig. 3a). At the optimistic scenario at μ=0 there is a significant peak
usage at time periods 1 to 5 (Fig. 3b). At the pessimistic scenario at μ=0 the peak
period has a lower resource demand since the activities are spread out further in
time (Fig. 3c). If the resource limit usage is 12 units per time period then there is a
small problem in Fig. 3a, a significant problem in Fig. 3b and no problem at all in
Fig. 3c.

With this simple example it is evident that resource allocation is not the same in
different possibility levels and at optimistic and pessimistic scenarios. The use of a
visualization tool can identify peak resource usage coming from many activities
from several projects. In practice, the stacked resource usage histogram can be
created for 11 possibility levels (0, 0.1, 0.2,…,1) which represent different risk
levels. At μ=1 there is no risk at all. However, the risk level increases as μ moves
towards 0.

3.5 Resource levelling

In multi-project project scheduling resource over-allocations can be resolved in two

manners: i) by changing the amount of resource usage within activities of one
project. In this case several resource levelling techniques exist in the literature.
Some of these are based on setting priority heuristics based on scheduling
parameters such as Early Start, Early Finish, Late Start Late Finish, etc. ii) by
reassigning resources from one project to another. In the second case project
priorities must be set so that preference is given to a particular project while
resolving conflicts.

After the project fuzzy start and finish dates have been determined by the
application of the fuzzy CPM algorithm and resource usage has been determined,
resource levelling is applied with a heuristic algorithm that uses a priority list.
Although priority heuristics yield near optimal and not pure optimal solutions they
are still useful in scheduling practice. The following rules could be used:
1. Project priority (activities within a project are assigned the priority-level of
the project)
2. Degree of activity criticality
3. Early start, early finish.

It is obvious that if all projects have the same priority then the problem reduces to
that of resource levelling a single project. The use of the degree of criticality is
important since it ensures that resources are allocated to activities that affect the
project completion date.

4. Conclusions

This paper has succeeded in presenting a framework in which fuzzy project

scheduling and resource levelling is utilized to deal with the uncertainty of
scheduling multiple projects. The proposed methodology has succeeded in:
a) Providing a means to visualize the utilization and possible over-allocation of
resources in different projects that have different strategic priority.

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b) The ability to view resource utilization at different possibility levels (α-cuts) and
at optimistic and pessimistic scenarios, from which it is discovered that resource
conflicts do not exist at all risk levels.
c) Presenting an algorithm for resource levelling based on heuristics such as
project priority and activity criticality.
Overall, there is a direct relation between the project managers perception of
uncertainty in the duration and resource availability. Further research will be aimed
at testing the methodology on a wider sample of schedules with many simulation
runs. It is believed that the methodology could be a useful scheduling-tool for
private-enterprise and government organizations that are engaged in multi-project
management.

5. References

Blichfeldt, B.S.B. and Eskerod P. (2008), “Project portfolio management – There’s

more to it than what management enacts”, International Journal of Project
Management, 26, 357-365.
Bonnal, P., Gourc, K. and Lacoste, G. (2004), “Where do we stand with Fuzzy
Project Scheduling?”, Journal of Construction Engineering and Management,
130 (1), 114-123.
Chanas, S. and Kamburowski, J. (1981), “The use of fuzzy variables in PERT”,
Fuzzy Sets and Systems, 5 (1), 11-19.
Dubois, D., Fargier, H. and Galvagnon, V., (2003), “On latest starting times and
floats in activity networks with ill-known durations”, European Journal of
Operational Research, 147, 266-280.
East, E.W. and Liu L.Y. (2006), “Multiproject Planning and Resource Controls for
Facility Management”, Journal of Construction Engineering and Management,
132(12), 1294-1305.
Engwall, M. and Jerbrant A. (2003), “The resource allocation syndrome: the prime
challenge of multi-project management?”, International Journal of Project
Management, 21, 403-409.
Hapke, M., Jaskiewicz, A. and Slowinski, R. (1994), “Fuzzy project scheduling for
software development”, Fuzzy Sets and Systems, 67, 101-117.
Hapke, M. and Slowinski, R. (1996), “Fuzzy priority heuristics for project
scheduling”, Fuzzy Sets and Systems, 83, 291-299.
ICB (2006), “IPMA Competence Baseline”, Version 3.0, Caupin G., Knoepfel H.,
Koch G., Pannenbacke K., Perez-Polo F. Seabury C. (eds), International Project
Management Association, The Netherlands.
Laslo, Z. and Goldberg, A.I. (2008), “Resource allocation under uncertainty in a
multi-project matrix environment: Is organizational conflict inevitable?”,
International Journal of Project Management, 26, 773-788.
Loftus, J. (1999), “Project management of multiple project and contracts”, Thomas
Telford Publishing, London.
Lorterapong, P. and Moselhi, O. (1996), “Project-network analysis using fuzzy sets
theory”, Journal of Construction Engineering and Management, 122 (4), 301-
318.
Maravas, A. and Pantouvakis, J.P., (2010), “A study of cash flow in projects with
fuzzy activity durations”, Proceedings of the International Conference on
Computing in Civil and Building Engineering, Nottingham.

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Medaglia, A.L., Graves, S.B. and Ringuest, J.L. (2007), “A multiobjective

evolutionary approach for linearly constrained project selection under
uncertainty”, European Journal of Operational Research, 179, 869-894.
McCahon C.S. and Lee, E.S., 1988. “Project network analysis with fuzzy activity
times”, Computers and Mathematics with Applications., 15(10), 829-838.
Nozick, L.K. Turnquist, M.A. and Ningxiong, X. (2004), “Managing Portfolios of
Projects under Uncertainty”, Annals of Operations Research, 132, 243-256.
Patanakul, P. and Milosevic, D. (2009), “The effectiveness in managing a group of
multiple projects: Factors of influence and measurement criteria”, International
Journal of Project Management, 27, 216-233.
Prade, H. (1979), “Using Fuzzy Set Theory in a Scheduling Problem: A case study”,
Fuzzy Sets and Systems, 2, 153-165.
Scheinberg, M. and Stretton, A. (1994), “Multiproject planning: tuning portfolio
indices”, International Journal of Project Management, 12(2), 107-114.
Tong, T.K.L. and Tam, C.M. (2003), “Fuzzy optimization of labour allocation by
genetic algorithms”, Engineering Construction and Architectural Management,
10(2), 146-55.
Wu, Y.K. (2007), “On the manpower allocation within matrix organization: a fuzzy
linear programming approach”, European Journal of Operational Research,
183(1), 384-93.
Zadeh, L.A. (1975), “The Concept of a Linguistic Variable and its Application to
Approximate Reasoning-I”, Information Sciences, 8, 199-249.

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ITPM4
An Integrated Information System for Monitoring Construction
Works

Alexander Maravas
(Deputy Manager of Project Monitoring, Egnatia Odos S.A., Thessaloniki, Greece)

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AA046
Prediction of earthmoving trucks deterioration
using discriminant analysis

Marina Marinelli
(Ph.D. Candidate, National Technical University of Athens, Athens, Greece)

Sergios Lambropoulos
(Associate Professor, National Technical University of Athens, Athens, Greece)

John–Paris Pantouvakis
(Associate Professor, National Technical University of Athens, Athens, Greece)

Abstract
Predicting the condition of construction equipment is a crucial matter for the
building industry since it directly affects the company’s investment planning thus
resulting in considerable financial effects. Accurate predictions could be useful for
the planning of future requirements concerning equipment maintenance,
replacement or procurement as well as for ongoing earthmoving operations.
Towards the above, this research implements a stochastic model based on
discriminant analysis and evaluates its effectiveness. In particular, discriminant
analysis is applied to data provided by two large Greek Construction Companies and
attempts to classify the vehicles in several predefined condition levels, according to
their characteristics of age, kilometers traveled to date and maintenance status.
The results demonstrate that the performance of the prediction model is strongly
dependent on the maintenance policy of the company, which forms the most
substantial factor for further evaluation in the course of an effective total cost
management.

Keywords
Condition prediction, Earthmoving trucks, Maintenance, Discriminant Analysis

1. Introduction

Earthmoving equipment represents a major investment for the construction

industry since its acquisition and maintenance involve a significant cost. Moreover,
its continuous and intense use results in a high wear pace. The abovementioned
facts justify the imperative need for effective policies concerning earthmoving
equipment operation, maintenance and replacement. The capability to reliably
predict the deterioration of equipment would significantly contribute to the
achievement of the above.

This research focuses on the implementation of a deterioration prediction model to

earthmoving wheel trucks. The analysis involves the fleet data and the equivalent

maintenance records of two large scale Greek construction companies and is based
on the implementation of the statistical procedure of Discriminant Analysis.

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2. Literature Survey

During the last decades, the increasing need for managing infrastructure resulted in
the development of new models yielding a satisfactory prediction for their future
condition.

Literature survey of the subject identifies numerous researches focusing on the

prediction of bridges’ and pavements’ deterioration based on various models such
as Markovian chains (Jiang and Sinha, 1994; Morcous and Lounis, 2006; Adedimila
et al., 2009), Binary Probit Model (Bulusu and Sinha, 1997), Monte-Carlo simulation
(Enright and Frangopol, 1998; Frangopol et al, 2001; Kong and Frangopol, 2004),
Fuzzy Logic Techniques (Zhao and Chen, 2002), Linear Mixed Effects Model (Yu et
al., 2007). Each of the aforementioned methods counts several advantages and
disadvantages and most of them have been employed to Infrastructure
Management Systems in U.S.A. Respective research has also been developed at the
area of drainage systems with the employment of techniques such as the Ordered
Probit Model (Baik et al., 2006) and the Neural Networks (Tran et al., 2007).

The research regarding vehicles’ deterioration prediction is not equally extensive.

The most relevant research refers to models that have been developed and applied
to public transportation vehicles. Ludwig (1997) developed a wear prediction model
for the bus fleet of the New Jersey Public Transportation Organization. This model
was first applied to diesel engines and provides the wear pace of the vehicles in
connection with its classification to a certain condition level. The model takes into
account the fact that condition levels appertain to a discrete scale but it does not
consider the effect of other factors such as vehicle mileage. Karlaftis and Sinha
(1997) used data provided by the Organization of Urban Transportation of
Indianapolis, USA in order to develop a prediction model for buses based on
Ordered Probit methodology. This methodology not only recognizes the vehicle’s
condition levels as a scale of discrete numbers, but also links the vehicle’s
deterioration to a set of variables such as bus age, mileage, maintenance history
and climate region. However, the methodology provides quantitative predictions
related to the composition of a fleet as a whole and cannot be applied to a specific
vehicle. Chang and Collura (1997) developed for the Armhest, Massachusetts
Transportation System a model providing bus deterioration prediction, based on
Ordered Probit Methodology and involving the age of the vehicle, the milage, its
capacity, the engine’s probable overhaul and the weather conditions. Karlaftis
(1997) developed for the bus fleet of the Organization of Urban Transportations of
Athens (OASA) a model that predicts the individual deterioration of each vehicle,
using Discriminant Analysis methodology. An equivalent research presented by
Sawicki and Zak (2009) addresses the classification of a fleet of vans as far as their
technical condition is concerned, through the evaluation of particular characteristics
(e.g. exhaust gas components, service break efficiency, condition of the body,
mileage) using Rough Set Theory.

3. An introduction to Discriminant Analysis

Discriminant analysis is an analytical technique whereby a multivariate data set

containing a total of n quantitative and/or categorical variables is separated into k
pre-defined groups, using discriminant functions.

The number of discriminant functions f is equal to the minimum of the number of

groups minus one and the number of variables; thus f=min (k-1, n).
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Each discriminant function Dj, j=1…f, is a linear transformation of the n variables xi,
i=1…n, as shown in equation (1).

Dj=B j0 +B j1 *X1+B j2 *X2 +...+B jn *Xn

(1)

The constant Bj0 and the coefficients Bji are determined by maximizing the
between-class variance relative to the within-class variance from sample data. The
first discriminant function corresponds to the linear combination of variables that
best separates the groups; the second is orthogonal to the first and is the next
combination of variables and so on. Plotting the discriminant functions scores that
emerge from applying the values of the variables locates the position of the
respective observation in the f-dimensional space and thus, visualizes the
discrimination of the groups. Figure 1 indicatively illustrates the case of three well-
discriminated groups of observations.

Fig 1: Example of well-discriminated groups

Another major purpose to apply discriminant analysis is the predictive classification

of new cases. Once a model has been finalized and the discriminant functions have
been derived, classification functions are calculated towards the determination of
the group where a new case mostly belongs. The number of linear classification
functions is equal to the number of groups as each one has its own classification
function. The criterion of the classification is the score which is obtained through
each function for employing the variables’ values that correspond to the new case:
The greatest score indicates the group that is the most representative for the case
under examination.

The usage of the classification functions for the re-classification of the sample data
is a direct and effective way to check the reliability of the method as a means of
classification. It is obvious that a reliable tool is expected to classify the great
majority of the observations in the class that they are actually known to appertain.
An alternative way to check the consistency of the classification is the iterative
“holdout method”, whereby all data –with the exception of one case- is used to
calculate the linear classification functions, which are then used to classify the
omitted case either correctly or incorrectly.

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4. Earthmoving truck deterioration prediction using discriminant

analysis

Concerning this research, the original data set was provided by two Greek
construction companies and includes the characteristics of 126 earthmoving trucks
with regard to their capacity, age, kilometers traveled to date, and maintenance
and condition levels. The objective is to employ discriminant analysis and find,
amongst the available characteristics of the trucks (capacity, age, kilometers,
maintenance class), those that best separate them as far as the different condition
levels are concerned. Following this, the classification functions that the analysis
defines, can be used for the assignment of any other truck of known respective
characteristics, to the level condition that it appertains.

Concerning the condition level, the initially provided data set including ten levels
ranging from 0.1 to 1, was transformed to a more flexible condition scale of 5
levels, each of which is represented by a discrete number from 0 to 4, according to
the following description:

 Level 0: the vehicle’s operation is impossible or involves high safety risk

 Level 1: the vehicle presents frequent failures requiring major unscheduled
repairs
 Level 2: the vehicle presents frequent failures requiring minor unscheduled
repairs or infrequent failures requiring major unscheduled repairs
 Level 3: the vehicle presents rare failures requiring minor unscheduled
repairs
 Level 4: the vehicle presents no failures nor unscheduled repairs

As far as the maintenance level is concerned, the relevant policies of the

companies result in the following classification:

 Class 1: The truck undergoes regular maintenance as scheduled

 Class 2: The truck undergoes extensive component replacement upon each
project’s completion.

The provided data are summarized in Table 1.

Variables Condition Level

1 2 3 4
Age (years) 10-16 10-32 9-31 11-31
Kilometers 474,832-510,886 24,520-600,662 3,113-877,847 3,296-295,324
Capacity (m3) 13-15 14-22 9-26 11-20
Maintenance 1 1 1&2 2
Number of trucks 2 38 60 26

Table 1: Summary of sample data

The analysis, performed with the Statistical Package SYSTAT, yields the
discrimination functions and the relevant illustration of the discriminant function
scores as bivariate plots for various combinations of the discriminant functions
(Figure 2). The plotting makes clear the fact that the discrimination of the different
groups of trucks is not satisfactory and therefore the prediction of new trucks’
condition level is not expected to be sufficiently reliable.

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Fig 2: Plot of discriminant functions scores

Further to the above, discriminant analysis can yield the contribution of each
variable to the groups’ discrimination. The corresponding statistic index is the index
“F-to remove”, which particularly represents the relative importance of the
variables included.

“F-to remove” index as presented in Table 2 demonstrates that the maintenance

level has a far greater impact than the other variables. The above is also confirmed
by the procedure of stepwise discriminant analysis which allows for stepwise
omission of the variables that do not significantly contribute to the discrimination of
the condition levels. Stepwise analysis yields the maintenance level as the major
discriminative factor followed by the kilometers traveled.

Variable F-to remove index

1 age 0.286
2 capacity 0.695
3 kilometers 33.519
4 maintenance 99.113

Table 2: Relative importance of the variables of the model

The next phase of the analysis includes the determination of the classification
functions and the re-classification of the sample data according to them. The
Classification Table (Table 3) which indicates the actual condition level and the
condition level calculated from the linear classification functions for each truck,
demonstrates that the analysis failed to assign a significant percentage of the
trucks of groups 2 and 3 to the correct group. Specifically, a 42% of the
observations appertaining to group 2 were misclassified while the respective
percentage for group 3 reached the 28%. Similarly reduced consistency is obtained
by the aforementioned “hold-out” method.

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Condition level % correct

1 2 3 4
1 2 0 0 0 100
2 16 22 0 0 58
3 0 10 43 7 72
4 0 0 1 25 96
total 18 32 44 32 73

Table 3: Classification Table for the sample data

5. Evaluation of the model’s performance and significance

As it became apparent, the discrimination of the sample data for the used variables
is not clear and consequently a reliable classification of new observations cannot be
achieved. However, the said insufficiencies are strongly related to the determinant
impact of maintenance and particularly to the fact that the maintenance policy
involving frequent and extensive component replacement, eliminates the impact of
factors such as the age and the kilometers traveled, that are normally expected to
have a significant role on a vehicles’ deterioration. In fact, such a maintenance
policy directly defines the condition level and thus reduces the significance of a
deterioration prediction model. Therefore, any kind of reliable equipment condition
prediction strongly depends on the level of its maintenance and thus, the main
objective of the effective operational cost management must be the evaluation of
the maintenance policy applied, in correlation to the financial effects it involves.
Towards this, the examination and comparison of actual cost data deriving from the
implementation of substantially different maintenance policies to equivalent cases
of equipment is advisable, provided that the company applies a consistent system
for the monitoring of the equipment’s performance and the collection of the
necessary data.

Given the above, it would be advisable to attempt the discrimination of the trucks
that are classified to the regular maintenance level so that the determinant impact
of this factor is eliminated and the impact of the other factors is allowed to be
observable and measurable: As illustrated in Figure 3, the models’ discrimination
ability for the trucks of maintenance level 1 has improved. The variable that most
contributes to the discrimination is the kilometers traveled (F=22,846), while the
age seems to have a significantly limited impact (F=3,184) and the trucks’ capacity
a rather negligible one (F=0,305).

Fig 3: Plot of discriminant function scores for regular maintenance level

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However, the classification functions thereafter calculated, still lead to

misclassification of about 20% of the initial observations. This can be attributed to
the fact that several data values significantly diverge from the pattern. However,
such divergences are expected to occur up to a certain degree since site data
involve significant uncertainty emerging from the human error or subjectivity, as
well as other unpredictable factors.

6. Conclusions

This research aims at improving the management of earthmoving equipment;

focuses on the implementation of a condition prediction model that has successfully
been applied to means of Public Transportation. The model exploits data provided
by two Greek construction companies and concern 126 earthmoving trucks. The
first objective is to employ discriminant analysis to find amongst the available
characteristics of the trucks (capacity, age, kilometers, maintenance level) those
that best separate them as far as the different condition levels are concerned. The
model recognizes by far the maintenance level as the most significant factor for the
condition of the truck. However, this is mainly due to the considerably variable
effectiveness of the different maintenance policies applied to the sample trucks:
according to the one of the policies, the truck undergoes extensive component
replacement upon each project’s completion. This eliminates the impact of the
other characteristics (capacity, age, kilometers) and thus prevents their correlation
with the trucks’ condition. Therefore, the model is not allowed to provide a
sufficiently reliable classification of new trucks. The model’s performance improves
under the consideration of a common maintenance level, verifying the fact that its
importance and effectiveness is strongly dependent on the maintenance policy
applied.

7. References

Adedimila, A.S., Olutaiwo, A.O. and Kehinde, O. (2009), “Markovian Probabilistic

Pavement Performance Prediction Models for a developing country”, Journal of
Engineering and Applied Sciences, 4(1), 13-26.
Baik, H.-S., Jeong, H.S. and Abraham, D.M. (2006), “Estimating Transition
Probabilities in Markov Chain-Based Deterioration Models for Management of
Wastewater Systems”, Journal of Water Resources Planning and Management,
132 (1), 15-24.
Bulusu, S. and Sinha K.C. (1997), “Comparison of methodologies to predict bridge
deterioration”, Transportation Research Record, 1597, 34-42.
Chang, J. and Collura, J. (1997), “Integrating public transportation facilities and
equipment management systems into capital improvement planning process”
Transportation Research Record, 1618, 96-102.
Enright, M.P. and Frangopol, D.M. (1998), “Service-life prediction of deteriorating
concrete bridges” Journal of Structural Engineering, 124 (3), 309-317.
Frangopol, D.M., Kong, J.S. and Gharaibeh, E.S. (2001), “Reliability-based Life-
Cycle Management of Highway Bridges”, Journal of Computing in Civil
Engineering, 15 (1), 27-34.
Jiang, Y. and Sinha, K.C. (1994), “Simulation approach to prediction of highway
structure conditions”, Transportation Research Record, 1347,11-17.
Karlaftis, M.G. (1997), “A comparison of pattern recognition and probabilistic
techniques for capital asset deterioration”, Journal of Public Transportation,
1(3), 87-103.
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Karlaftis, M.G. and Sinha, K.C. (1997), “Modeling approach for transit rolling-stock
deterioration prediction”, Journal of Transportation Engineering, 123(3), 223-
228.
Kong, J.S. and Frangopol, D.M. (2004), “Prediction of reliability and cost profiles of
deteriorating bridges under time- and performance- controlled maintenance”,
Journal of Structural Engineering, 130 (12), 1865-1874.
Ludwig A. (1997), “Systems planning for capital asset management: a case study
of the New - Jersey public transportation facilities and equipment management
systems”, Transportation Research Record, 1604, 109-117.
Morcous, G. and Lounis, Z (2006), “Integration of stochastic deterioration models
with multicriteria decision theory for optimizing maintenance of bridge decks”,
Canadian Journal of Civil Engineering, 33 (6), 756-765.
Sawicki, P. and Żak, J (2007), “Technical diagnostic of a fleet of vehicles using
rough set theory”, European Journal of Operational Research, 193, 891-903.
Tran, D.H., A.W.M., Ng and Perera, B.J.C. (2007), “Neural networks deterioration
models for serviceability condition of buried stormwater pipes”, Engineering
Applications of Artificial Intelligence, 20, 1144-1151.
Yu, J. Chou, E.Y.J. and Luo, Z. (2007), “Development of linear mixed effects
models for predicting individual pavement conditions”, Journal of
Transportation Engineering, 133 (6), 347-354.
Zhao, Z. and Chen, C. (2002), “A fuzzy system for concrete bridge deck damage
diagnosis”, Computers and Structures, 80, 629-641.

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SPM02
An Integrated Approach to Monitoring/Performance Assessment of
Operational Programmes Co-financed by the European Union

Panagiotis Markoulidis,
(Managing Director, OMIKRON5 Ltd, Athens, Greece)

Aggelos Koutsomichalis,
(General Director, EEO Group, Athens, Greece)

Konstantinos Kloudas,
(Director, Enoros Consulting Ltd, Nicosia, Cyprus)

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AA075
A new approach to assessing Malaysian contractor satisfaction levels

Md Asrul Nasid Masrom

(PhD Student, School of Urban Development, Queensland University of Technology,
Brisbane, Australia)

Martin Skitmore
(Professor, School of Urban Development, Queensland University of Technology,
Brisbane, Australia)

Abstract
The extent of poor project outcomes is a recurring issue for construction industries
worldwide. One of the main causes of these and project failure seems to be the
inability of contractors to provide a high level of service quality to the project team.
In Malaysia, design failures have also been identified as a further contributory
factor.

To overcome this, different types of subjective performance measurement have

been progressively developed. These approaches are typically concerned with client
satisfaction, customer satisfaction, home buyer satisfaction and occupant
satisfaction, but very seldom consider contractor satisfaction.

This paper examines the implications of this, and what is involved in developing
satisfaction measures based on contractor perception instead of the typical sole
concern with client performance. As a result, other attributes such as participants’
performance, business performance, project performance, external factors and
contractor characteristics are also examined. Several potential attributes are
derived from interviews among Malaysian contractors, namely: performance (direct
attributes) and contractor characteristics (indirect attributes) that possibly influence
contractor satisfaction levels. These attributes are then developed to improve the
existing conceptual framework.

The developed framework is expected to help the project team in performing

projects more efficiently, maintaining service quality and improving relationships
between participants. In addition, the findings of the paper should assist
contractors enhance competitiveness, improve their image and create more job
opportunities in the future.

Keywords
Attributes, contractor satisfaction, framework, measurement, performance,
projects.

1. Introduction

The performance of the construction industry is of some cause for concern

throughout the world. This seems to be mainly due to substandard construction
work of contractors and the absence of a high service quality from contractors is
widely recognised as an important influential factor. In Malaysia, however, although
the issue of contractor service quality is still important, design failures have been
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found to be the main cause of problems. In response to this, it is argued, an

effective attempt is needed to determine the contributory factors involved and
develop diverse types of performance measurement.

There are two basic approaches to measuring the level of performance in the
construction industry - objective measurement (time and cost) and subjective
measurement (quality and satisfaction). Objective measurement, also known as the
iron triangle has extensively been used. However, this has some limitations. For
example, it is ineffective for large development projects and where there is a
diverse group of participants (Toor and Ogunlana, 2009). To alleviate this,
subjective indicators such as satisfaction measures have been used to enhance
existing objective methods and project outcomes.

Satisfaction measurement and measures (SM) are derived from perceptions,

services and values, and have received great attention in performance studies
involving several disciplines, such as marketing, business and psychology. SM has
also been used in the construction industry to gauge service quality. Although
contractor satisfaction (Co-S) is one of the best indicators of construction project
performance measurement (Soetanto and Proverbs, 2002), it is seldom used in
practice. Additionally, existing studies on the attributes of Co-S are very limited as
they are purely concerned with client performance. Accordingly, this study is
focused on determining the potential attributes of Co-S and the development of a
contractor satisfaction (Co-S) conceptual model or framework appropriate for
construction projects.

2. Previous studies of SM in construction

In recent years, subjective measurement has been conducted in the construction

field to improve construction performance in terms of level of product and service
delivery. A number of methods and tools exist to evaluate the satisfaction levels of
participants involved in construction projects. Previous work on performance
measurement based on SM is dominated by client satisfaction (Cl-S), customer
satisfaction (Cu-S), home-buyer satisfaction (Ho-S) and occupant satisfaction (Oc-
S). This suggests that SM is an efficient indicator in demonstrating performance
levels. To establish performance standards necessitates a paradigmic shift of the
construction industry from a product-oriented culture to a service–oriented culture.
This is also thought to be important in improving construction project quality. As
Soetanto and Proverbs (2004) emphasize, satisfaction and performance are
interrelated in determining the level of performance outcomes. The different
perspectives of the roles of SM and the attributes involved are explained in the
following discussion.

Arditi and Lee (2003) acknowledge that the performance of project outcomes could
be measured in terms of client perceptions. Cl-S measurement is important to
determine the performance levels of other parties, such as consultants and
contractors. However, Cl-S levels can be different from one client to another as
each client perceives service quality in his/her own unique way based on the

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cumulative memory of many experiences. Cheng et al., (2006) also emphasize

that client characteristics, including sector, size or location, may have a significant
impact on Cl-S levels.

Studies of SM concerning the client/customer’s perspective have been the most

popular among researchers from a variety of disciplines. Cu-S, for example, has
been developed to investigate customer perceptions of facilities management
services (Tucker and Pitt, 2009). This means that satisfaction is not only limited to
measure the quality of the end product but it seems also to be an adequate process
in identifying service quality levels. In the construction industry, Cu-S is widely
used to improve participant relationships, with increased understanding and
enhanced cooperation among the participants. However, Cu-S could possibly be
influenced by the several expectation factors, including past experience, their own
personnel needs, image of the contractor, their own investment and relationships
(Karna et.al, 2009).

In a different perspective, several empirical studies emphasize the satisfaction of

home buyers and occupants. Ho-S and Oc-S are important in demonstrating the
project team’s performance level. Torbica and Ricoh (2001) stress that Ho-S is not
only influenced by product design or product quality, but other home buyer
characteristics such as experience, income, age, knowledge and location. To
investigate the level of Ho-S, an instrument called HOMBSAT was developed,
comprising the three dimensions of design quality, house quality and service. On
the other hand, Oc-S has been introduced to determine the inappropriateness of
design and performance of the building. This method can be conducted during the
design stage (in the form of value engineering) as well as after completion of the
building.

3. Study gap

According to the earlier discussion, SM is becoming a prominent approach to

improving service and product delivery of construction projects (Chan, 2009). SM
can provide several benefits, as it is a comprehensive way to create differentiation
among the competitors, increase the level of service, improve the quality of the end
product, gauge business performance, sustain business in the market place,
increase the opportunities for repeat business with stakeholders, and enhance
image and company reputation. Project performance measurement based on
satisfaction levels could be made more effective by considering all project
participants including the contractor. Soetanto and Proverbs (2002) have suggested
that SM from a contractor perspective is an ideal assessment by which to increase
the quality of projects. However, the evaluation of Co-S is still not extensively
conducted. Therefore, there is a need to improve the existing Co-S model. The
following discussion focuses on the development of a Co-S framework by including
other significant elements that are not fully explained in previous studies.

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4. Research methodology

According to the issues highlighted above, this study aims to identify the main
attributes of Co-S for incorporation into a preliminary conceptual framework. The
main attributes are derived from an extensive review of the literature and
preliminary interviews. The framework was developed by combining two elements,
i) performance attributes and ii) contractor characteristics. The development of the
Co-S framework is important in order to refine the existing model.

Several attributes were obtained by consulting previous studies. As Chen et. al

(2009) point out, exploring the literature avoids duplicating work, identifies
previous work in the same fields and helps attain some ideas and information that
may suitable for the study. To establish a comprehensive Co-S model, face-to-face
preliminary interviews were conducted with contractor personnel registered under
the Malaysian Construction Industry Development Board (CIDB). The objective of
the interviews was to identify additional information and specify problems not
identified in previous work. Additionally, the interviews were important to address
the participants’ understanding of the problems and issues involved in the study
(Cheng et.al, 2006). Six different grades of Malaysian contractors were selected at
random for participation in the open-ended interviews. The findings were employed
in the development of the preliminary conceptual Co-S framework.

5. Research findings and discussions

The previous literature on performance measurement indicated that project

outcomes, profitability and productivity can be improved by having an effective
satisfaction evaluation method. In this regards, the development of a unique Co-S
model and identification on interaction between Co-S attributes are discussed in the
next section.

5.1 Potential attributes pertinent to Malaysian contractor

satisfaction levels

This study begins by identifying the attributes for measuring Co-S. To attain a
better understanding, this section provides a detailed discussion on the attributes
includes performance attributes (direct attributor) and contractor characteristics
(indirect attributor) as depicted in Figure 1.
Performance Attributes (Direct Attributors) Contractor Characteristics
(Indirect Attributors)
Participant performance
 Experience of the Legend:
contractor Direct  
Project performance Indirect
 Knowledge
 Size
Business performance  Culture Degree of Co-S
Satisfaction/
External factors Dissatisfaction

Figure 2: Proposed conceptual framework of Co-S measurement

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5.1.1 Performance attributes

The outcome of the research to date shows that Co-S levels depend on
methodologies, and perspectives and attributes have been selected to measure
degree of satisfaction. Four indicators of performance attributes were derived
namely: i) participants’ performance; ii) project performance; iii) business
performance; and iv) external factors (comprising project related factors, project
procedures and the external environment). The following discussion describes each
Co-S attribute in detail.

This paper proposes an enhancement by integrating three elements, namely service

delivery, relationships of people/participants and communications. Service delivery
consists of items relating to products and/or services performed by the participants
(such as clients, consultants, subcontractors and suppliers). Butcher and Sheehan
(2010) assert that an excellent performance evaluation of the overall perspectives
leads to a longer term improvement of performance levels. Additionally, trust has
been identified as one of the important factors to improve relationships among
participants (Smyth et. al, 2010). One of the interviewees also emphasized
communication as another item for evaluating the service quality of participants.
Effective communication is needed to improve project team relationships as it
influences participant satisfaction (Leung et al. 2004). This shows that service
quality is not only based on service delivery but relationships of participants and
communications between project team also need to be taken into account in
developing a Co-S framework.

Project performance is often used as a major indicator in performance

measurement studies. Construction projects are commonly acknowledged as
successful when timely completed, within budget, conform to specification and
satisfy stakeholders. To determine the appropriate Co-S attributes, this study
proposes other attributes: functionality; profitability; absence of claims and fitness
for purpose. However, five additional performance measures have been identified
as applicable to contractors: cost performance; time performance; quality
performance; owner satisfaction; and profit margin (Ling et al., 2008). As the
interviewees emphasized in the interviews, these attributes are important for
contractors to maintain their performance.

Business performance is another important element in measuring Co-S levels.

Commonly, contractor performance is judged by cost, time and quality alone.
However, some previous studies argue that contractor performance should be
extended to include the continued activity of contractors, as measured by their
profitability, investment in research and development, harmonious working
relations throughout projects, environmental protection and safety. Furthermore,
business performance also depends on the resources and capabilities of the
construction company, its project management competencies, the strengths of its
relationships between project team members and the strategies of the company.

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Another key attribute that influences Co-S levels is external factors. Project
characteristics and the transparency of government procedures on contractor
selection are considered to be among the important external factors influencing Co-
S. Having good connections (guanxi) between the contractor and the client are still
essential for the successful procurement of projects in many countries (Ling et al.,
2005). In addition, the environmental issues of: economic environment; social
environment; political environment; physical environment; industrial relationships
environment; technology advance have a potential influence on Co-S levels.

5.1.2 Contractor characteristics

The impact of indirect attributes or contractor characteristics are important to

examine the degree of Co-S levels. Informed by the literature and the preliminary
interviews results, the four indirect attributes of contractor’s experience,
knowledge, size and culture, were found to be necessary to taken into
consideration.

The contractor’s experience is an important criterion for evaluating the performance

of the contractor which may influence Co-S levels. The contractor’s experience is
commonly determined by the number of years working in construction. Pemsel et
al. (2009) assert that experience from previous projects influence the expectation
of the final outcome. However, the contractor’s expectations also affect the decision
as they are based on perceived service performance. The expectation or standard
of experience of a contractor could be determined by the contractor’s familiarity
with the market, understanding of regulations and technical and management
skills. The result indicates that, to evaluate Co-S levels, it is important to consider
experience in terms of the total work volume on similar projects, the average work
volume on similar projects, experience of contract types and teams, working in
similar geographical conditions and working in similar weather conditions on similar
projects.

Another characteristic that impacts on Co-S is knowledge. Currently, most projects

require a high level of skills in terms of technology, material and safety, thus the
contractor’s personnel need to have sufficient basic knowledge in these areas.
Interviews results indicate that an effective and knowledgeable contractor is
necessary to ensure the work is delivered according to the work programme,
standards of requirements and specified level of quality. Know-how knowledge is
important but hardly to be shared as it acquired through learned behaviour. The
relationship between this knowledge and Co-S can be derived as the contractor has
different levels of expectation from which judge performance.

In construction, contractors can be distinguished according to several sizes - such

as small, medium and large - and based on their capital and financial capabilities.
Additionally, this includes organizational structure, current workload, technical
personnel and management capability. Larger contractors have different
expectations than small or medium size contractors. Although several direct
attributors influence performance measurement based on Co-S levels, the literature

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and the interviews results show that characteristics such as the contractor size
indirectly impact on the degree of Co-S. For example, larger size contractors have
different needs, as they are as concerned as much with their reputation as with
profit.

In construction, culture is concerned with the impact of a nation’s culture on

construction management. Additionally, culture in project management also has
been investigated by Bredillet et.al (2010). Every organization practices different
systems, arrangements and procedures. Co-S levels could be affected by culture
as it relates to motivation, efforts to innovate, incentives offered and
implementation of new technology. Additionally, the construction industry currently
emphasizes environmental issues and innovation as there are several important
requirements that need to be fulfilled.

6. Conclusions

An integrated framework of Co-S levels is proposed as shown in Figure 1. This

integrates the two main attributes (direct attributes and indirect attributes) that
have been discussed in the previous section. The paper demonstrates these two
highlighted components to measure performance, namely: (1) direct attributes also
known as performance attributes that consist of several elements such as
participants’ performance (service quality), project performance, and business
performance and external factors; (2) indirect attributes also known as contractor
characteristics that comprises several elements including knowledge, size of the
organization, experience and culture. The model established is likely to be beneficial
to contractors in enhancing and maintaining their level of business as well as
improving project performance. Additionally, the proposed Co-S framework may be
able to motivate clients, consultants and other participants to enhance their service
and product quality, compete in the market place, eliminate claims and disputes,
and increase their trust in the contractor’s capability.

7. References

Arditi, D and Lee, D. E. (2003), “Assessing the corporate service quality

performance of design-build contractors using quality function deployment”,
Construction Management and Economics, 21, 175-185.
Bredillet, C., Yatim, F. and Ruiz, P. (2010), “Project management deployment: The
role of cultural factors”, International Journal of Project Management, 28, 183-
193.
Butcher, D. C. A. and Sheehan, M. J. (2010), “Excellent contractor performance in
the UK construction industry”, Engineering, Construction and Architectural
Management, 17(1), 35-45.
Chan, T. K. (2009), “Measuring performance of the Malaysian construction
industry”, Construction management and Economics, 27, 1231-1244.
Chen, W. T., Liao, S. L. and Mortis, L. (2009), “Evaluating satisfaction with PCM
services for school construction: A case study of primary school projects”,
International Journal of Project Management.

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Cheng, J., Proverbs, D. G. and Oduoza, C. F. (2006), “The satisfaction levels of UK

construction clients based on the performance of consultants”, Engineering,
Construction and Architectural Management, 13 (6), 567-583.
Karna, S. (2004), “Classifying and clustering construction projects by customer
satisfaction”, Facilities, 27 (9-10), 387-398.
Leung, M.Y., Ng, T. and Cheung, S. O. (2004), “Measuring construction project
participant satisfaction”, Journal of Construction Management and Economics,
22, 319-331.
Ling, F. Y. Y., Ibbs, C. W. and Kumaraswamy, M. M. (2005), “Enablers that help
foreign architectural, engineering, and construction firms win construction
contract in China”, Journal of Management in Engineering, 12(2).
Ling, F. Y. Y., Low, S. P. Wang, S. and Egbelakin, T. (2008), “Models for predicting
project performance in China in using project management practices adopted by
foreign AEC firms”, Journal of Construction Engineering and Management,
134(12).
Pemsel, S., Widen, K. and Hansson B. (2010), “Managing the needs of end-users in
the design and delivery of construction projects”, Facilities, 28(1/2), 17-30.
Smyth, H., Gustafsson, M. and Ganskau, E. (2010), “The value of trust in project
business”, International Journal of Project Management, 28, 117-129.
Soetanto, R and Provers, D. G. (2002), “Modelling the satisfaction of contractors:
the impact of client performance”, Engineering, Construction and Architectural
Management, 5(6), 453-465.
Soetanto, R and Provers, D. G. (2004), “Intelligent models for predicting levels of
client satisfaction,” Construction Research, 5(2), 233-253.
Tucker, M. and Pitt, M. (2009), “National standards of customer satisfaction in
facilities management”, Facilities, 27 (13/14), 497-514.
Torbica, Z. M. and Stroh, R.C. (2001), “Customer satisfaction in home building”,
Journal of Construction Engineering and Management, 127(1), 82-86.
Toor, S.R. and Ogunlana, S. O. (2009), “Beyond the ‘iron triangle’: Stakeholder
perception of key performance indicators (KPIs) for large-scale project sector
development projects”, International Journal of Project Management, 28, 228-
236.

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AA111
Low Energy And Passive Housing Standards In Europe

Vjeran Mlinarić
(Professor, Faculty of Civil Engineering, University of Zagreb, Zagreb, Croatia)

Zvonko Sigmund
(T.A., Faculty of Civil Engineering, University of Zagreb, Zagreb, Croatia)

Sandra Trojak
(Executive editor, Magazine”Construction, Installations, Equipment and Energy of
the 21st Century“, Zagreb, Croatia)

Abstract
Implementation of building energy ratio for new buildings resulted with a need to
establish standards and certificates suitable for different building codes,
geographical locations and building traditions of a specific nation or region. For
Europe most highlighted energy rating indexes are “EPBD” (“Energy Performance of
Building Directive”), with British version “BER” (“Building Energy Rating”), German
“Energie-Pass” and Swiss “Minergie®”, as well as for USA “LEED”. Also well known
are standards for extremely low energy buildings as “PassivHaus”, “Minergie®P-
Eco”, “Zero Energy” and “klima:aktiv”.
By the directive of the European Union all the buildings on the market that are
being built, sold, or rented need to be certified. Gained certificate and annual
energy consumption data could be presented to anyone interested, which will
intensively affect the market.
This article is presenting different energy rating certificates with specific energy
consumption data which enables the energy consumption comparison of different
buildings. The article also presents the comparison of low energy building standards
as: “PassivHaus”, “Minergie®” and “LEED”.

Keywords
low energy housing, passive housing, standards, certificate, certificate comparison

1. Introduction

Inducing the obligation of certifying the energy performance of the buildings

resulted with establishing different standards and certificates which are customized
according to different laws, geographic location, and building tradition of a specific
region and a nation. Specially these certificates are worth mentioning: EPBD
(Energy Performance of Buildings Directive), with it's versions like British BER
(Building Energy Rating) and German Energie-Pass, but also American LEED, Swiss
Minergie®, with their well known standards for very low energy buildings like
PassivHaus, Minergie®P-Eco, Zero Energy and klima:aktiv.
By the directive from EU all the buildings that are built, sold or rented will be
certified, and the data of annual energy consumption for heating will be provided or
can be seen by all interested customers, which could have a major impact on the
community and the market.

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2. Comparison of needed conditions for very low energy

consumption buildings in different EU countries

The assumptions and basics for energy consumption are different and therefore the
comparison of required energy performance is not possible. For instance energy
performance can be calculated by the area of heated floor, or by the populated
area, or by the big floor area and these can vary 10 to 20%. Furthermore, which
energy consumption processes are included in calculations of energy performance
also makes a difference. Table 1. shows the limit consumption for several countries
which have these regulations.

Country Very low energy building limitations

Austria Low energy buildings are usually those buildings with heating
energy consumption below 60-40 kWh/m2 of the total area (larger
numbers for single family housing). Standard passive houses with
15kWh/m2 are defined by the usable area in Styria and by heated
area in Tirol.
Denmark Temporary building regulative defines two different low energy
consumption (LOC) classes. LOC class 1 and LOC class 2 are
defined by the energy performance calculations which are 25 or
50% lower than the maximum obligatory for new buildings.
Minimum energy consumption that is requested for new residential
buildings is 70 + 2200/A kWh/m2 annually (where A defines total
heated floor area). For the other the minimum energy consumption
request is 95 + 2200/A kWh/m2 annually. Minimum energy
consumption for the non residential buildings includes lighting.
France Since May 8th 2007. "Arraté ministeriel” is defining requests for
energy consumption of buildings. These regulations have five
building types: HPE, HPE EnR, THPE, THPE EnR, BBC and “Low
consumption building”.
BBC requests:
New buildings: annual energy consumption for heating, cooking,
airing, warm water and illumination have to be lower than 50
kWh/m2 (40 – 60 kWh/m2 depending on climate and height over
the see level). For other new buildings: annual energy consumption
for heating, cooking, airing, warm water and illumination need to
be at least 50% lower than the temporary building regulation
proscribes.

Germany Minimal energy consumption performance for a new residential

building are defined and calculated by:
50,94 + 75,29*(A/Ve)+[2600/(100+An)] kWh/m2
where A defines the outer area of insulation, Ve is the volume
surrounded by the insulation and An defines the usable area.
Public definitions which are meant for public support for low energy
buildings are in suborder of state (Kreditanstalt für Wiederaufbau,
Frankfurt (KfW)). These programs are mostly financed from public
monetary funds. Temporary energy limit is 60% (KfW60) (request
for primary energy is limited at 40 kWh/(m2a), but the insulation of
the buildings are 45% better than EnE level).
Besides that there is a financial aid program for “Passiv-Haus”
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buildings, which is defined by the Passiv-Haus-Institut as KfW40

with annual energy consumption lower than 15 kWh/m2.
Swiss Some cantons include “Minergie®” as their regulations for new
buildings: Minerge (38 kWh/m2). Energy consumption includes
heating, warm water and ventilation. Additional electricity
consumers need to satisfy some criteria.
United Indices show that regulations are going to proscribe next: at 2010
Kingdom level 3 (25% better than the contemporary regulations); 2013 level
6 (zero carbon for all the consumed energy – including the
additional energy consumers)

Table 1: Low energy consumption building definitions

3. Comparison of different national standards for low energy

buildings

Several countries have developed standards and design processes in order to

standardize, control and promote best low energy building practices. These three
standards will be analyzed: German PassivHaus, Swiss Minergie® and American
LEED.

3.1. PassivHaus

Passive house institute (Passiv-Haus-Institut – PHI) in Darmstadt is intensively

orientated towards studying energy characteristics of buildings. “PassivHaus”
certificate means that the building complies with the requests for low energy
building of PHI. Technical definition of that certificate is quite clear when speaking
of climate for buildings between 40° and 60° northern geographical longitude. Or
more precisely, a house can get a “PassivHaus” certificate if it complies with next
criteria:
1. Comfortable inner climate can be preserved without using the central heating
or cooling systems. Annual energy consumption for heating needs to be
designed in that way that it doesn’t rise above 15 kWh/m2.

2. The comfort criteria needs to be preserved in all rooms of the building as

during the winter as during the summer. With those aims, certificate requests
very precise levels of insulation for every construction element:

a. Lost heat ratio for all cross sections needs to be lower than 0,15 W/m2K

b. Every window and outer door needs to be with U-value lower than 0,8
W/m2K, as well as precisely defined window areas. The windows need to
be at least with double isolation glass (triple isolation glass is
recommended) with high thermal quality and good /BRTVLJENJE/

c. Air exchange per hour needs to be less than 0,6; Depending on the
orientation and the building construction strong limitations are prescribed
for each transparent element, regarding the orientation and a possibility to
open. Ventilation openings are strictly controlled.

d. Ventilation and recuperator in passive houses are obligatory.

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Qsum = (Qtrans + Qvent) – Qgain < 15 kWh /m2 annually

3. Total primary energy consumption for all home appliances, sanitary water,
heating and cooling of the area does not exceed 120 kWh/m2. This design is
included in the project planning.

Fig. 1: PassivHaus certificate

After all works have been finalized each building is checked for the achieved
properties especially all the seals are being checked. PassivHaus institute also
certifies building elements as doors, windows, wall elements, etc. This process
guaranties that after a new construction has been finished all the elements really
comply with building requirements. Since the 80’s, when the concept was founded,
up to these days there are over 6000 projects finished in Germany, 1500 in Austria
and about 300 in Benelux.

3.2. Minergie®

Fig. 2: Minergie® certificate

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The Minergie certificate is temporarily available only in Swiss and Liechtenstein.

Minergie certificate is conceptually very close to the PassivHous. It defines very
precise levels of energy consumption, and especially the Minergie-P® version.
Minergie is a certificate that is appropriate for every type of buildings (residential
buildings, hospitals, industrial buildings, etc.). There are two ways how to get a
Minergie certificate. The first one is to use standard solutions that are usable only in
single house projects. Those solutions cover three points:
1. Very precise insulation values for each construction element

Construction element Values if in contact Values if in contact

with outer climate or if with non heated rooms
berried less than 2m or if berried more than
[W/m2K] 2m [W/m2K]
Roof, sealing 0,25
Wall 0,28
Floor 0,2 0,28
Heated floor 0,25
Windows 1,3 1,6
Doors 1,6 2,0

Table 2: Insulation standards requested for Minergie certificate

2. Choice between 5 technical solutions for heat production and distribution

Standard 1 2 3 4 5
solution
System Geothermal Boiler Automated Heating by Air heat
heat pump heated by heating waste pump
biomass system
+ solar using
water biomass
heater

Table 3: Available technical solutions for heating and warm water

Using all of these heating systems require double-flow heat exchanger with
minimum 80% energy efficiency.
3. Additional costs for using Minergie standard solutions may not exceed 10%
of conventional solution costs (15% by Minergie-P).

Second way of getting the Minergie certificate, which is also the only way for
residential buildings, is by examining the buildings performance. Those
performance tests are very detailed, and here are some specifications:
‐ Tests are different for private homes and for residential buildings

‐ Tests are different for new houses and for retrofitted houses

‐ Tests are customized to specific climate conditions (mostly height above see
level)

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Building Residenti Individu Office Hospital Industri Sport

type al al building s al building
buildings housing s building s
s
Maximal 42 42 40 75 20 25
values
[kWh/m2/
y]

Table 4: Some of the requests for Minergie certificate

Fig. 3: Minergie and Minergie-P standard differences

www.minergie.ch web page ahs announced that by the year 2007. 8200 buildings
have received Minergie certificate. Minegie-P certificate, or better known as
Minergie-Eco certificate is meant for buildings that use ecological building materials
and processes.

3.3. LEED

Fig. 4: LEED standard certificate

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LEED’s (Leadership in Energy and Environmental Design) Green Building Rating

System® is a voluntary national standard for high efficient building development.
The system was developed by American Green Building Council, which has designed
7 different certificates. Certificates relate to the type of the building: LEED-H for
houses, LEED-EB for existing buildings, etc. Certifying procedure is founded on a
whole list of criteria, which by far exceeds the limits of using the energy. These
certificates consider aspects such as energy transmission, visual design, use of local
materials, etc. LEED uses Energy Star sign for request of energy consumption in a
household. 15% decrease is proscribed in comparison with IECC (International
Energy Conservation Code) form 2006. These regulations are delicately coordinated
with the local climate and in accordance with that they define constructive elements
and techniques.
In order to certify a building some basic rules are a must. A bonus is included for
improved performance. Certificate is given in 4 different forms: certified, silver,
gold and platinum. Although most of these building types have been constructed in
Northern America, there are some in Europe as well.
Since LEED is including not only low energy consumption, but also the whole
process of construction, activities, and the expected live cycle of the building LEED
is a good example of a wider scope over civil engineering.

4. Conclusion

Because the energy consumption limitations differ from place to place according to
the climate and specific conditions and parameters, the simplest way to compare
various energy icons is to compare the technical requests, and especially the
requested insulation values. On the next picture there are several energy
consumptions requests compared.

Water Other Natural Transpor Inner Wat Educa

heating consum and local tation air er tion
ptions materials quality
PassivHa YES NO NO NO NO NO NO
us
Minergie YES Minergie Minergie- NO NO NO NO
® -P Eco
LEED YES YES YES YES YES YES YES

Table 5: Comparison of observation areas for 3 standards

Most of the aspects in the Table 3 have energy values. Transportation is a good
example: building a low energy home is useless if that requires increase in vehicle
energy consumption. A certificate is available only by tests performed by the
authorized institute, which can, but doesn’t need to be, locally active. However,
criteria and the evaluation of those low energy consumption buildings can serve as
an inspiration and a guideline for every project.

5. References

Feist, W., Pflüger, R., Kaufmann, B., Schnieders, J., Kah, O., (2004) “Passive House
Planning”

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Standards:
Passive House Standards
ISO 13790:2008 – Energy performance of buildings – calculation of energy use for
space heating and cooling
EN 15217:2007 – Energy performance of buildings – Methods for expressing energy
performance and for energy certification of buildings
Internet:
CEPHEUS – http://www.cepheus.de
PassivHaus Standard: Passiv-Haus-Institut - http://www.passiv.de
Minergie® - http://www.minergie.ch
LEED standards - http://www.usgbc.org/leed
Klima:aktiv standards - http://www.klima:aktiv.at

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PRC1

Modelling with uncertainty for control tasks

A.J. Moutsopoulou
(Lecturer, Department of Civil Engineering, Technological Educational Istitute of
Crete, Greece)

G.E. Stavroulakis
(Professor, Department of Production Engineering and Management, Technical
University of Crete, Greece)

A.T. Pouliezos
(Professor, Department of Production Engineering and Management, Technical
University of Crete, Chania, Greece)

Abstract
This study presents appropriate methods for control modelling with uncertainty for
the analysis of management activities and the certification that they meet the
performance standards. Dealing with and understanding the effects of uncertainty
are important tasks for the project controlling. Reducing the effects of some forms
of uncertainty (initial conditions, low-frequency disturbances) without
catastrophically increasing the effects of other dominant forms (sensor noise, model
uncertainty) is the primary job of the feedback control system. Closed-loop stability
is the way to deal with the (always present) uncertainty in initial conditions or
arbitrarily small disturbance. This paper outlines the methods available in the
control theory and their applicability on management systems

Keywords
Project management, uncertainty modeling, optimal control, dynamical systems

1. Introduction

Control is the process in management that allows measurement of the realized

results and their comparison with the target performance standards in order to
validate the attainment of the program goals or to find divergence and initiate
cause-based corrective actions. By setting the goals and ensuring the resources to
meet them, a successful system of feedback for the desired results is created.

Control in this study is presented as a process that includes four stages 1. Setting
the standards and goals. 2. Measuring the realized performance. 3. Comparing the
realized results with the standards. 4. Taking corrective actions. The goal is the
nominal and robust performance of a system. Specifically for the nominal
performance, the performance index stability of the organization and the small size
of operational errors are required. For the robust performance, all the criteria of the
nominal performance should apply, despite all modelling errors and the uncertainty
of conditions. A two port diagram is presented, under conditions of uncertainty, for
the control modelling of the organizations.

The use of these models is of significant importance for the operation of an

organization, as it facilitates the control of production effectiveness, the control of
the organization structure as well as the control and evaluation of the services
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provided to the company’s customers. This paper demonstrates the applicability of

control modelling with uncertainty for the analysis of management activities.

2. The control process

The rationale of the “governmental” control system is expressed in control through

the following steps:

2.1 Definition of goals and standards

The goals and standards are set, normally, during design. They are, by definition,
performance criteria. They are selected points in the whole design system, where
performance (and not only) measurements are elaborated, so that the managers
receive “signals” as to how things proceed and they are not obligated to follow
every step of the execution of the designs and programs.

The selected points for control should be critical, in comparison to other factors,
whether the designs application is evolving well. The standards are of various
types, such as for example:

- Natural: they are non-monetary, usually referring to a productive, functional

level, such as man-hours per production unit, production quantity, quantity of
consumed fuel per, unit of product, etc.

- Cost: here monetary values of expenses are connected to activities or

produced products, such as the expected per unit cost of a meal that is offered in
the airplane of a flight company

- Capital: this has to do with the invested capital and in terms of accounting it
is related to the balance sheet of a company. An example here is the amount of
invested capital per resident of an area from the cleaning service of this area.
- Revenues: they are monetary values referring to the sales, such as the
revenues per visitor of an amusement park.

- Intangible standards: such can be the company’s profile, the consumers’

attitudes, the level of public relations, the employees’ morale etc.

Nevertheless, the type and form of these standards depends on the area of control
of the company. This topic is further developed below.

2.2 Measurement of the true performance

“Feedback” is necessary for the measurement of the performance or other company

variable. This is often done through written reports, as we mentioned before. Other
ways of information are, as we noted, personal observation and oral reports. In
addition, the statistical reports are more and more being adopted lately, which
contain, among others, graphs of various types and tables through which the
managers evaluate better the performance of the company, of the departments and
the people.

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2.3 Comparison of the true results to the standards

Here is defined the degree of divergence between true performance and standards.
Some divergence between reality and standards is usually acceptable. Therefore,
the important is to set the accepted range of divergence.

2.4 Undertaking a corrective action

Usually at this stage there are three alternative choices. To leave things as they are
(do nothing), to correct the true performance or to redefine the standards. At this
stage of control and particularly in the two last choices, the exercise of the other
functions of management is introduced again and as a result, control takes a
dynamic and continuous character.

3. Types and areas of control

The administration of the company is likely to exert control before starting some
activity, during the activity and when it finishes. The first type of control, the
preliminary or feed forward control, aims to ensure that the appropriate
directions are given and the necessary resources are available for realizing the
activities. The preliminary controls are designed so that the company is ready for
the case that potential problems appear. So when there are indications that
problems appear, the appropriate preventive actions are adopted. Therefore, the
company foresees and takes into account the changes in its environment and
adjusts accordingly its control systems. An example of such a control type could
refer to the preparation of a company producing detergents to convert its products
to ecological ones, when it has substantial information that a change in the current
relevant legislation is about to happen, which will impose ecological standards to
the detergents. This means that in the preliminary design, the company aims to
prevent the appearance of problems rather than cure them after they appear.
However, this type of control requires early and concise information, which is often
very hard to get. In any case, this type of control, if we see it from another
perspective, is, we would say, a proper design.

The second type of control, the concurrent control, takes place when an activity
is in progress. In this case the administration of the company has the opportunity
to correct a problem before this becomes too expensive for the company. The direct
supervision of the staff is such a type of control.

The third type of control, the feedback control, is performed when an activity or a
task has finished. It focuses on the final results. It is the most wide-spread and
popular type of control. An example of this type is when the customer of a
restaurant is asked, after he eats the meal, whether he liked it. The main
disadvantage of this type is that the manager receives the information about a
problem that possibly occurred, after the damage has taken place. (Miara et all.
(2007)).

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4. The feedback control as a process for the control of smart

management systems

A “smart” structure is one that monitors itself and its environment in order to
respond to changes in its conditions, (Tamer (2002)). The smart structure is made
of four basic physical elements: 1) a host structure, 2) an array of sensors 3) one
or more actuators, embedded or attached/installed on it, and 4) controllers. For
instance, in civil infrastructure a host structure may be a bridge, a highway, or a
dam that has to be monitored and controlled for safe performance of its intended
use. The main types of controlling and supervising constructions are the following:
the simple surface control, which is similar to the accelerated optical one, the
instrument control, and finally the control, which is based on ‘smart’ systems. The
efficient deployment of smart structures requires the employment of equally smart
management systems to operate them. Smart infrastructure system refers to the
combination of smart structures, (Tamer (2002)).

4.1 Smart management system

This criterion could be the most influential as it addresses the needed management
support to smart infrastructure system. It includes:

Product Modelling: In the case of Smart Systems (SS) a user organization needs
to adopt consistent presentation of SS physical components to achieve seamless
exchange of product data among manufacturers, suppliers, designers, permitting
agencies, owner, contractor, users, and facility managers. Product modelling
promises to achieve higher levels of performance in material management (in
contrast to outdated techniques being used to control traditional materials),
integrating vendor data into the design process, and facilitating design changes.
Such approach help realize an adequate level of the potential of SS through
integrating SS physical data in the procurement, design and operation processes
leading to optimized life cycle costing , (Tamer (2002)).

Process Modelling: This includes developing flexible process modules that assures
synchronized work flow within different departments and across different
organizations. Research is underway in different universities to investigate the
development of consistent standards for conducting and describing work process
[8]. Moreover, pioneering Virtual Design Team (VDT) analysis software are already
under development, (Levvit et all (1993)).

Organizational Modelling (Reengineering): This covers issues ranging from

structuring decision cycles to address SS needs, fostering cross-organizational data
exchange regarding SS, encouraging the deployment of SS, to threading SS
benefits and knowledge within an organizational culture. This includes addressing
how to design information flows within an organization to support effective SS
deployment, defining decision criteria that foster optimized life cycle costing of SS,
embracing open information exchange policies, fostering SS knowledge
preservation. Personnel quality: evaluates the readiness of company personnel to
adapt to the required change. This could include their competence in information
technology practice, technical backgrounds, quality of training programs, etc,
(Tamer (2002)).

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4.2 Design objectives and system specifications for smart

management systems

Design objectives fall into two categories (Pouliezos (2006)):

Nominal performance
1. Stability of closed loop system (plant+controller).
2. Disturbance attenuation with satisfactory transient characteristics
(overshoot, settling time).
3. Small control effort.

Robust performance
4. (1)-(3) above should be satisfied in the face of modelling errors.

System specifications

To obtain the required system specifications to meet the above objectives we need
to represent our system in the so-called (N, ∆) structure. To do this let us start
with the simple typical diagram of Fig. 0.1.

u
d
r=0
Κ x
G

y
n

Figure 0.1: Classical control block diagram

In this diagram there are two inputs, d and n, and two outputs, u and x, G is the
initial system and K is the controller. In what follows it is assumed that,

d u
 1, 1
n2 x2

If that is not the case, appropriate frequency-dependent weights can transform

original signals so that the transformed signals have this property.

Let us reorganize Fig 0.1 into Fig. 0.2:

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z
d

G
x

y
K

Figure 0.2: Detailed two-port diagram

or in the less detailed Fig.0.3,

w z

P
u

y
Κ

Figure 0.3: Two-port diagram

with,
u  d 
z   , w   
 x n 
where z are the output variables to be controlled, and w the exogenous inputs, K is
the controller and P is the controlling system.
Given that P has two inputs and two outputs it is, as usual, naturally partitioned as,

 z ( s )   Pzw ( s ) Pzu ( s )   w( s ) ορ  w( s )
 y ( s )   P ( s ) P ( s )  u( s )   P( s )  u( s )  (0.4)
   yw yu    
With the above equation we combine the inputs with the outputs, and we try to find
the transfer function Nzw(s).
Also,

u(s)=K(s)y(s) (0.5)

Substituting (0.5) in (0.4) gives the closed loop transfer function Nzw(s),

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Nzw(s)=Pzw(s)+Pzu(s)K(s)(I−Pyu(s)K(s))−1Pyw(s) (0.6)

To deduce robustness specifications a further diagram is needed, namely that of

Fig.0.4:

q ∆ p

w N z

Figure 0.4: N-∆ structure for uncertainty modelling

where N is defined by (0.6) and uncertainty modelled in ∆ satisfies ║∆║∞≤1

(details later). Here,

z=Φu(N, ∆)w=[N22+N21∆(I−N11∆)−1N12]w=Fw (0.7)

Given this structure we can state the following definitions:

Nominal stability (NS)  N internally stable

Nominal performance (NP)  ║N22(jω)║∞<1, ω and NS
Robust stability (RS)  F=Φu(N, ∆) stable ∆, ║∆║∞<1 and NS
Robust performance (RP)  ║F║∞<1, ∆, ║∆║∞<1 and NS

It has been proved that the following conditions hold in the case of block-diagonal
real or complex perturbations ∆:

Ι. The system is nominally stable if N is internally stable.

II. The system exhibits nominal performance if  N 22 ( j )  1
III. The system (N, ∆) is robustly stable if and only if,

sup Δ N11 ( j )   1 (0.8)



where μ∆ is the structured singular value of N given the structured uncertainty set
∆. This condition is known as the generalized small gain theorem.

IV. The system (N, ∆) exhibits robust performance if and only if,

sup Δ a N ( j )   1 (0.9)


where,

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Δ 0
Δa   p
 0 Δ 

and ∆p is full complex, has the same structure as ∆ and dimensions corresponding
to (w, z).

5. Conclusions

In this paper we make an effort of applying control theory with uncertainty, in

project management. Robust process control stands at a crossroad its ability to
impact the management engineering community imperilled by a number of issues
one of which is uncertainty modelling. A direction for robust project control lies in
the field of intelligent control which is qualitatively understood as the ability of a
control system to learn about its environment and process the information to
reduce uncertainty plan and execute control action in a safe and reliable manner.
Robust control theory and uncertainty modelling will only find life in the process and
management industries if they are successfully integrated into an intelligent control
system. This work has a profound effect on the future impact of modern robust
control theory on process control practice.

6. References

Tamer El-Tiraby, Khan Falahudin Kashif (2002), “Modes of application of smart

structures and system in construction”, First international conference on
Construction in the 21st Century, 25-26 April, 2002, Miami, Florida, USA.
Miara, Β. and Stavroulakis, G. and Valente, V. (Eds.) (2007), “Topics on
mathematics for smart systems”. Proceedings of the European Conference,
Rome, Italy, 26-28 October 2006, World Scientific Publishers, Singapore,
International.
Levvit, R.E. and Yan, J. and Gaye, O. and John, K. and Tore, C. (1993),
“Computational Enterprise Models”, Towards Analysis Tools for Designing
Organizations, in Coordination Theory and Collaboration Technology, New
Jersey, USA.
Pouliezos A. (2006), “H infinity control”, Class notes, http://pouliezos.dpem.tuc.gr

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AA014

The relationship between construction conflicts arising between oil

companies and poverty of host-communities in the Niger-delta
region of Nigeria

Charles Olatoye
(PhD Student, University of Manchester, Manchester, UK)

Abstract
The purpose of this paper is to examine the nature of project conflict between oil
companies and host-communities in which they operate in Nigeria’s oil-rich Delta
region, with a particular focus on the place of poverty in fuelling the lingering
conflict and the difficulty in curbing the conflictual situation. The method is
essentially a review of various available relevant literature and deductive
arguments that will give insights to whether poverty can be a catalyst to conflicts
between oil companies and host communities. The paper concludes that poverty of
host-communities to a project is usually at the heart of many project conflicts
arising between operating companies and host-communities. The paper usefully
points out the pervasive poverty in the Niger-delta region of Nigeria; and how
poverty has continued to ignite serious conflict among all stakeholders in the region
with grave consequences.

Keywords
Poverty, Violent conflict, Oil, Niger-delta.

1. Introduction

Conflicts, such as the kind that arise between oil host-communities and oil
exploration companies, have not traditionally been seen through an economic lens.
In the Nigeria's Niger-delta region, such conflicts are violent conflicts characterised
by the rise of armed rebel movements and militias. Their activities profoundly
disrupt oil production, and consequently, consumption, investment, taxation, and
provision of public facilities all suffer. Because manifest reasons for conflicts often
seem essentially non-economic (conflicts of values, self-determination, and justice),
a usual tendency has been to suspend economic analysis of a place or a process
when a conflict erupts, and resume analysis only after it stops. Starr M, (2006).

Yet the surge in violent conflict in the tail-end of the 20th century, poses questions
as to the connection between economic factors-poverty and conflict risks, especially
because many of the areas in which new conflicts were breaking out were in
economic decline, notably in sub-Saharan African states. Strand, H. et al,(2002).

Another problem is volatile oil prices. Revenue volatility hampers planning,

boosts deficits (when prices are high, it is easy to raise spending but hard to cut
back when prices fall, especially for governments whose legitimacy rests on
allocating oil rents) and tends to raise debt (when oil prices are high countries
are more creditworthy and tend to borrow more; when prices fall arrears build
up on irredeemable debts, increasing debt further). Volatility depresses economic
growth by increasing both interest rates (to compensate lenders for risks and costly
bankruptcies during crises) and uncertainty. Shaxson, N (2005). Productive
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industries are hurt during booms (typically through Dutch Disease effects or
increased interference by stronger governments), but not easily rebuilt during
busts. Financial crises can cause conflict and give powerful players opportunities at
the expense of smaller players. The economic and political conditions people in
non-oil sectors have in mind when signing contracts change when oil prices move,
creating reasons to renegotiate, so it is harder to follow rules, and this erodes
institutions. The list goes on. ‘Excess volatility is bad for growth, bad for
investment, and bad for the poor. Because the poor are typically less able to cope
with high volatility, volatility tends to increase poverty and worsen income
distribution,’ says Professor Ricardo Hausmann of Harvard University, a former
chair of the IMF–World Bank Development Committee. ‘There is convincing
evidence that excess volatility is bad for all the important dimensions of
development that we care about. Hausmann, R (2004).

In his investigation of the relationship between violent conflict and economic

decline, Collier ,et al.(2003), describes the central theme of his finding as ‘‘It’s the
economy stupid’’—that is, economic factors are central in all dimensions of violent
conflicts: poor economic policies predispose countries to conflict, economic
incentives cause armed rebellions to break out, economic factors sustain rebellions
and explain their durations, manipulation of economic incentives and resources is
essential for bringing conflicts to an end, and installing the right kinds of post-
conflict economic policies is vital for keeping the peace.

This paper examines some recent research on the economics of conflict. The
literature review shows how conflict is used to reinforce a neo-liberal view of
economic growth: war is said to result from poverty, and poverty from poor
economic governance, so that avoiding conflict or recovering from it requires
redoubled efforts to liberalize markets, attain price stability, establish property
rights, uphold rule of law, etc. We then discuss how oil prices volatility have
contributed to poverty in the Niger-delta, and its implication for the rise of violent
conflict between the host-communities and the government on one hand, and the
oil exploration companies on the other. The paper concludes that social economics
are valuable for developing an alternative view of conflict that takes seriously its
social dimensions, especially ideas of preventing or alleviating poverty in oil
producing regions, in order to forestall the incidence of conflict between host-
communities and oil exploration companies.

2. Literature review

In an attempt to examine violent conflict from a poverty perspective, Collier and

co-authors argue that people’s behaviour in conflict must be understood as
rooted in individual incentives, and conflict itself must be understood as a
process that is produced. Thus, likely participants in conflict are viewed as
implicitly making a rational choice: they choose whether to get involved in a
rebellion or not, based on whether the expected gains from rebelling exceed the
other choice-opportunity cost. Gains may also be driven by ‘‘greed—the income
that can be achieved either during the rebellion from quasi-criminal looting and the
benefits that ensue if the rebellion is victorious from control of the state revenues,’’
or they may rest in ‘‘grievance—the opposition to perceived or actual injustice’’
Collier and Hoeffler (2002). In this situation, opportunity costs are earnings
foregone from alternative economic activities, like farming, fishing and trading. The
direct consequence is the launch of conflict against governments or and business
concerns that are perceived as the cause of growing poverty.
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To assess the validity of these ideas empirically, Collier and Hoeffler (2004) conduct
an econometric analysis of outbreaks of conflict in countries in the post-World War
II period. The breakdown of the data shows a five-year interval over which the
question of what determines whether a country experiences a conflict in a given
intervals is measured i; a ‘‘violent conflict’’ is defined as an internal conflict in which
the government participated and for which there were at least 1,000 battle deaths
per year. They find that, ceteris paribus: (a) countries rich in natural resources are
more likely to experience violent conflicts, consistent with the ‘‘greed’’ idea; (b)
various partial quantitative measures matter less, casting doubt on whether
‘‘grievances’’ per se are important in explaining conflict; and (c) conflicts are more
likely to break out in countries with low per-capita incomes and poor growth
records, consistent with the idea of opportunity costs. From this they conclude that
‘‘international policies for conflict reduction should therefore be aimed at increasing
the cost of rebellion and at reducing the revenues from it’’, especially by cutting off
revenues from natural-resource sales e.g. crude oil and inflows of funds from
abroad Azam et al. (2001). It is also vital to raise the opportunity costs of conflict
by redoubling efforts to promote growth.

According to Starr M. (2006), it is denied that ‘‘objective’’ reasons for grievance

underlie outbreaks of violent conflict, it is conceded that subjectively felt grievances
can be quite important in mobilizing participation in violent conflict. This poses a
serious problem for the conclusion that policies must address greed, not grievance,
in trying to bring conflicts to an end: If subjectively felt grievances are important in
people’s understandings of their social, political, and economic lives, and help
explain their willingness to take up arms, then we cannot assume that such
grievances are devoid of content just because they are hard to trace in a statistical
way to ‘‘objective’’ circumstances. On the contrary, the existence of subjectively felt
grievances powerful enough to lead people to war suggest profound problems in the
socio-political and economic mechanisms that ought to enable different peoples to
co-exist, produce, and exchange to mutual benefit.

While multiple factors (political, cultural, religious, ethnic, linguistic) are usually at
work when differences fracture into divisions Humphreys, M. (2003), grievances
often involve economic dimensions—such as unequal access to livelihoods and
uneven distribution of public expenditure across regions; differential access to
education, jobs, and business opportunities (as in Nigeria).The role of economic
dimensions, particularly of grievance in conflicts has not been systematically
studied—a gap that was not rectified by the Collier project.

If economic grievances are important in conflicts, then the value of prioritizing

market-oriented policy reforms in post-conflict reconstruction needs to be
questioned. Starr, M (2006). As in the case of the Niger-delta, such reforms do not
directly address the problem of how to re-construct a common social and economic
environment in which peaceable coexistence is possible; rather they simply assume
that re-creating profitable business opportunities will divert people’s thoughts and
energies from conflict by raising opportunity costs. Restive oil-producing
communities, where problems of division remain are not good investment climates,
as there is considerable uncertainty about whether the peace will stick, the financial
system is inoperative, and foreign investors view risks of doing business in the
country as high; and like many other parts of Nigeria, there remain the underlying
problems of very low levels of education, limited health care, poor access to safe
water etc. These conditions are strongly unfavourable to productive investments
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and circumscribe the power of policy reforms to change the calculus of risk and
expected return; instead, in contexts such as the Niger-delta, they encourage
pursuit of opportunities for quick profits, such as kidnapping for ransoms;
smuggling, and/or arm struggle Shaxon N, (2005). Thus, this leads to what I would
call vicious cycle of conflict-when Poverty ignites violent conflict, and violent
conflicts bring insecurity and instability that make business investment and
governance impossible, which in turn impoverishes more people, who as a
consequence become vulnerable to joining militias who instigate yet more violence.

3. Conclusions and limitations

The Niger-delta region of Nigeria that produces the oil revenue for Nigeria is home
to many people who have become impoverished due to lack of facilities and
alternative means of income, having lost lands and seas to the exploration of oil.
The restiveness in the region is fundamentally as a result of the poverty of the
people and governments and oil companies operating in the area need to address
the poverty issue vigorously to forestall further violent conflicts in the region.
A pragmatic and fore-sighted approach to alleviating poverty by government and oil
exploration companies appears to be the way forward towards avoiding the trap of
vicious cycle of conflict, which as succinctly described above, does no good to any
of the stakeholders in the oil-producing region.

This paper does not of course apply a technical research methodology into how
poverty erupts into violent conflict-this aspect should be appropriately dealt with
another research paper. It does however highlights the dangers of poverty, and
how oil price volatility can lead to poverty in oil producing states with grave
consequences on peace and stability, especially in fragile environment where
valuable natural resource like oil abound.

4. References

Azam, J.-P., Colliers, P. and Hoeffler, A. (2001) ‘‘International Policies on Civil

Conflict: An Economic Perspective,’’ World Bank working paper (December).
Collier, P. and Hoeffler, A. (2002) ‘‘On the Incidence of Civil War in Africa,’’ Journal
of Conflict Resolution 46(1): 13 – 28.
Collier, P., Elliot L., Hegre, H., Hoeffler, A., Reynal-Querol, M. and Sambanis, N.
(2003) Breaking the Conflict Trap: Civil War and Development Policy, Oxford
and New York:Oxford University Press for the World Bank.
Collier, P. and Hoeffler, A. (2004) ‘‘Greed and Grievance in Civil War,’’ Oxford
Economic Papers 56: 563 – 595.
Hausmann Ricardo (2004). IMF Survey, March 15.
Humphreys, M. (2003) ‘‘Economics and Conflict,’’ paper prepared for the Program
on Humanitarian Policy and Conflict Research, Harvard University, February.
Shaxton, N (2005) ‘‘New approaches to volatility: dealing with the ‘resource curse’
in sub-Saharan Africa'', Journal of International Affairs 81, 2, 311-324.
Starr, M (2006). ''Growth and Conflict in the Developing World: Neo-liberal
Narratives and Social-Economy Alternatives'', Review of Social Economy VOL.
LXIV
Strand, H., Wilhelmsen, L. and Gleditsch, N. P. (2002) ‘‘Armed Conflict Dataset:
Codebook,’’ September

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AA118
The Sustainability Dimension in IPMA Competence Baseline
Contextual Elements at Project and Programme Levels

Demetrios C. Panagiotakopoulos
(Professor, Dept. of Civil Engineering, Democriutus University of Thrace, Greece)

Abstract
The objective of this paper is to open up a discussion regarding (a) the attributes of
sustainability affected by the project/programme manager (PM), (b) the PM’s
potential for enhancing sustainability through the contextual competence elements
of ICB and (c) the PM’s potential for affecting the natural, social, human,
manufactured and financial capitals at the project and programme levels. It is
suggested that, in project/programme management, sustainability refers to three
dimensions: (1) The survivability of the project as an operational and productive
structure within a programme; (2) the survivability of the programme as sets of
related projects; and (3) the social acceptability of the impacts (economic, social,
cultural, and environmental) from the project’s implementation process and
products and the programme’s evolvement. Two study tables are proposed as a
basis for further study. The PM’s role in enhancing sustainability is often more
crucial at the project rather than at the programme and the portfolio levels.

Keywords
Project management, Project sustainability, Programme sustainability, ICB/IPMA,
Contextual elements

1. Introduction

According to ICB (IPMA, 2006), a project or a programme of projects is an

operation to realize deliverables or business benefits which define the scope of the
operation; the project may vary from simple projects to complex endeavours.
Project Management Success is “the appreciation by the various interested parties
of the project outcomes”. This definition is more challenging than “to produce the
project deliverables within time and budget” and it smoothes the way for
introducing sustainability issues since it accepts the notions of (1) multiple
viewpoints in assessing outcomes and (2) subjective success-assessment criteria.
Still, some questions remain: How are these “interested parties” recognized and by
whom? How are future (possibly unexpected) impacts taken into consideration? In
other words, where is the “context boundary” drawn?

The performance of the project/programme manager (PM) is assessed on the basis

of criteria which are set by (and express the values and priorities of) an
Organization (government, corporation, construction company, business firm, NGO,
etc.) which is financing the operation and is interested in its outcome. Regardless of
hierarchy (project, programme, or portfolio) and scope, every such operation
1. is affected by the Organization’s competence (the “contextual framework”,
which later on will be characterized as “social capital”),
2. takes place within a specific socio-economic framework,
3. has an impact on the social, cultural and physical environments.

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The socio-economic framework sets bounds on the scope of the Organization’s

projects and imposes limits on their impacts, aiming at a “sustainable” behavior by
the Organization. These bounds and limits must be taken into consideration by the
PM who is also keen on adhering to the organisation’s strategy and enhancing its
survivability.

The sustainability of any system is assessed by its contribution to the sustainability

of its hierarchically higher system. Thus, the sustainability of a project (and, thus,
the performance of its manager) is tied to the behavior of the Organization creating
the project (or the programme of which the project is a part). The Organization’s
portfolio and its relevant programmes of projects are expected to refer to
corresponding hierarchies of scopes, criteria, inputs and results. These hierarchies,
according to IPMA, are indirectly depicted in Table 1.

Project Programme Portfolio

The goal of a is to produce is to achieve strategic is to coordinate,
deliverables change optimise and align with
strategy
Vision and are related through are realised by a are aligned to and
strategy the business case programme monitored in
of a project the portfolio
Business are largely are largely included in a are largely excluded
benefits excluded from a programme from the portfolio
project
Organisation- is often excluded is usually included in a is excluded from the
al change from a project programme portfolio
Time, costs are defined in the are roughly defined within are based on priorities
business case and the strategy; are broken and strategic targets in
are manageable in down to individual the portfolio
a project projects
Table 1: Project, Programme and Portfolio-- Main issues and differences (IPMA,
2006)

The goal of a project is to produce the deliverables defined in the business

case. Strategy itself isn’t an issue for the project manager. […..] The project
manager is not responsible for achieving the business benefits of the project.
[...] The project is often not about changing the organisation; it may
however, include educating people to fulfil their roles in a different way. If
the project concerns organisational change, then the change to be
implemented as an outcome of the project is managed by line management,
not by the project team. .. A programme consists of a set of related
projects and required organisational changes to reach a strategic goal and to
achieve the defined business benefits. . . . A portfolio is a set of projects
and/or programmes, which are not necessarily related (IPMA, 2006).

It is realized that the role of the PM in enhancing sustainability varies from project
level to programme levels. The question is whether this role widens or shrinks as
we move from project to portfolio level. Based on the above IPMA definitions, a
project can be considered as a subsystem of a programme since (1) the
performance of the programme is affected by the performance of the project and
(2) the project’s success is evaluated by the project’s contribution to the
programme performance. This coupling does not apply to the pair programme-
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portfolio. The portfolio can not be seen as system comprised of programmes.

Strategic Environmental Assessment, for example, makes sense for a programme,
not for a portfolio.

This is better understood for construction projects and programmes. A dam is a

project within a river-relocation programme. A county road is a project within a
transportation system. The projects are linked with the programmes in specific
ways affecting the performance of both. Contrary to what one might presume, the
PM’s role in enhancing sustainability is often –and especially for construction
projects-- more crucial at the project than at the programme level. This is due to
the fact that environmental and social impacts are often directly connected with the
project (and incurred at the project level), while the economic impacts relate to the
programme (wider scope). Moreover, the natural, the financial, the manufactured
and the human capitals are more directly involved and affected at the project level.

In systems terminology, this implies that the hierarchy “project-programme-

portfolio” is sensible and acceptable only from a specific viewpoint: the Owner’s.
From the point of view of the “interested parties”, the hierarchies of objectives,
needs and values do not correspond to the “project-programme-portfolio” scheme.
Matters are even more complicated by the fact that the hierarchy of objectives,
even for a specific “interested party”, does not necessarily correspond to a specific
hierarchy of technical systems.

In view of the above, the objective of this paper is to open up a discussion

regarding
1. the attributes of sustainability affected by the project/programme manager,
2. the PM’s potential for enhancing sustainability through the contextual
competence elements of IPMA competence baseline.
3. the PM’s potential for affecting the natural, social, human, manufactured and
financial capitals at the project and programme levels.

The first five of the contextual competence elements (see Table 2) “describe the
promotion of project and programme management in an organisation”. The last six
“describe what the different support functions in line organisations need to know
about projects, and what project teams need to know about the support functions”
(IPMA, 2006). As Gareis (2010) notes, “both permanent and temporary (such as
projects and programmes) organizations change, either in a continuous or in a
discontinuous manner. From a systemic point of view, reasons for changes can
either be interventions from the relevant environments of an organization or its
internal dynamics”. It has been suggested in the literature (Gareis, 2010) that
projects and programmes are a way of organizing changes. In view of the above,
the question here is how the pressure for sustainable performance affects a
project/programme oriented organization and whether such a change (should it be
desirable) can better be effected through a project/ programme.

According to Ashby’s law of requisite variety, “only variety can absorb variety”,
implying that “organizations need to build up complexity in order to cope with
complexity in their environment” (Ashby, 1970). The issues raised in this paper
may be seen as a contribution to the evolving discussion about the adjustment
processes (probably, in extreme cases, the transformation) of organizations that
desire to improve their sustainability performance.

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2. The Sustainability Dimension in Project Management1

From a systemic viewpoint, the sustainability of any system is assessed by the

system’s contribution to the sustainability of its hierarchically higher system.
Moreover, the pursuance of an objective is but a step in achieving a higher need. In
project management, higher systems and needs point to the context of the project,
while sustainability refers to three distinct dimensions:
1. The survivability of the project itself, over its useful life-cycle, as an operational
and productive structure, within a programme
2. The survivability of the programme as a set of related projects and
3. The acceptability of the overall impacts (economic, social, and environmental) as
they result from (1) the project’s implementation process and products and (2)
the programme’s evolvement and its outcomes.

2.1 Complex Adaptive Systems and Sustainability Strategies

In an ecosystem analogy, projects or programs may be studied as Complex

Adaptive Systems (CAS), characterized by non-linearity and potentially chaotic
behaviour; these characteristics imply difficulty in predicting the system’s
behaviour. Ravetz (2000) identifies four key properties that usually characterize
CAS (ecological or industrial; in our case, the project or programme) which are
sustainable:

 Co-existence: Ability to co-exist with other linked systems, at higher or lower

scales; i.e. to respect the limiting factors of the environment (natural, social,
cultural) in which it is embedded (i.e. the context of the project/programme)
and to contain its pressure on other linked systems. In project management, co-
existence is related –almost by definition—to all contextual elements.
 Effectiveness: It refers to the utilization of resources by throughput of energy or
other resources.
 Robustness or Resilience: As the context (i.e. the organizational or physical
environment) in which systems are embedded may be dynamic and in constant
change, the system (in our case, the project) should be resilient, i.e. able to
maintain its structure in a variety of external conditions.
 Adaptability: Apart from being resilient, a system needs to evolve and change its
structure and functions; to survive changes of its environment as it moves into
different attractors. Internal variety and complexity are needed for both robust-
ness and adaptability.

2.2 The Five Capitals Model

As already presented by Panagiotakopoulos (2008), according to the Five Capitals

Model (FCM) (The Sigma Project, 2003) of sustainability, every project, programme
or company needs five capitals, as inputs or resources, to function properly:
 Ecological or Natural capital (N): the natural resources (energy and material)
and processes needed to produce products and deliver services (mainly of
technical nature, according to IPMA categorization of competence elements).

1
The analysis and the formulation of the arguments of Paragraph 2 are based on Panagiotakopoulos
(2005). See also Panagiotakopoulos (2008).

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 Manufactured capital (M): the material goods (tools, machines, buildings, and
other infrastructure) which contribute to the production process but do not
become embodied in the outcome (also of technical nature).
 Human capital (H): incorporates the health, skills, intellectual outputs,
motivation and capacity for relationships of the individual, which can contribute
to the productive work. It is also about dignity, joy, passion, empathy and
spirituality. For companies, human capital mainly refers to their staff, business
partners and suppliers (mainly of behavioural and contextual nature).
 Social or organisational capital (S): The organizational schemes, such as human
relationships, state rules, laws, partnerships and co-operation, through which
the transformation of inputs to outputs is realized. It embraces communication
channels, communities, businesses, trade unions and voluntary organisations
(mainly of behavioural and contextual nature).
 Financial capital (F): The assets of an organisation that exist in a form of
currency that can be owned or traded (of technical nature).
One could add a sixth type of capital, the cultural capital (C), which refers to
cultural social norms, values and trust.

Panagiotakopoulos (2005) extended this notion of the FCM to a project. The

completion of a project requires the use of a combination of the above five capitals.
At the programme level, the selection of the five-capitals combination concerns
mainly the production process; at the portfolio level, it concerns mainly (1) the
products and their lasting impacts and (2) the impacts on the employed capitals
themselves.

For each of the above capitals we recognize critical levels or boundaries which must
not be surpassed; for example, we recognize the absorbing capacity of the physical
environment, the democratic institutions, the laws, the local customs and the trade
unions regulations as boundaries for the social capital, the human dignity as
boundaries for the human capital, or the budget limits for the financial capital.

3. Sustainability of a Project – The Role of the PM

A widely accepted, and politically convenient definition for a sustainable project is a

project whose economic, social, environmental and cultural impacts are socially
acceptable. The immediate concerns arising from such a definition are: Acceptable
to whom, to society in general or to “the interested parties”? Do these sets differ?
What of the economic and environmental externalities? Who speaks for future
generations?

Realizing that there can never really be a universally accepted and unquestionable
definition of a “sustainable project”, the issue is bypassed by introducing the notion
of a project’s or programme’s contribution to sustainability. This contribution is
assessed through reference to
 the employment of the five capitals and the extent of their exploitation and
 the societal acceptance of the resulting environmental, social and economic
impacts.
Any action by the PM that enhances the project’s contribution to sustainability is
desirable. But how is sustainability enhanced? Here are some ground rules:

1. The broader the scope or the viewpoint of the assessment, the better. This
might initially suggest that one should look at the programme rather than at the
project. Yet, more often than not, the impact of the project might be greater. As
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already argued, the hierarchy project-programme-portfolio might be sensible

only from the Organization’s or the Owner’s viewpoint. This is especially true in
construction: The impact of a dam or a road might be more evident and directly
felt by the interested parties than the impact of wider hydro-project or of a
transportation system.

2. The critical level of each and every of the five capitals is respected. The
recognition of these levels is another matter and depends on the societal values
and priorities.

3. The wider the societal acceptance of the economic, social and environmental
impacts, the better. The more the interested parties that consent, the better. Of
course, the interested parties at the programme level might be more and more
powerful than at the project level, although, not infrequently, the programme’ s
impact are not evident.

4. The longer the time horizon over which impacts are assessed, the better. A life-
cycle perspective is desired. Some impacts last for decades, others for centuries
or forever. Time horizon refers mainly to projects, even in cases of project
synergies within a programme. The natural capital is better managed at the
project level, the financial at the programme and the cultural at the portfolio
level.

5. If a project is a true subsystem of a program (not from the owner’s, but from
the interested parties’ perspective), it is the sustainability of the higher system
that counts. There can not be a sustainable project within a socially
unacceptable programme. (Compare to the case where the project management
is successful but the project a failure). Thus, the hierarchy of needs enters the
picture. It is noted, however, that, for a specific point of view, the system
hierarchy does not coincide with needs and objectives hierarchy –a fact that
further complicates the sustainability analysis.

Table 2 is a proposed study table for the potential of the PM to enhance project
sustainability. The second column is a list of the IPMA (2006) contextual elements.
The third column shows the relevant complexity property for each contextual
element. The entries in columns 4 to 6 are supposed to express the PM’s position
vis a vis each of the 11 contextual competence elements. All entries are
challengeable preliminary assessments, by this author, of the PM’s authority and
his/her impact on the parameters affecting project’s sustainability. They are
supposed to show, in the opinion of this author and with regard to each element,
how the PM appreciates the situation and whether she/he can affect it. Specifically:

Column 3: Expresses the author’s assessment of the complexity properties that

relate to each element:
C: Co-existence, E: Effectiveness, R: Robustness or Resilience, A:
Adaptability.
Column 4: Expresses the PM’s role regarding the element. Symbols D and C are
employed as follows:
D: Decisive. The PM is the main, the decisive decision-maker.
C: Contributory. The PM contributes to relevant decisions that are taken
at higher levels of management.
Column 5: Indicates whether the PM, by his decisions, affects mostly the:

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Viewpoint (V), i.e. criteria, objectives and scope of the project

Extent (E) of social acceptance
Time horizon (T) of the impacts of decisions taken by the PM
Hierarchically (H) higher system (programme)
Column 6: Indicates which of the Five Capitals (N, M, H, S or F) and the cultural (C)
are primarily involved in dealing with the corresponding element.
It is again noted that the entries in Table 2 refer only to the PM’s potential at the
project level.

ICB Contextual Element PM’s Role: The PM mostly affects: Mainly

Complexity Affected
Properties D: Decisive V: Viewpoint Forms of
C: Contributory E: Extent of Acceptance
Content Capital
No. T: Horizon of impacts
H: Higher system

(1) (2) (3) (4) (5) (6)

3.01 Project C, A, R D V, E, T, H ALL
orientation
3.02 Programme C, A, R C E, T, H S, H, F
orientation
3.03 Portfolio C, R, E, C E, T, H F, H, M, N
orientation A
3.04 PPP C, A, D H, T ALL
implementatio
n
3.05 Permanent C, Ε, Α, C H, T ALL
organisation
3.06 Business A, C, C E , H, T S, H, C, F
3.07 Systems,
products & C, E, D V, H, T ALL
technology
3.08 Personnel E, A D H, E H, S
management
3.09 Health, E D E, T, H H, S, N
security,
safety &
environment
3.10 Finance E,A C V, E , T, H F, M, N , S
3.11 Legal E,A C V, E , T, H F, S, H

Table 2: The PM Potential for Enhancing Sustainability through the Contextual

Competence Elements at the project level

Table 3 shows this author’s assessment of the severity of impact upon each of the
six capitals at the project and programme levels, with emphasis on the construction
sector. Here we consider the impact on each type of capital, looking at it as a
productive resource, as an input to the process, not as a recipient of impacts. For
example, a construction project affects the natural and the manufactured capitals
severely as it uses and transforms them. This does not happen with the social
capital, since the rules and the organized social structures are not severely
affected. This is not to say that the social impacts are negligible. Social capital
(which is an important input to the project, a part of the project’s “context”) does

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not coincide with the social impact (output) of the project. Obviously, the
assessment varies on the basis of the type and context of the specific construction
project. At programme level, there is potentially bigger impact on rules and
organizational schemes, since they can be more easily changed. But, again, this
analysis here is an invitation for argument, not a justification for a specific
position.

Severity of Impact on the Six Capitals

Natural Social Human Manufactured Financial Cultural
Project S L M S M L
Programme M M L M S S

Table 3: Impact on the Six Capitals at the Project and Programme Levels (S:
severe, M: moderate, L: light)

4. Conclusions

The issues raised in this paper may be seen as a contribution to the evolving
discussion about the adjustment processes (probably, in some cases, the
transformation) of organizations that desire to improve their sustainability
performance. The question is how the social pressure for sustainable performance
affects a project/programme oriented organization and whether such a change
(should it be desirable) can better be effected through a project/ programme. The
main conclusion of this paper is the suggestion that Project and Programme
Management has a crucial role in enhancing organizational sustainability and
Sustainable Development in general. So, an attempt is made to open the discussion
on the PM’s role and to outline a procedure for assessing its significance.

Essentially, here, an additional criterion, referring to sustainability, is proposed for

assessing project management success and an indirect suggestion is made to
include these issues in the PM’s training and certification.

5. References

Ashby, W.R. (1970), Process of Model-Building, Ohio State University Press, Columbus.
Decleris, M (2000), The law of sustainable development, General Principles, Brussels, European Commission.
Gareis (2010), Changes of organizations by projects, special issue of The International Journal of Project Management,
Vol.8, No. 4, pp. 314-327.
IPMA Competence Baseline, Version 3.0, The Netherlands, 2006.
Panagiotakopoulos, P. (2005), A Systems and Cybernetics Approach to Corporate Sustainability in Construction, Ph.D.
Thesis, Heriot-Watt University, Edinburgh.
Panagiotakopoulos, D. (2008), The Sustainability Dimension in IPMA Competence Baseline Technical Elements, PM-
04 Conference, 29-31 May 2008, Chios, Greece.
Ravetz, J (2000), “Integrated assessment for sustainability appraisal in cities and regions”, Environmental Impact
Assessment Review, 20, 31-64.
Schot, E, Brand, E & Fischer, K (1997), The Greening of Industry for a Sustainable Future: Building an International
Research Agenda, The Greening of Industry Network and The Netherlands Advisory Council for Research on
Nature and Environment (RMNO).
The Sigma Project (2003) The SIGMA Guidelines. Putting sustainable development into practice- a guide for
organisations, http://www.projectsigma.com/

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AA052

The role of health, safety and green principles in estimating

construction productivity: an empirical framework

Antonios Panas
(PhD Candidate, Centre for Construction Innovation, National Technical University
of Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Greece)

Sergios Lambropoulos
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Greece)

Abstract
The current approach to construction health and safety (H&S) and green building
underestimates the role of production practices and focuses mainly to the
formulation of general guidelines and best-practice policies. This paper adopts a
different approach in that it integrates workers’ health as expressed by their
thermal comfort and environmental parameters in productivity estimation. An
empirical framework is presented to evaluate the relationship of the Predicted Mean
Vote index to operational efficiency. Process mapping and simulation-based analysis
is used for the creation and comparative analysis of productivity models. An
exemplar investigation of formwork operations illustrates the applicability of the
proposed approach. The main conclusion from the study is that the implementation
of the empirical framework enables the creation of foresight in planning
construction operations by analysing productivity variations compared to baseline
estimates. It is believed that such an approach provides a more realistic
representation of construction operations and improves the accuracy of the
estimating process.

Keywords
Construction, health, process, productivity, thermal comfort

1. Introduction

The protection of the workers’ well being and the establishment of a safe working
environment are key prerequisites for the achievement of sustainability in
construction (Rajendran et al. (2009)). However in traditional practice the issues of
Health and Safety (H&S) are addressed by the formulation of general guidelines,
best-practice policies and operating procedures (Wang et al. (2006)), whereas
issues relating to work methods and production practices are often ignored
(Mitropolulos et al. (2009)). Therefore this paper adopts a different approach in
that it integrates H&S and environmental parameters in productivity estimation.
Construction workers’ H&S is assessed through the evaluation of the thermal
comfort, which is a key environmental parameter for rating green buildings. A non-
linear relationship between thermal comfort and productivity is established, as a
means for quantifying the effect of the environment on job efficiency. Given that
construction productivity is often studied in a fragmented manner, the purpose of
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the study is to overcome this deficiency and establish an explicit empirical

framework that will (i) enable the creation of productivity forecasting models based
on environmental data, (ii) delineate the experimental setting for conducting valid
productivity measurements in relation to parameters associated with thermal
comfort and (iii) set out the criteria which will allow the comparative analysis of the
produced estimates.
In the remainder of this paper a brief review of pertinent research on health, safety
and green principles is presented along with a description of the main parameters
used for the evaluation of the thermal comfort. Then, the research methodology is
explained followed by a discussion on the proposed empirical framework. An
exemplar evaluation of the suggested approach is presented for formwork
operations. Finally, the main conclusions emerging from the study are elucidated.

2. Background

2.1 Integrating health, safety and green principles

Sustainability is an overarching concept that affects, and can be affected by, every
aspect of infrastructure development (Sev (2009)), including the delivery of
sustainable construction projects. A concept closely associated with sustainable
construction (SC) is that of “green principles”, namely the adopted design and
construction practices that are related to the environment (Rajendran et al.
(2009)). The measurement of construction projects’ adherence to green principles
is achieved through the implementation of green rating systems, such as LEED
(2009). However it seems that green rating systems address the issues of H&S in
an ad-hoc manner, making no linkage to operational or working practices which are
a key determinant of the H&S status achieved on site (Pantouvakis and Panas
(2010)). As such, this study aims at coupling H&S strategies and productivity
considerations for shifting current project management perceptions in the pursue of
a more sustainable construction environment.

2.1 Thermal comfort as a key productivity parameter

It has been long acknowledged that the thermal environment affects labour
efficiency and may reduce their productivity (Thomas and Yakoumis (1987)). The
effect of the thermal comfort on construction operations has drawn limited
attention, hence leaving construction planners or estimators with insufficient
information to deal with especially in the design stage (Srinavin and Mohamed
(2003)). The most widely used thermal comfort metric today is the Predicted Mean
Vote (PMV) index (ISO 7730 (2005)), which represents the thermal strain based on
a steady-state heat transfer between the body and the environment. PMV takes
values in the range of ±3 where 0 is the ideal thermal comfort point and +3/-3
denote extreme hot or cold environments respectively. PMV is derived from a
steady-state model whose main parameters are summarized in Eq. (1) to (5) (ISO
7730 (2005)).

PMV  0.303  e 0.036M  0.028  
M  W   3.05  10 3  5733  9.99  M  W   p a   0.42  M  W   58.15
  (1)
  1.7  10 5  M  5867  p a   0.0014  M  34  t a  


8
 4 4

 3.96  10  fcl  t cl  273  t r  273  fcl  h c  t cl  t a  


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t cl  35.7  0.028  M  W   I cl 
3.96  10 8
 
 fcl  t cl  273  t r  273  f cl  h c  t cl  t a 
4 4
 (2)

0.25
2.38  t  t 0.25
for  2.38  t cl  t a  12.1 v ar
cl a
hc   0.25 (3)
 12.1 v ar for  2.38  t cl  t a  12.1 v ar

1.00  1.290  I cl for  I cl  0.078m 2  K / W

fcl   (4)
1.05  0.645  I cl for  I cl  0.078m 2  K / W

p a  R h  10  EXP16.6536  4030.183 /t a  235 (5)

where M=metabolic rate [W/m2]; W=effective mechanical power [W/m2];
Icl=clothing insulation [m2·K/W]; fcl=clothing surface area factor [-]; ta=air
temperature [ºC]; tr=mean radiant temperature [ºC]; var=relative air velocity
[m/s]; pa=water vapour partial pressure [Pa]; hc=convective heat transfer
coefficient [W/m2]; tcl=clothing surface temperature [ºC]; Rh=relative humidity
[%].

PMV’s estimation is possible if six of the above parameters are known (usual values
in brackets): metabolic rate (M within 46–232W/m2 or 0.8–4.0met), thermal
insulation (Icl within 0–0.310m2·K/W or 0–2clo), air temperature (ta within 10–
30ºC), mean radiant temperature (tr within 10–40ºC), relative air velocity (var
within 0–1m/s) and relative humidity (Rh within 30–70%) (ISO 7730, 2005). The
most relevant research effort to associate PMV with productivity is the regression
model developed by Srinavin and Mohamed (2003) for painting, bricklaying and
manual excavation operations. However, this model can be criticised for being
strictly deterministic, lacking a clear experimental framework and being limited in
scope. As such, this study adopts the PMV index within a consistent empirical
framework that allows the creation of parametric deterministic and/or stochastic
productivity forecasting models that are adjusted to specifically suit the job in hand.

3. Simulation modelling

In this study, construction operation analysis and process mapping is based on the
STRBOSCOPE simulation language and simulation models for productivity
estimation are created with the EZStrobe simulation package (Martinez (2001)),
whose basic modelling elements are depicted in Table 1. The investigation of PMV’s
role as a health metric in productivity estimation is undertaken for both the
deterministic and stochastic analysis approach. Deterministic simulation models
utilize published historical productivity data (e.g. RSMeans (2009) price book), so
as to determine the cycle time duration for specific construction activities. Given
that deterministic analysis assumes 100% work efficiency, the deterministic
simulation models use an efficiency factor whose value is specified by the estimator
to represent the subjective effect of qualitative variables on productivity (Zayed
and Halpin (2004)), such as safety risk. On the other hand, stochastic analysis is
based upon probabilistic data sets stemming from on-site measurements by the use
of established work study methods (Alfeld (1988)). In order for both the
deterministic and the stochastic approaches to be comparable, the same output
analysis method is deployed: each simulation run set comprises of 40 replications
at a 95% confidence level, resulting in an unbiased point estimator of average
productivity. More details on the proposed empirical framework are provided in the
next section.
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EZStrobe simulation platform

Modelling element Name Description

Logically constrained in its starting logic, otherwise similar

COMBI
to the NORMAL element. Always preceded by Queue Nodes.

Logically unconstrained in its starting logic, indicates active

NORMAL
processing of (or by) resource entities.
Precedes all COMBI activities and denotes the idle state of a
QUEUE
resource entity symbolically representing a queuing up or
NODE
waiting for use of passive state resources.
Indicates the logical structure of the model and direction of
ARROW
entity flow.

Table 1: EZStrobe modelling elements

4. The proposed empirical framework

The proposed methodological framework for the investigation of thermal comfort

and productivity is shown on Fig. 1. It is essentially a four-phase process whose
steps are explained in the next paragraphs.

Phase 1 – Preliminary steps

The first phase initiates with the definition of the activity and the respective number
of sub-tasks (ns) required for completing it. In addition, the analyst identifies the
risk associated with the activity along with a classification of possible accidents.
Using risk taxonomies included in industrial classification codes the estimator
evaluates the safety demand imposed on the respective labour crew for a given
operation. In other words, the safety demand reflects the added difficulty imposed
on a crew when executing a work task, due to deviations from the normative
activity description in comparison to the job in hand.

Phase 2 – Forecasting productivity model

The definition of the operational setting enables the creation of a forecasting model
based on historical data. These data serve as a basis for the definition of the
Baseline Reference Productivity (BRP), namely each activity’s cycle time per unit of
measurement (e.g. h/m2). However, for every standard BRP estimate allowances
have to be added to reflect possible losses in productivity due to the peculiarities of
the current construction operation, since past construction operations can never be
replicated in the exact same way in future projects. For the current study the
induced productivity losses are represented by an empirical efficiency factor (E),
which can be either a constant value or a distribution taking values in the range of
[0,1]. The expected productivity (EP) of each activity is established as a sum of the
respective EP of all its sub-tasks. In case only a cumulative productivity estimate
for the entire activity is available, sub-tasks productivity is specified according to
empirical rules. Finally, the expected environmental conditions are defined based on
previous experience or historical meteorological data.

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Phase 3 – Empirical productivity model

This is a parallel phase to the one before, aimed at delineating the experimental
framework for the evaluation of the relationship between the PMV index and
productivity. First, the operational reference conditions are defined (e.g. building
element, crew characteristics, shift), followed by a specification of the PMV
parameters that are going to be measured. Then, work studies are undertaken to
elicit productivity data and measure the PMV parameters by the use of appropriate
instrumentation (direct observation for the former and thermal camera combined
with probe sensors for the latter). The collected data is categorised in clusters
based on the six main PMV parameters specified in section 2.2. In case a
statistically sufficient amount of data is contained in each cluster, then probabilistic
analysis determines the distribution of the activities’ duration. On any other case,
supplementary data has to be provided otherwise the operational setting
represented by the specific data cluster cannot be qualified for modelling and
analysis.

Phase 4 – Modelling process

The modelling phase commences with the mapping of the construction processes.
Simulation models are created for every cluster’s dataset and intra-cluster analysis
is undertaken to compare the results. In the case of the forecasting productivity
models, simulation is used to generate productivity outputs based on BRP inputs,
whereas for empirical models activities’ durations are assumed to be probabilistic.
Simulation output is validated and a regression analysis between PMV and
productivity is undertaken. Key parameters are varied to evaluate the system’s
sensitivity and the comparative analysis of the results finalises the investigation.
Preliminary steps Forecasting productivity model Empirical productivity model

START Estimate Baseline Reference Define reference conditions

Productivity (BRP) as time for experimental
per unit of measurement framework

Define Assess efficiency factor (E) Define PMV measurement

activity (i) from qualitative analysis parameters (p i)

E  Const.|| D istr.  0,1 Elicit work study data

Specify
number of
sub-tasks Estimate deterministic
(n s) For each parameter p i
Expected Productivity (EP)
specify j data clusters (Cij)
for activity (i)

Identify risk ns NO
for each
sub-task
EP i   E i    BRP k Cluster data valid?
k 1 YES

Define expected Allocate probabilistic

environmental conditions for duration datasets
PMV index estimation to each cluster

Modelling process

Map construction YES Intra-cluster YES

Model verified? Output valid?
process simulation analysis
NO NO

Comparative Sensitivity Regression analysis

END P = f(PMV)
analysis of results analysis productivity model

Fig 1: Proposed empirical framework

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5. Exemplar implementation for formwork operations

The proposed methodology is implemented for a hypothetical analysis of foundation

walls formwork operations taking place in Athens, Greece. Historical productivity
data published by RSMeans (2009) and meteorological data provided by the
Hellenic National Meteorological Service (HNMS (2010)) are used for the forecasting
models. The development of the empirical models is based on field data provided
by Thomas and Yakoumis (1987) with respective rationalization adjustments where
appropriate. The application of the steps described in section 4 yields the following
results.

Phase 1 – Preliminary steps

The investigation regards formwork operations for basement walls which comprise
five (ns=5) sub-tasks as follows: Fabrication, erection, plumbing, stripping and
cleaning. The main risks associated with fabrication are cutting and lifting/lowering
of materials, whereas attention should be given to nailing/screwing/drilling
operations when erecting the form panels to avoid transportation accidents or
overexertion. Plumbing involves using bodyweight, pry bars or other equipment to
shift and adjust the formwork which increases the risk of getting caught within the
structure. Stripping operations that occur above or below grade typically require
workers to ascend or descend ladders to manually transport equipment and
materials and relates to the risk of falling on lower or the same level. Form
lubrication and preparation involves spraying form oil and/or curing compound,
thus exposing labour crews to harmful substances.

Phase 2 – Forecasting productivity model

Each sub-task’s BRP is estimated according to formwork operations cumulative
productivity data averaged at 1,292h/m2 (RSMeans (2009)). The efficiency factor
(E) is assumed to take values in the range of 0.75–1.00 following a uniform
distribution. Historical meteorological data show that the minimum, average and
maximum expected air temperature in March would be 8.4ºC, 12.3ºC and 15.7ºC
respectively, with an average humidity of 65,9%. Finally, 35 data points for the
PMV index were calculated for gradual variations of ta.

Phase 3 – Empirical productivity model

Foundation wall formwork executed by an experienced crew in an 8-hour shift is the
focus of operations. Eq. (1) to (5) were computed in a spreadsheet program and
the PMV index was estimated for the six main parameters (M, Icl, ta, tr, var, Rh)
under the following assumptions: The metabolic rate for formwork operations was
taken equal to 180W/m2 or ~3.1met. Work clothing comprising of “underwear with
short sleeves and legs, shirt, trousers, jacket, socks and shoes” (ISO 7730 (2005))
was assumed for the whole crew (Icl=1.00clo). Wind velocity was set at 0.25m/s as
a representative value of outdoor construction tasks. The rest of the parameters
are input variables in the model. One data cluster has been defined for M, Icl, ta, tr,
var, Rh with the respective cluster range being [2.75-3.44met], [0,9-1,2clo], [8.4-
15.7]ºC, [11.4-18.7ºC], [0.22-0.27m/s] and [65-67%] respectively. This means
that valid comparisons should be undertaken for models comprising data that fit to
all of the aforementioned clusters. In any other case the comparison would be
statistically invalid since it would represent a different empirical paradigm. The
latter is going to be highlighted in the next paragraph. Lastly, field data from
Thomas and Yakoumis (1987) representing 35 productivity measurements for
formwork operations were processed and the respective PMV values were
estimated.
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Phase 4 – Modelling process

A generic simulation model was created to represent the construction process, as
shown in Fig. 2. 35 independent simulation runs were undertaken for the
forecasting model and the results are illustrated on Fig. 3. The forecasting model is
consistent with the established notion that the more comfortable the thermal
environment (i.e. PMV closer to 0), the more productive a crew can be. Moreover,
under the effect of the efficiency factor, simulation-based analysis indicates a drop
in optimum productivity of about 10% compared to a 25% decrease in case of a
deterministic value. An interesting point of the analysis emerged when an attempt
was made to categorize the empirical data into the pre-specified clusters, so as to
compare forecasting and empirical models. It was noted that not a single data point
from the empirical data set suited the cluster structure of the forecasting one (four
data points fitted the ta cluster but none the Rh cluster). This exemplifies the
importance of an explicit determination of the experimental framework, otherwise
productivity models of a notably low coefficient of determination (R2) will be created
which, although providing an indication of the productivity threshold, have a limited
practical utility (Fig. 4). Finally, a sensitivity analysis revealed that the PMV model
is particularly sensitive to the metabolic rate which represents the difficulty of the
task being performed.

Fabricate SMCA Erect SMCA Plumbing SMCA Stripping SMCA Clean

>=SMCA , SMCA FabDur ErectDur PlumbDur StripDur CleanDur
SMCA
1

Formwork >0 , 1 FrmCrew ComplFrm

FrmAmnt nCrews

Fig 2:
Generic simulation model for formwork operations

1,50 5,00
Productivity [h/m2 ]

Productivity [h/m2 ]

4,40
1,48
3,80
1,46 3,20
2,60
1,44
2,00
1,42 1,40
0,80
1,40 0,20
0,2 0,4 0,6 0,8 1,0 1,2 0,0 0,5 1,0 1,5 2,0 2,5
PMV PMV

Fig 3: PMV forecasting model Fig 4: PMV empirical model

6. Conclusions

This presented work demonstrates that construction labour’s productivity variation

can be interpreted by sustainable concepts pertaining to occupational health and
well being, as expressed by the thermal environment. Simulation-based analysis of
the impact of thermal comfort on labour productivity creates insight regarding the
work practices of construction labour crews, whose behavioural attitude is rarely
included in quantitative productivity analyses. The use of the PMV index helps in
relating key environmental variables to productivity. The current approach
emphasizes on the creation of a robust empirical framework that enables the
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realisation of valid productivity measurements and the subsequent development of

comparable productivity models. In addition, the explicit definition of the
experimental framework allows the characterisation of each study’s applicability
and respective scope limitations. The latter contributes to overcoming the
methodological inconsistency inherent in many productivity studies, which leads to
the creation of fragmented models to the detriment of comparative validity. As
such, a more realistic representation of construction operations is achieved which
improves the accuracy of the estimating process.

7. References

Alfeld, L.E. (1988), “Construction productivity: on-site measurement and management”,

Mc-Graw Hill, New York.
HNMS (2010), “Climatological data for the period 1955-1997”, Hellenic National
Meteorological Service, Athens.
ISO 7730 (2005), “Ergonomics of the thermal environment - Analytical determination and
interpretation of the PMV and PPD Indices and local thermal comfort criteria”,
International Organization for Standardization, Geneva.
LEED (2009), “Leadership in Energy and Environmental Design”, United States Green
Building Council, Washington, USA. <http://www.usgbc.org/LEED> (Jan. 18, 2010).
Martinez, J., C. (2001), “EZStrobe: General purpose simulation system based on activity
cycle diagrams, in: Peters, B.A., Smith, J.S., Medeiros, D.J. and Rother, M.W. (ed.),
Proceedings of the 2001 Winter Simulation Conference, Arlington, 9-12 December 2001,
IEEE Standards Association, Piscataway.
Mitropoulos, P., Cupido, G. and Namboodiri, M. (2009), “Cognitive approach to construction
safety: Task demand-capability model”, Journal of Construction Engineering and
Management, 135(9), 881-889.
Pantouvakis, J.P. and Panas, A. (2010), “The contribution of health & safety management to
sustainable development: A case study from the construction industry”, in: Proceedings
of the 2010 IPMA International Expert Seminar, Zurich (in press).
Rajendran, S., Gambatese, J.A. and Behm, M.G. (2009), “Impact of green building design
and construction on worker safety and health”, Journal of Construction Engineering and
Management, 135(10), 1058-1066.
RSMeans (2009), Building construction cost data: 67th annual edition, R.S. Means Company
Inc., Kingston.
Sev, A. (2009), “How can the construction industry contribute to sustainable development?
A conceptual framework”, Sustainable Development, 17, 161-173.
Srinavin, K. and Mohamed S. (2003), “Thermal environment and construction workers’
productivity: some evidence from Thailand”, Building and Environment, 38, 339-345.
Thomas, H.R. and Yakoumis, I. (1987), “Factor models of construction productivity”, Journal
of Construction Engineering and Management, 113(4), 623-639.
Zayed, T.M. and Halpin, D.W. (2004), “Simulation as a tool for pile productivity
assessment”, Journal of Construction Engineering and Management, 130(3), 394-404.
Wang, W.C., Liu, J.J. and Chou, S.C. (2006), “Simulation-based safety evaluation model
integrated with network schedule”, Automation in Construction, 15, 341-354.

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W12

A Critical Review of Published Research on Construction Productivity

Antonios Panas
(PhD Candidate, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
Despite the large number of published papers in the area of construction
productivity, a critical review of contemporary thinking with a discussion of the
implications to current researchers is rarely attempted. As such, this paper
investigates the subject based upon published papers in major peer-reviewed
journals during the last decade. Eighty-nine papers published in both construction
journals and broader management science journals have been analysed. The
research taxonomy identified three major fields: Archival studies, empirical
research and simulation proposals. In terms of the methodological structure
followed, three major categories have been recognized: Experimental frameworks,
data collection techniques and modeling proposals. The main conclusion is that the
selection of the research methodology in published journal papers has been an
intuitive decision, grossly relating upon the researcher’s ontological and
epistemological stance. However, general guidelines on the selection of the most
appropriate methodology in relation to the research objectives are also discussed
herein.

Keywords
Construction, Methodology, Productivity, Research

1. Introduction

The establishment of the most appropriate methodology for construction research is

a current subject of concern. This is corroborated by the special issue of the Journal
of Construction Engineering and Management (Volume 1, Issue 1) on research
methodologies for Construction which only appeared at the beginning of 2010. A
previous somewhat organized approach to the subject can be traced back in the
mid to late 1990’s with a series of papers appearing in Construction Management
and Economics (Volumes 13-16). The review of those and some other
supplementary sources (from relevant papers which did not appear in the above
mentioned journals and periods) has led to a number of questions relating to
construction management research methodological issues; What are the most
suitable criteria for selecting the research methodology? How can the rigour and
robustness of a research effort be evaluated? What are the current trends?
The above and similar questions have formed the motivation for the research
described in this paper. More specifically, in this paper we aim to provide answers
to the above questions, with a particular focus on research related to construction
productivity (CP). The field of CP is an expedient research area since the complex
and versatile nature of the subject has led to the implementation of multiple
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methodological approaches. As such, this study explores the different perspectives

for measuring or estimating construction productivity. The main purpose is to
capitalise on the trend towards methodological rigour and comprehensiveness by
soliciting papers on methodologies that are identified as being typically employed in
construction productivity research.

2. Theoretical background

The debate on construction research as expressed in Seymour et al. (1997)

resulted in a controversy between academics favouring the positivist perspective,
which is closely related to rationalism, empiricism and objectivity (Hariss, 1998)
and the ones in favour of the interpretivistic approach, which highlights the
subjectivity of truth and reality since it depends on the persons investigated (Rook
et al., 1997). Traditionally, the former is associated with quantitative research,
whereas the latter is related to the qualitative research approach (Fellows and Liu,
2003). However, the current research trend seems to extend beyond the sterile
debate limited by the dichotomies of the past and supports a shift towards
encouraging more or different research techniques and paradigms to be employed
in construction management research, often termed as “multimethodology”
(Dainty, 2008). The latter is particularly relevant for CP research, where social and
natural science methods are frequently intertwined (Abowitz and Toole, 2010).
As this study’s objective is to critically review published research on construction
productivity irrespective of the adopted approach, a challenge for the authors was
the formulation of a concise and generic set of criteria for the evaluation of all types
of research efforts included in the analysis. It has been decided to use two metrics:
 The researcher’s ontological and epistemological stance (Dainty, 2008); and
 The satisfaction of the unique adequacy (UA) requirement of methods, as
proposed by Rooke and Kagioglou (2007).

Ontology refers to the conceptions of reality and is divided in “objectivist ontology”

which evaluates social phenomena independent of the social actions (quantitative
approach) and “constructivist ontology” which recognises that social phenomena
are dynamic and produced through social interaction (qualitative approach) (Dainty,
2008). Epistemology refers to what should be regarded as acceptable knowledge in
a discipline and is characterised either by a positivist (quantitative) or
interpretivistic (qualitative) perspective as mentioned in the first paragraph of this
section (ibid.). Whereas the first metric evaluates the researcher, the UA
requirement addresses both the researcher and the research itself, through the
definition of two satisfaction criteria: the weak and strong forms (Rooke and
Kagioglou, 2007). For the UA requirement to be satisfied in its weak form, the
researcher must be familiar with the setting under study. For example, a
questionnaire should be designed by someone who has direct knowledge of the
activity under study. On the other hand, Rooke and Kagioglou (2007) state that the
strong requirement concerns the reporting of the research and is based upon the
premise that the methods of analysis used to report on a setting should be derived
from that setting. In other words, the method of analysis should not necessarily be
determined a priori, but emerge from the particular setting that is investigated. The
UA adequacy is primarily used for evaluating qualitative research without however
excluding its application for quantitative approaches. In addition, satisfaction of the
weak requirement is a prerequisite for the achievement of the strong requirement
(Rooke and Kagioglou, 2007).

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3. Research methodology

The research strategy used for this paper was to launch a comprehensive review of
the CP literature from 1999 to 2009. Eighty-nine (89) papers were selected from
top quality journals. 72 papers (81% of the sample) stem from five top quality
construction management journals (number of articles in brackets): Automation in
Construction (AutoCon) (11), Construction Management and Economics (CME) (10),
Engineering, Construction and Architectural Management (ECAM) (5), Journal of
Computing in Civil Engineering (JComCE) (5), and Journal of Construction
Engineering and Management (JCEM) (41). The rest can be found in journals that
cover a broader spectrum of management science regarding productivity (e.g.
International Journal of Project Management; International Journal of Productivity
and Performance Management; Personnel Review). The qualitative content analysis
technique was implemented, so as to introduce some form of taxonomy in the data
(Fellows and Liu, 2003). A three-level hierarchical classification system has been
developed for the analysis (Fig. 1). First, three broad classifications have been used
for evaluating the researchers’ stance: (1) Qualitative, (2) Quantitative, and (3)
Mixed-method approach (combination of the first two). A further sub-classification
step identified three major categories: (1) Archival study, (2) Empirical research
and (3) Simulation proposals. It should be noted that although simulation can be
regarded as part of empirical research (Flood and Issa, 2010), it has been decided
to be represented by an autonomous category due to its methodological
peculiarities (Martinez, 2010). Further analysis showed that the utilized methods
and tools focus mainly on: (1) the development of experimental frameworks, (2)
the description of data collection techniques and (3) the suggestion of modelling
methodologies. Where the research methodology, strategy or design was not
clearly defined within the paper, the adopted methodology was identified from the
narrative description of the research (Dainty, 2008). In the next paragraphs, the
research taxonomy is elaborated in detail, based on specific data from the sample
analysis.

Fig. 1: Construction productivity research taxonomy

4. Analysis of the results

4.1. Descriptive statistics

The total number of papers published in the selected journals in comparison to the
CP related papers is shown on Fig. 2a below. A more detailed analysis within the
selected journals shows that JCEM has the highest publication rate of 3.24%
followed by AutoCon by 1.32% (Fig. 2b). Papers come from 14 countries, where
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USA takes the lead with 44 papers, followed by China (incl. Taiwan and Hong Kong)
with 18, as shown in Table 1 illustrating the top-5 countries. Canada, the United
Kingdom, Australia and South Korea also seem to be major contributors. Out of 149
researchers, the top-10 most cited authors are shown in Table 2, along with the
respective number of publications. In parenthesis is shown the current research
institution and published work, in case the author has changed in the last decade.
Finally, Table 3 summarizes the most frequently cited papers, according to the
Institute for Scientific Information’s (ISI) index.

700 652 1400 1266

1171
600 546 543 549 1200 1094
487
500 447 1000 907
407
800
400
300 323 347 330
300 600 493

200 400

100 200 41
8 6 3 7 9 5 12 6 7 5 5 12 5 5 10
0 0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 AutoCon ECAM JComCE JCEM CME

Total papers CP-related papers Total papers CP-related papers

Fig. 2a: CP-related papers in selected Fig. 2b: Published CP-related papers
journals for the period 1999-2009 in selected journals

Research Papers
No. Country Researchers
centres published
1 USA 20 60 44
2 China 8 24 18
3 Canada 2 16 16
4 United Kingdom 5 13 9
5 Australia 5 6 6

Table 1: Top 5 countries with most published papers

Times
Papers
Researcher Institution Country cited in
published
sample
Halpin, D.W. Purdue Univ. USA 5 109
AbouRizk Univ. of Alberta Canada 4 94
Thomas, H.R. Pennsylvania State Univ. USA 5 90
Martinez, J.C. Virginia Polytechnic Inst. & USA 1 44
State Univ.
Shi, J.J. City Univ. of Hong Kong China 5 38
Moselhi, O. Concordia Univ. Canada 3 23
Hanna, A.S. Univ. of Wisconsin-Madison USA 6 22
Zayed, T.M. Purdue Univ. USA 5 15
Marzouk, M. Concordia Univ. Canada 2 (1) 13
(Cairo Univ.) (Cairo)
Tam, C., M. City Univ. of Hong Kong China 4 9

Table 2: Top 10 researchers with most published papers

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4.2. Exploration of researchers’ stance

In the field of CP, the application of quantitative research dominates (60.7%),

followed by the mixed-method (29.2%) and the qualitative approaches (10.1%)
(Table 4). The quantitative approach is primarily associated with empirical research,
such as statistical analysis (Zayed and Halpin, 2005), artificial neural networks
(ANN) development (Tam et al., 2002) and fuzzy set analysis (Yang et al., 2003),
as well as simulation studies (Huang et al., 2004). Qualitative research is
implemented for archival analysis or empirical work within the framework of
questionnaire surveys (Rojas and Aramvreekul, 2003). Mixed-method research
stems from papers that combine empirical work (e.g. questionnaire surveys) or
archival study (e.g. document analysis) with quantitative modeling of productivity
data for the development of statistical models (Hanna et al., 2008) or the training
of ANN (Song and AbouRizk, 2008). Taking a more detailed view, Table 5 shows
that archival and empirical CP research is essentially equally focused on developing
experimental frameworks, improving data collection techniques and delineating
modelling methodologies, whereas the latter is almost the exclusive objective of
simulation studies (in 19 out of 25 cases).
Sampl
N Author/yea Publi- ISI
Title e
o r cation index
index
1 Martinez, J.C.
General-purpose systems for JCEM1,
& Ioannou, 9 48
effective construction simulation 125(4)
P.G. (1999)
2 Hajjar, D. &
Unified modeling methodology for JCEM,
AbouRizk, S.M. 6 33
construction simulation 128(2)
(2002)
3 Activity-based construction (ABC) JCEM,
Shi, J.J. (1999) 7 28
modeling and simulation method 125(5)
4 Hanna, A.S. et Impact of change orders on labour JCEM,
4 26
al. (1999) efficiency for electrical construction 125(4)
5 Impact of change orders on labour
Hanna, A.S. et JCEM,
efficiency for mechanical 5 23
al. (1999) 125(3)
construction
6 Thomas, H.R. Loss of labour productivity due to
JCEM,
6 20
et al. (1999) delivery methods and weather 125(1)
7 Cheng, T.M. &
An effective simulation mechanism AutCn2,
Feng, C.W. 1 19
for construction operations 12
(2003)
8 Thomas, H.R. &
Construction baseline productivity: JCEM,
Zavrski, I. 3 17
theory and practice 125(5)
(1999)
9 Zayed, T.M. &
Simulation of concrete batch plant JCEM,
Halpin, D.W. 4 17
production 127(2)
(2001)
10 Thomas, H.R. Schedule acceleration, workflow and JCEM,
2 17
(2000) labour productivity 126(4)
1
Journal of Construction Engineering and Management (ISI Impact Factor 0.564)
2
Automation in Construction (ISI Impact Factor 1.664)

Table 3: Most frequently cited papers

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Archival Empirical Simulation

Total
study research proposals

Quantitative 5 (5.6%) 26 (29.2%) 23 (25.9%) 54 (60.7%)

Qualitative 5 (5.6%) 4 (4.5%) 0 (0.0%) 9 (10.1%)

Mixed 8 (9.0%) 16 (18.0%) 2 (2.2%) 26 (29.2%)

Total 18 (20.2%) 46 (51.7%) 25 (28.1%) 89 (100%)

Table 4: Research classifications and categories

Experimental Data collection Modelling

Total
framework technique methodology

Archival 7 (7.9%) 5 (5.6%) 6 (6.7%) 18 (20.2%)

Empirical 16 (18.0%) 14 (15.7%) 16 (18.0%) 46 (51.7%)

Simulation 4 (4.5%) 2 (2.2%) 19 (21.3%) 25 (28.1%)

Total 27 (30.3%) 21 (23.6%) 41 (46.1%) 89 (100%)

Table 5: Research categories and method focus

The results of the analysis for every research category and the respective method’s
focus are as follows:
 Archival studies: The development of experimental frameworks is mainly
targeted at testing new models, validating existing ones and conducting
comparative analyses. Data collection techniques are implemented either in the
form of questionnaire surveys or standardized productivity registration forms.
Preferred modelling methodologies are the development of linear models, the
training of neural networks and the creation of historical databases.
 Empirical research: The experimental framework comprises laboratory tests,
passive observation, controlled experiments or multi-factor comparative
evaluations. Time studies, work sampling, time-lapse photography, image
analysis and specialized data elicitation instruments are the most commonly
used data collection techniques. Statistical or probabilistic modelling is primarily
deployed for processing the collected data.
 Simulation proposals: The experimental framework is almost exclusively
associated with discrete-event simulation. The data collection techniques are
similar to the previous categories (e.g. time-studies or questionnaires). The
modelling methodology is divided in the implementation of General Purpose
Simulation (GPS) platforms, such as STROBOSCOPE or EZStrobe (Marzouk and
Mosehli, 2003), and the utilization of Special Purpose Simulation (SPS) tools,
such as SIMPHONY (Mohamed and AbouRizk, 2005).
In terms of the researched productivity factors, the majority of the papers
investigated the effect of change orders, construction methods, personnel
management and weather on productivity (4 cases for each factor). The excavator
is the most frequently studied piece of equipment (4 cases) and excavation works is
the most common field of investigation (13 cases). Concrete operations and steel
fabrication works follow with 8 and 7 cases respectively. 19 building projects and
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17 earthmoving projects have been investigated, followed by industrial (9),

roadworks (5), bridge (1), tunneling (1) and reclamation projects (1).

4.3. Assessment of the UA requirement

Regarding the satisfaction of the UA requirement’s weak form, it should be noted

that all papers have been compiled by authors that are experienced and possess
the required “know how” to conduct CP research. As such, a useful indication would
be whether the findings have been used amongst construction practitioners.
Looking back at Table 3, it is fair to suggest that the papers with the most citations
amongst their colleagues are obviously deemed more useful. On the other hand,
the evaluation of the strong criterion satisfaction is difficult to be definitive
especially when only 35% of the papers have included a separate research
methodology section in the manuscript. For those papers, the danger of failing the
strong criterion seems to be two-fold: firstly, in qualitative surveys some authors
tend to generalize on the effect of specific factors on productivity by fitting the
practitioners’ responses to their own perceptions or those of previous research.
Secondly, in quantitative research some authors do not provide sufficient data
about the limitations in the productivity prediction capabilities of the developed
models, which can be particularly detrimental to the research validity especially in
the case of statistical regression models.

5. Discussion

This research had to overcome a number of limitations regarding the sample (e.g. it
may not be conclusively representative of the CP related research), the
documentation of the research methodologies within the papers (e.g. lack of
information, provision of superficial data) and the validity of drawing conclusions
based on a given number of sources (e.g. conference proceedings or any type of
reports were excluded from the analysis). However, several issues have emerged
from the analysis. Firstly, from an ontological and epistemological standpoint, CP
research is dominated by the objectivist and positivist stance. That is to be
attributed to the strong relation of productivity research to the natural science and
the traditional interest in investigating purely technical issues, such as project time
and cost. However, the multi-paradigm approach seems to be gaining ground,
especially given the industry’s shift towards intensifying the exploration of
productivity’s soft aspects as well, such as behavioural and managerial factors and
cultural diversions of the project actors. Secondly, the implementation of
methodological pluralism, as found in both empirical and simulation-based
productivity research, enhances the chance for minimizing the gap between the
“decided” methodology on behalf of the researcher and the “accepted” methodology
by the research community. That is to be achieved by following some basic
guidelines, such as (i) explicitly explaining the research methodology to be
followed, (ii) objectively reporting the research results, (iii) unambiguously
indicating the research’s adequacy and (iv) by practically demonstrating how the
selected methodology will serve the objectives in order for the research to provide
a clear contribution to the existing body of knowledge. Specifically, in qualitative
approaches it is critical to establish the theoretical framework prior to presenting
the research results, as productivity factors are multidimensional and can have a
different impact or meaning depending on the subjects being investigated. In
theoretically driven quantitative empirical work, the clarification of the experimental
framework (e.g. type of project and collected data, choice of modelling technique)
is vital to understanding the research limitations and thus protecting practitioners
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from implementing productivity estimation models that do not suit the project’s
situation. Finally, in mixed-method research paradigms, the forms or questionnaires
used for the collection of productivity data should be fully explained and excerpts
should be provided. In addition, data modeling should be clear on whether it is
related to daily or hourly productivity data or even cumulative productivity metrics.

The findings of the review can be utilized for the development of a methodological
framework that enables the empirical evaluation of the effect of selected factors on
productivity while facilitating the comparative analysis of the results. The
aforementioned guidelines combined with the review’s inferences indicate that such
a methodological approach should emphasize primarily on the description of the
activity under study, the level of abstraction, the construction technique and both
internal (e.g. managerial capability) and external influences (e.g. weather). The
ultimate objective should be the preservation of the research validity and the
establishment of a seamless methodology that could be repeatedly applied for the
exploration of differing productivity factors.

6. Conclusions

This paper has explored the role of research methodologies on construction

productivity studies. The main conclusion is that linking different methodological
aspects within an integrated research design will contribute towards overcoming
both the expected and subtle difficulties of conducting valid research. The
adherence to the formulated guidelines is expected to assist current and future
researchers in the area of construction productivity to generate research results of
grater acceptance by both Academics and Industrialists.

7. References

Abowitz, D.A and Toole, T.M. (2010), “Mixed method research: fundamental issues
of design, validity, and reliability in construction research”, Journal of
Construction Engineering and Management, 136(1), 108-116.
Dainty, A. (2008), “Methodological pluralism in construction management
research”, in: A. Knight and L. Ruddock (ed.), Advanced Research Methods in
the Built Environment, Wiley-Blackwell, New York.
Fellows, R. and Liu, A. (2002), “Research methods for construction”, Blackwell, UK.
Flood, I. and Issa, R.R.A. (2010), “Empirical modeling methodologies for
construction”, Journal of Construction Engineering and Management, 136(1),
36-48.
Hanna, A.S., Chang, C.K., Sullivan, K.T. and Lackney, J.A. (2008), “Impact of shift
work on labour productivity for labor intensive contractor”, Journal of
Construction Engineering and Management, 134(3), 197-204.
Harriss, C. (1998), “Why research without theory is not research”, Construction
Management and Economics, 16, 113-116.
Huang, R., Cheng, J. and Sun, K. (2004), “Planning gang formwork operations for
building construction using simulations”, Automation in Construction, 13, 765-
779.
Martinez, J.C. (2010), “Methodology for conducting discrete-event simulation
studies in construction engineering and management”, Journal of Construction
Engineering and Management, 136(1), 3-16.

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Marzouk, M. and Moelhi, O. (2003), “Object-oriented simulation model for

earthmoving operations”, Journal of Construction Engineering and Management,
129(2), 173-181.
Mohamed, Y. and AbouRizk, S.M. (2005), “Framework for building intelligent
simulation models of construction operations”, Journal of Computing in Civil
Engineering, 19(3), 277-291.
Rooke, J.A. and Kagioglou, M. (2007), “Criteria for evaluating research: the unique
adequacy requirement of methods”, Construction Management and Economics,
25, 979-987.
Rooke, J., Seymour, D. and Crook, D. (1997), “Preserving methodological
consistency: a reply to Raftery, McGeorge and Walters”, Construction
Management and Economics, 15, 491-494.
Seymour, D., Crook, D. and Rooke, J. (1997), “The role of theory in construction
management: a call for debate”, Construction Management and Economics, 15,
117-119.
Song, L. and AbouRizk, S.M. (2008), “Measuring and modeling labor productivity
using historical data”, Journal of Computing in Civil Engineering, 134(10), 786-
794.
Tam, C.M., Tong, T.K.L. and Tse, S.L. (2002), “Artificial neural networks model to
predicting excavator productivity”, Engineering, Construction and Architectural
Management, 9(5/6), 446-452.
Yang, J., Edwards, D.J. and Love, P.E.D. (2003), “A computational intelligent fuzzy
model approach for excavator cycle simulation”, Automation in Construction,
12, 725-735.
Zayed, T.M. and Halpin, D.W. (2005), “Pile construction productivity assessment”,
Journal of Construction Engineering and Management, 131(6), 705-714.

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AA044
Factors influencing Project Risk Management Decision Making

Papadaki M.,
(Enterprise Risk Management Professional/Researcher, Rolls-Royce plc-The
University of Manchester, Derby, UK)

Gale A. W.,
(Professor, School of Mechanical, Aerospace and Civil Engineering, The
University of Manchester, UK)

Rimmer J.,
(School of Mechanical, Aerospace and Civil Engineering, The University of
Manchester, UK)

Kirkham R. J.,
(School of Mechanical, Aerospace and Civil Engineering, The University of
Manchester, UK)

Abstract
Most investment decisions are characterized by irreversibility and uncertainty about
their future rewards. Understanding the nature and magnitude of cost overruns in
projects is often considered to be one of the most important challenges facing
project managers. The application, therefore, of Project Risk Management (PRM) is
widely regarded as in important skill-set in a PM’s portfolio. Today’s highly volatile
economic environment presents new challenges for those seeking to develop robust
strategies to respond to events that are likely to impact project budgets. This paper
reports on an ongoing doctoral research project in collaboration with Rolls-Royce
PLC. The project aims to explore opportunities for improving the management of
budget contingency in relation to effective corporate risk management strategy.
Initial findings suggest that senior managers recognise the importance of an
effective risk management process. However, there is a great opportunity of
improving the process of how risk management data can and should be used. Two
projects were studied with respect to major difference in the use of risk data.
Findings indicate the importance of a top-down risk management approach. The
awareness of senior managers needs to be increased. To do this, risk has to be
translated into profit through budget contingency.

Keywords
Risk Management, Budget Contingency, Decision Making

1. Introduction

The recent global economic crisis is one of the main factors contributing to the
increased focus on risk management by the organisations. It is important to note
that practitioners realise that an effective risk management process increases the
chance of an organisation successfully achieving its objectives. Risk management is
a process that can make a significant contribution to the implementation of better
strategic decisions through the appropriate use of risk management data. It was
encouraging to find that many organisations change their attitude to risk
management. A good example came from Australia where “… the Corporate
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Governance Council of the Australian Stock Exchange (ASX) has set guidelines for
Risk Management within public listed organisations and the board of directors is
seen to hold the primary responsibility over the establishment and the
implementation of a proper risk management system” (Subramanian et all., 2009).
The research reported in this paper investigates possible improvements to the
effectiveness of the treatment of risk. It is believed that with better use of the risk
management data practitioners will explore the opportunity for more effective
decision-making process. The investigation of the area of budget contingency
management plays a central role in the translation of risk into profit.

2. Literature Review

2.1 Risk and Risk Management Process

Risk is a threat or an opportunity that could affect positively or negatively the

project success. The Project Management Institute (PMI) and Association for Project
Management (APM) define risk in terms of threats and opportunities faced by a
project.

“An uncertain event or condition that, if it occurs, has a positive or negative effect
on a project objective” (PMBOK, 2000, p. 127).

“An uncertain event or set of circumstances that, should it occur, will have an
effect on achievement of one or more project’s objectives, with the clear
understanding that risk can affect achievement of project objectives either
positively or negatively” (APM, 2006, p. 26).

In general, unexpected events occur at any point in time during the life cycle of a
project, having either positive or negative impacts on project objectives. According
to Williams (1995) cited in Ahmed et al., (2007, p.23) “Positive outcomes are
opportunities while negative outcomes generate loss. Risk focuses on the avoidance
of loss from unexpected events”. The authors decided to adopt a wider definition of
risk, which is described as project uncertainty management. “Uncertainty
management is not just about managing perceived threats, opportunities and their
implications. It is about identifying and managing all the many sources of
uncertainty, which give, rise to and shape our perceptions of threats and
opportunities. It implies exploring and understanding the origins of project
uncertainty before seeking to manage it, with no preconceptions about what is
desirable or undesirable” (Ward & Chapman, 2003, p.98). There are many different
views on how a risk management process needs to be implemented within an
organisation. A general definition of risk management as a process is given by
Thevendram and Mawdesley (2003, p.131):
 Risk identification
 Risk analysis
 Risk Response
 Risk Monitor (Feedback)
Based on the environment within which organisations operate the authors
developed the following model for the risk management process. The model
comprises five core steps.
 Step 1 Risk Identification: Risks are identified through various tools and
techniques

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 Step 2 Risk Analyses: Risks are analysed through various tools and
techniques
 Step 3 Risk Response/Treatment: risks are mitigated, transferred, accepted
or rejected. Following this response to risks, planned treatment activities
need to be included in the budget and contingencies set to address any
residual risk.
 Step 4 Allocation of Budget Contingencies and Management: Risk response
and treatment must be cost effective, meaning that the overall cost of a
project must be reduced when considering the additional cost of the
treatment and the reduced contingency requirements. The contingency
assigned to risks that do not occur could be released to profit. In this way
senior managers understand risk management in terms of profitability. “The
holding of budget contingency at the project level to be released to address
specific risks if they occur is more likely to result in project success”
(Papadaki et. al., 2008).
 Step 5 Risk Monitor and Controlled: risk mitigation strategies and plans are
continuously monitored, updated and controlled. It is important to note that
the risk management process is a continuous loop throughout the project
lifecycle. The lessons learned database gathers historical data from each of
the cycle loops. It is also a database for communication those responsible for
risk. The lessons learned database could be a tool for using risk management
data from the treatment stage and for the decision making process.

Fig 1: Risk Management Process

2.2 Risk Governance

According to Merna and Al-Thani (2005) an organisation is divided into three levels:
corporate, strategic business and project levels. Corporate level refers to the
corporate management of the organisation where strategic decisions are made to
meet goals and objectives of the organisation. Corporate level is concerned with
risks that are associated with the overall position of the organisation in the market
segment. These risks are political, financial, legal, environmental and global.
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Strategic business level is concerned with risks such as economic and market risks.
However, project risks are specific to the achievement of project objectives. Figure
2 illustrates how the organisation is compose of three levels and can be used as the
basis for the risk management process.
Risk management can be undertaken using an upward (bottom-up) or downward
(top-down) approach at each level of the organisation. In the upward (bottom-up)
approach risk management starts from project level and flows upward to corporate
level. The downward (top-down) approach starts at the corporate level and
promulgates downwards towards project level. It is believed that the first approach
is more detailed. However, in terms of effectiveness the downward approach gives
a more positive impetus to the organisation. This is because risk management as a
process needs strong leadership, usually found in the upper levels of an
organisation. It is also inevitable that the upper levels have the ability to influence
more people to use risks management and use it as a tool for decision-making and
not an as administrative tool, considered as extra work by employees. The process
explained previously (Figure1) could be used at each level of the organisation,
whereas in the corporate level risk management is focused on strategic risks.
Strategic business is focused on cost effectiveness and on potential projects. The
project level considers risks associated with achieving project objectives.

Fig 2:Risk Management and organisational structure

Budget Contingencies and Culture

Improving contingency management requires an understanding of how managers

use budget contingency and how they make decisions in relation to budget
contingency. When a project starts and the initial plan is created, if it is undertaken
prior to any risk management, it will carry a significant amount of risk for which
contingency funds should be identified and held. As risk management is undertaken
the committed cost of the project will increase and the risk, hence contingency, will
reduce. If risk management is carried out effectively then the cost of undertaking
mitigation actions will be significantly less than the reduction in contingency
requirements and the overall cost of the project (budget plus contingency) will fall.
As risk mitigation progresses mitigation actions demonstrate diminishing returns.
The art of good risk management is to ensure that the decisions taken in the
treatment stage minimise the total project cost.

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Cost

Total project cost

Minimum
Total Cost
Contingency

Committed cost Additional mitigation costs more

(Budget) than the reduction in contingency

Optimum plan Planned activities (committed)

Basic plan (no recognition of risk)

Fig 3: Budget Contingencies

3. Research Project

Recent studies indicate that there is room for improvement in the effectiveness of
the treatment of risk. Many practitioners experience difficulties in the use of the risk
management data. The research project reported in this paper investigates possible
improvements in the effectiveness of the treatment of risks. The main objectives
are as follows:
 Identify the current practice in relation to the development of contingency
budgets;
 Identify current practice in the treatment of risk;
 Suggesting possible ways of improving the effectiveness of treating risks.

3.1 Research methodology

The research reported in this paper forms only one part of a larger research
project. The project tries to identify room for improvement in the treatment of risk.
It focuses on four basic areas:

 Risk management and organisational culture

 Risk assessment and treatment
 Contingency management
 Risk management effectiveness

The first stage of this research was a semi-structured interview survey (n=17)
administered to key programme/project executives on two programmes. The semi-
structured interview survey led to the development of a questionnaire survey
administered to a broader population (n=74). Questionnaires were distributed to all
of the management levels from project executives to Integrated Project Team
leaders. Respondents were asked to answer four types of question. The first one
used a five point Likert type scale. Likert-scale questions can be used to measure
the level of agreement to a statement, starting from “strongly disagree” to
“strongly agree”. There were also closed questions, which required respondents to
answer “Yes”, “No” or “Don’t Know”. It is important to note that both of the above
question types require only one answer. In contrast, the third question type
(multiple response) invited respondents to check as many answers as they wanted.
Finally, open questions were used. This type of question does not provide a set of

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answers; rather it gives the opportunity for the respondents to simply describe a
problem in their own words.

The questionnaire instrument contained five parts. The first part gathered
information about respondent’s general background such as, project name and
location, project role. The second part investigated the risk management
organisational culture. It was divided into 13 mixed questions. The third part
concentrated on risk assessment and treatment and contained 18 mixed questions.
The next part explored the area of contingency budget and management within
projects/programmes and employed 11 mixed questions. Finally, 12 mixed
questions assessed the overall risk management effectiveness. All questions
presented in this paper correspond to the second part of the questionnaire, which
concerns with the risk management and organisation culture.
Data gathered were non-parametric. This is due to many factors such as: Likert-
scale questions referred as ordinal data. Ordinal Data are qualitative data, which
are more than two categories in a logical order (12345 Likert-scale) and is often
considered as non-parametric.
Possibly, skewness and kurtosis give a reasonable indication of the style of sample
distribution (Kerr et al., 2002) The combinations of the one-tail or two-tail Z2 and
Z3 tests can be useful in testing normality against the constrained skewness and
kurtosis (Mudholkar et al., 2002). Normality of data was tested using various
statistical and visual methods and the results unanimously revealed the data to be
non-normal. The implication of these results is that a non-parametric approach to
data analysis is adopted in this work. The statistical tests were used: descriptive
analysis (mean and standard deviation) Mann-Whitney test and Kruskal Wallis-test
(for detecting statistical significance between groups).

4. Results

The first question asks the respondents to identify the level of importance that risk
management has to their organisation. Respondents had to choose between the
following statements: not important, somewhat and very important. Initial data
indicate that the respondents believe it is important for practitioners to be engaged
in an effective risk management process, whereas 83% of respondents believed
that for an organisation it is very important to adopt an effective risks management
process. In terms of educational background, 100% of practitioners with both an
engineering and business background believe that effective risk management is
very important for an organisation (Figure 4). However, this was also tested by
Krustal-Wallis and the difference between all the groups is not statistically
significant.
Risk Management Level of Importance

120%
100%
100% 82% 80% 75%
80%
Somewhat
60%
Very Important
40% 25%
18% 20%
20%
0%
0%
Engineering Business Engineering& Other Sciences
Business
Educational Background

Fig 4: Risk Management Level of Importance

(Based on Educational Background)
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The following question asked the respondents to express their approval or

disapproval relating to the following statement “effective risk management can
improve business performance at your organisation”. Most of the respondents
(approximately 73%) strongly agreed that effective Risk Management can improve
business performance of the organisation. Both results show perceptions about risk
management shifting in a very positive manner. This helps organisations to use and
explore more the risk management process.

The authors attempted to identify any significant difference in the risk management
process between the projects studied. Therefore, a question was developed which
asked for respondents’ perceptions on whether there were any tangible benefits
from risk management on their project. Further, analysis of responses indicates
that there is a possibility that in projects where risk management is undertaken
more rigorously respondents have identified more tangible benefits. Comparisons
between the responses given by practitioners from the two projects studied (A and
B) showed that there is a major difference in practitioner perceptions towards
tangible benefits between the projects studied.

Results show that project B has seen more tangible benefits from the application of
the risk management process in their project/programme (>85%), whereas in
project A the majority only agree or are neutral (p<0.05). This difference between
the projects could be due to many factors. It is important to note that in project B
there is a dedicated risk manager responsible for ensuring the process in applied
effectively, in contrast to project A that followed a more traditional risk
management process. Furthermore, risk management seems to have more positive
results when it is led from a top-down approach. From the interview survey it was
identified that the senior management team in project B had explicitly supported a
more rigorous application of the risk management process, and the senior
management required the lower levels in the organisation to explicitly demonstrate
compliance with the process. Governance plays a vital role. It could be said that a
positive domino effect could result when the seniors are more dedicated to and
support the idea of an effective risk management process. It is important to note
that risk management requires practitioners to undertake extra work and most of
them do not see the benefits directly. Therefore, seniors in the early phases of a
project must drive the implementation of an effective risk management process
through all levels of the project.

Project A shows an opportunity of developing a more effective use of risk

management data process. Project B had introduced well defined methods for using
the risk data to inform decisions regarding the assignment of contingency funds.
The fact that risk could be attached to budget contingency (Project B) made the
practitioners recognise the relationship between risk and project costs (in monetary
terms). For this matter, in the fourth part of the questionnaire a question was
developed in order to see if contingency budget is directly related to some big risks
in projects.

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5. Conclusions

In cases where a top-down approach to risk management is used the results appear
more positive. Risk management must not only be seen to be considered important
by senior management but they should also understand how to make best use of
the information generated by the risk management process. In order to increase
the awareness of the benefits of risk management among top executives it is good
practice to promote education and training for senior managers. This has been
shown to increase their ability to use risk management effectively. Generally, the
importance of risk management appears to be recognised across the organisation.
This is encouraging and indicates that the organisation is working towards
continuous improvement compatible with the current economic environment. It is
believed that seniors recognise the need for a structured risk management process.
However, there is an opportunity of improving the process of how to use risk
management data more effectively. Most of the times lower levels of an
organisation see the risk management process as something that they must follow,
but from which they get little benefit. The following conclusions are important for a
more effective risk management approach.

 Senior managers need to recognise the importance of an effective risk

management process. The results show that irrespective of education
background, over 75% agree that it is important.
 It is necessary to introduce new ways of using risk management Data. For
example, linking risk management to budget contingency management: a
way of converting risk to profit. New, non-traditional, approaches to risk
management by one project showed that risk data can be translated into
monetary terms and can help practitioners deliver a more effective decision
making process.
 Risk management needs to be lead by senior managers through a top-down
approach, requiring an effective risk management process lower down the
organisation. One project explicitly supported a more rigorous application of
the risk management process and senior management required
demonstrable compliance.
 A dedicated risk manager providing focus and drive adds to project success.
Practitioners found more tangible benefits (over 85%) in projects where a
risk manager was identified.

6. References

APM Association for Project Management (2006) “Project Risk Analysis &
Management (PRAM) Guide”, (5th edition), APM Publishing, High Wycombe,
Bucks, UK
Ammar Ahmed, Berman Kayis, Sataporn Amornsawadwatana (2007) “A review of
techniques for risk management in projects”, Emerald Group Publishing Limited
14(1),pp 22-36
Kerr, A. W., Hall, H. K. & Kozub, S. A. (2002) “Doing Statistics with Spss”,
Thousand Oaks, Sage, California
Merna, T and Al-Thani, F.F (2005), “Corporate risk management: an organisational
perspective”, John Wiley & sons, Chichester

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Mudholkar G.S., Marchetti C.E., Lin C.T. (2002) “Independence characterizations

and testing normality against restricted skewness-kurtosis alternatives”, Journal
of Statistical Planning and Inference, 104 (2), 485-501.
Papadaki M, Gale A W, Rimmer J, Ganna M. (2008) "Investigating the relationship
between budget contingency, project risk management and profit", 22nd IPMA
World Congress, Rome,
PMBOK (2000). “A guide to the project management body of knowledge”. Project
Management Institute, Newton Square, Pennsylvania, USA.
Subramaniam, N. McManus, L. and Zhang, J. (2009) “Corporate governance, firm
characteristics and risk management committee formation in Australian
companies”, Managerial Auditing Journal, 24(4), 316-339
Thevendram V. and Mawdesley M.J., (2004), “Perception of Human Risk factors in
construction projects: an exploratory study”, International Journal of project
management, 22(2),131-137
Ward, S. C. and Chapman, C. B. (2003), “Transforming project risk management
into project uncertainty management”. International Journal of Project
Management, 21(2), 97-105

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AA121

Collaboration Procurement Methods in Construction Projects-Greek

Construction Industry Clients’ Perspective

Theofilos Papadopoulos
(MSc., Hellenic Open University, Patras, Greece)

John - Paris Pantouvakis

(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Abstract
Traditionally the construction industry characterized by adversarial relationships,
the lack of cooperation among project participants and the fact that construction
companies and clients focus mainly on the reduction of project cost and neglect the
value, are some reasons for the poor performance of construction projects. This
research aims to investigate the Greek construction industry, from clients’
perspective, in order to present the most common project delivery methods used,
the problems faced, the usage of collaborative tools and the motivation factors that
could lead clients to establish collaborative relationships. The empirical data were
collected through a questionnaire to a population of 19 Greek Construction clients’.
Findings confirm the traditional method’s extensive usage in Greek construction
industry both from public and private firms/organizations. As a result the problems
that are reported are similar with the common problems that characterized
traditional procurement method. This paper suggests that although Greek
construction clients are familiar to some extend with collaboration tools and have
some knowledge of the benefits of collaboration in project performance, they need
strong incentives, such as cost reduction, to establish collaboration relationships.

Keywords
Construction, Procurement, Project delivery, Collaboration, Greece

1. Introduction

The relationships between contractors and clients are mainly dominated by poor
collaboration, limited trust, contract unbalanced risk allocation, and limited
customer focus as a result of competitive procurement procedures (Saad et al
(2002)), (Eriksson and Westerberg (2010)). Traditional construction procurement
methods have often been criticized for being incapable of delivering projects
according to cost and time requirements and at their maximum value (Eriksson and
Laan (2007)), (Latham (1994)). Collaborative procurement introduces a different
working culture that is based on the restructuring of the relationships between
project participants and especially between construction firms and clients. Such
relationships improve coordination and flexibility, which is often beneficial in
construction projects (Pesamaa (2009)), (Egan (1998)), (Bresnen and Marshal
(2000)). However there is a lack of empirical research in Greek construction
industry concerning collaborative relationships in project delivery.
The aims of this paper are to:
 Identify the most common project delivery method and
tendering procedure in Greek construction industry.
 Recognize the main problems concerning project delivery.
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 Present the level of usage of collaborative tools.

 Determine the recognition of benefits in project performance.
 Recognize the incentives that could motivate owners to establish
collaboration relationships.

The present research is conducted as part of dissertation for the MSc

Construction Project Management course of Hellenic Open University.

2. Research Methodology

The choice of the methodology was determined by the need to capture the views of
managers or directors, who work for construction client’s firms/organizations, on
the adoption of collaborative relationships during project delivery. The empirical
data were collected through a questionnaire to a population of 19 Greek
Construction clients’. The population consists of regional (11%), national (42%)
and international (16%) companies, municipalities (16%) and also government
services and agencies (16%), which procure construction work. Hence, this
population provides a suitable representation of Greek construction clients sector.
Respondents were mostly procurement managers, project managers or directors of
the construction and facilities department in their organizations.
The questionnaire contained two types of closed questions, rating scales and
“forced choices” allowing for a variety of individual responses. There were two
sections. In the first section there were four “forced choices” closed questions
where the targeted respondents were asked to give data about their own
experience, the profile of their own firm/organization in terms of size and type of
projects undertaken and the type of delivery methods and tendering procedures
they use most frequently on the majority of their projects. The second section
contained four (4) composite questions requiring between 6 and 8 responses. The
respondents were asked to score the responses using 5-point Likert-style rating
scale with a score of 5 indicating very important/very often and a score of 1
indicating unimportant/not at all. They were asked about the problems they usually
face during construction projects delivery and to what extent do they use different
tools/methods for increasing cooperation among the different participants in the
construction process. Also they were asked about the influence of collaborative
tools in project performance and the reasons that make them establish
collaborative relationship with one or more project participants, in a win-win
attitude.

3. Results and Analysis

The most commonly used project delivery method, according to respondents, is the
traditional method at 79% of all responses. Construction management (11%) and
Design-Build (5%) were rated far lower. Traditional method is almost the exclusive
delivery method for the public sector (100%). For private sector firms, traditional
method is still very popular (69%) but the other two methods are used as well. As
far as the tendering procedures concerns, when traditional method is used, limited
bid invitation and open bid rated 47% and 42% respectively, much higher than
negotiation (12%). Consequently, based on the above findings, the predominant
project delivery method in Greece is the traditional for both public and private
sectors. The usage of this method is almost exclusive in public sector due to law
and policy restrictions. In private sector it is used mainly because companies and
managers are more familiar with this method.
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As demonstrated in Fig. 1 the most commonly faced problems are design changes
(3.7) during construction and time (3.6)/cost (3.7) overruns. Quality and post
construction problems along with problems based on relationship (lack of trust and
conflicts/disputes) are on the same level (3.2) of frequency. The main characteristic
of design-bid-build (DBB) procurement method is that design stage is separated
from construction stage. The client is responsible for the specification of the product
then performs detailed design work before contractors are procured, in order to
develop a solid base for competitive bidding. The separation of design and
construction, the lack of coordination and integration, are the important impact
factors causing performance-related problems, such as low productivity, cost and
time overruns, conflicts, and disputes (Allensworth, (2009)). The divorce between
design and construction leads to problems such as design changes during
construction, as contractor doesn’t participate in design stage. This separation also
results in long project durations. Consequently, it can be easily seen that problems
that clients’ faced are closed related with project procurement method. Early
collaboration between the design team, owner, and the construction community has
many benefits in the later performance of the project (Latham (1994)), (Xue et al
(2005)). The participation of contractor or even suppliers and subcontractors as
integrated project team will enhance collaboration and transfer of experience at the
design stage. Cost and time overruns are affected not only from the design
construction separation but also from the nature of sequential and linear process of
traditional method, preventing overlapping of tasks which could lead to time and
money savings.
5,0

4,5

4,0

3,5
Mean Value

3,0

2,5

2,0

1,5

1,0
1 2 3 4 5 6 7

Question1: During construction project delivery how often do you face:

(1: Very seldom….5: Very often)
1 Lack of trust with contractor
2 Conflicts and disputes with contractor
3 Design changes during construction
4 Poor quality in construction output
5 Cost overruns
6 Time overruns
7 Post-construction operational problems

Fig 1: Mean Value of 5-point Likert scale answers (Question 1)

In the questionnaire the respondents were asked about the usage of collaborative
tools in construction projects. From the results the most commonly used
collaborative tools are follow up meetings (3.9) and integration team creation (3.6).
On the other hand early involvement of contractor (2.5) is the least used practice.
Shared risks among client (2.9) and project participants are not popular. This could
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be easily predicted if you took into account the protection that contract agreement
provides to owner during traditional method. Also in Fig 2 can be seen that conflict
resolution process is the third most common collaboration tool (3.5) probably as
part of contractual agreement of traditional method. To sum up, clients are familiar
with some collaboration tools. Shared project risks and mutual goals and objectives
are practices of high importance which have low usage. On the other hand
integrated team creation and follow up meeting’s popularity reveal the potential for
collaboration establishment.
5,0

4,5

4,0

3,5
Mean Value

3,0

2,5

2,0

1,5

1,0
1 2 3 4 5 6

Question 2: How often do you use the following collaborative tools?

(1: Very seldom….5: Very often)
1 Integrated team creation
2 Mutual goals and objectives
3 Follow up meetings
4 Early involvement of contractor
5 Conflict resolution process
6 Shared project risks

Fig. 2: Mean Value of 5-point Likert scale answers (Question 2)

Fig. 3 depicts the respondents view about collaborative tools effect on project
performance. It can be seen that respondents view is positive and in accordance
with the literature review that mentioned the positive influence on project
performance that cooperative procurement procedures have (Pesamaa (2009)).
According to answers, long term relationships (4.3) and shared project risks (4.1)
are the most common factors that affect mainly project performance. In general
respondents recognise the importance of collaborative tools.

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5,0

4,5

4,0

3,5

Mean Value
3,0

2,5

2,0

1,5

1,0
1 2 3 4 5 6

Question 3: How much do you believe the followings can affect project performance?
(1: Not at all….5: Very much)
1 Early involvement of contractor
2 Long-term relationship with contractor
3 Shared project risks
4 Conflict resolution process
5 Collaborative relationship with contractor
6 Use of incentives/bonus in order to achieve specific objectives

Fig. 3: Mean Value of 5-point Likert scale answers (Question 3)

5,0

4,5

4,0

3,5
Mean Value

3,0

2,5

2,0

1,5

1,0
1 2 3 4 5 6 7 8

Question 4: How easily would you establish collaborative relationship with one or more
project participants (in a win-win attitude) in order to:
(1: Not at all….5: Very much)
1 Deliver reliably project with budget and timetable maintained
2 Reduce project life cycle cost
3 Reduce conflicts and disputes
4 Share project risks
5 Increase opportunity for innovation
6 Achieve higher quality of construction
7 Establish mutual trust between project participants
8 Achieve cost savings
Fig. 4: Mean Value of 5-point Likert scale answers (Question 4)
Finally, according to Fig. 4, the basic motivation factor for clients in order to drive
this change is the cost reduction. Both project life cycle cost reduction (4.2) and
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project cost savings (4.1) are factors that respondents believe could drive them.
This means two things: a) firstly in order to introduce more collaborative project
procurement methods, such as construction management or integrated project
delivery, the owner should be convinced that this change would lead to cost
reduction, b) secondly this shows that owners are not convinced that collaboration
leads to cost reduction, as literature review and plenty of case studies reveal. Other
major incentives for the owner are quality (4.1), conflict and dispute reduction
(3.9) and goal sharing (3.9).

4. Conclusions

The research revealed the extensive usage of the traditional procurement method
in Greek construction industry. The common use of limited bid tendering procedure
shows the recognition of benefits that offers the establishment of long term
relationships between client-contractor. The problems mentioned above are
basically problems that characterized the traditional method. Time and cost
overruns along with design changes come from design and construction stage
separation. As far as collaborative tools usage is concerned, the respondents are
familiar with tools which are used during project delivery process like follow up
meetings, project team formation and conflict resolution process. Collaborative
practices such as shared project risks and mutual goals and objectives are tools of
high importance with low usage. Finally the research reveals the respondents
positive view about the benefits of collaboration in project performance and the
incentives that motivate clients to establish collaboration relationships which is
nothing more than cost reduction. If construction industry’s clients convinced that
collaboration procurement methods and relationships results in cost reduction, that
would motivate them in order to adopt concepts like partnership and supply chain
management in project delivery process.

5. Acknowledgements

The work presented in this paper originated as part of a dissertation for the MSc Degree of
Construction Project Management at the Hellenic Open University undertaken by the first
author and supervised by the second. Gratitude is also due to those that have responded to
the survey performed.

6. References

Allensworth, W., Altman, R., Overcash, A. and Patterson, C. (2009), “Construction

Law”, Forum on the Construction Industry ABA Publishing, USA
Bresnen, M. and Marshall, N. (2000), “Building partnerships: case studies of client
contractor collaboration in the UK construction industry”, Construction
Management and Economics, 18(7), 819–32.
Bresnen, M. and Marshall, N. (2000), “Partnering in construction: a critical review
of issues, problems and dilemmas”, Construction Management and Economics,
18 (2), 819–832.
Bresnen, M. and Marshall, N. (2002), “The engineering or evaluation of
cooperation? A tale of two partnering projects”, International Journal of Project
Management, 497–505.
Egan, Sir J. (1998), “Rethinking Construction”, Department of Trade and Industry,
London.

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Eriksson, Ε. and Laan, A. (2007), “Procurement effects on trust and control in

client-contractor relationships”, Engineering Construction and Architectural
Management, 14 (4), 387-399.
Eriksson, Ε. and Westerberg, M. (2010), “Effects of cooperative procurement
procedures on construction project performance: A conceptual framework
International”, Journal of Project Management, in press (online since 23-Feb).
Fewings, P. (2005), “Construction Project Management, An integrated Approach”,
Taylor & Francis, USA.
Latham, Sir M. (1994), “Constructing the Team: Final report; joint review of
procurement and contractual arrangements in the United Kingdom construction
industry”, H.M.S.O, London.
Masterman, J W E. (1996), “Building Procurement Systems: An Introduction”, E &
FN Spon, London.
Naoum, S. (2003), “An overview into the concept of partnering”, International
Journal of Project Management, 21, 71–76.
Pesamaa, O., Eriksson, P. E. and Hair, J. (2009), “Validating a model of cooperative
procurement in the construction industry”, International Journal of Project
Management, 27, 552–559.
Saad, M., Jones, M. and James, P. (2002), “A review of the progress towards the
adoption of supply chain management (SCM) relationships in construction”,
European Journal of Purchasing & Supply management, 8, 173-183.
Xue, X., Li, X., Shen, Q. and Wang, Y. (2005), “An agent-based framework for
supply chain coordination in construction”, Automation in Construction, 14,
413-430.

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AA045

A framework for the implementation of a knowledge management

platform in the Greek construction industry

Eleni Papari
(Researcher, Centre for Construction Innovation, National Technical University of
Athens, Athens, Greece)

John-Paris Pantouvakis
(Associate Professor, Centre for Construction Innovation, National Technical
University of Athens, Athens, Greece)

Antonios Panas
(PhD Candidate, Centre for Construction Innovation, National Technical University
of Athens, Greece)

Abstract
Contemporary construction organisations realise that managing the acquired
knowledge in a more structured manner results in considerable improvements in
their working practices and business performance. This paper describes a
framework for establishing a knowledge management strategy for construction
projects adapted to the Greek construction paradigm. A brief comparative analysis
of recent knowledge management models is presented followed by a discussion of
the research methodology. The study identified the informational requirements of
current knowledge capture mechanisms and developed a knowledge management
tool for construction projects. The tool’s structure and data requirements are
explained. A case study in a Greek design company helped to establish the
applicability of the approach. A preliminary evaluation of the knowledge
management tool by the end-users suggests that it is a useful template for the
systematic capturing and storing of useful knowledge. The main inference emerging
from the study is its contribution to the creation of a company-specific knowledge
base for future reference, so as to solve recurring problems pertaining to the
construction process.

Keywords
Construction, Database, Framework, Knowledge management, Platform

1. Introduction

In the project-oriented construction industry knowledge is generated at every

phase of the project development process (El-Gohary and El-Diraby (2010)).
Therefore, capturing and reusing the knowledge that is created during and after the
project implementation is a key challenge posed to contemporary construction
organisations (Udeaja et al. (2008)). This necessity has lead to the development of
Knowledge Management (KM) as an emerging topic in construction, especially
within the last two decades. However, an important prerequisite for the formulation
and implementation of an effective KM strategy is its alignment with the company’s
strategy and objectives (Kivrak et al. (2008)). The realization of a KM strategy
within a construction organisation is supported by the application of specific tools,
such as computer-based systems or web-based platforms (Zhang et al. (2009)). In
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that view, this paper aims at developing a knowledge management tool adapted to
the Greek construction paradigm. A database management system is developed
that aids construction operatives to store and reuse project knowledge. Entries
include, inter alia, details of project actors, concise project descriptions as well as
specific registration of events relating to the project’s “lessons learned”. The tool
differentiates from similar efforts in that it enables knowledge capture regarding the
legal framework of the project in hand, which is of particular importance to the
Greek construction paradigm.
The paper begins with a brief review of research pertinent to knowledge
management followed by a brief review of four recently presented KM models.
Subsequently, a description of the adopted methodological approach is provided.
The paper then goes on to analyze the development of the knowledge management
platform followed by a discussion of its main characteristics. The results of the
platform’s applicability evaluation are presented and the paper concludes by
scrutinizing the emerging implications of the study.

2. Theoretical background
2.1 Defining knowledge

Knowledge can be considered as the product of learning and can be seen under
different perspectives or contexts personal to an individual or organisation
(Liyanage et al. (2009)). The foundation of current knowledge management is
traced back to the work of Michael Polanyi in the late 1960’s (Grant (2007)), who
categorized knowledge in two basic categories: tacit and explicit. Tacit knowledge is
highly personal and context-specific. It resides in human brain and cannot be easily
captured or codified (Liyanage et al. (2009)). On the other hand, explicit knowledge
can be codified in words and numbers, easily shared in manuals and distributed
amongst individuals (Payne and Sheehan (2004)). Based on this categorization,
Nonaka and Takeuchi (1995) defined four ways for capturing and transferring
knowledge (Fig. 1). Socialisation denotes the conversion of tacit knowledge to new
tacit knowledge through shared experience, such as face-to-face meetings.
Externalisation results in tacit knowledge transforming into explicit by formal or
informal modes (e.g. project management team meeting minutes). In the case of
combination, explicit knowledge is combined and implemented in a more complex
form as a result of team work amongst the project’s participants (e.g. schematics
are combined to produce detailed drawings). Finally, the internalisation approach
happens when explicit knowledge is captured and shared within the organisation
and then converted into tacit knowledge (e.g. utilizing the results of a simulation
study to redesign a building’s structural elements).

Tacit
Tacit Tacit
Explicit

Socialisation Externalisation
Sharing tacit knowledge Articulating tacit knowledge
through direct contact through social interaction

Internalisation Combination
Embodying and acquiring Connecting and applying
new tacit knowledge explicit knowledge

Explicit
Tacit Explicit
Explicit

Fig 1: Modes of knowledge transfer (adapted from Nonaka and Takeuchi (1995))
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The model of Nonaka and Takeuchi (1995) has been criticized as to whether it
contradicts with Polanyi’s perception that tacit knowledge cannot be formalized and
transformed since it is strictly subjective (Grant (2007)). However, it has been
widely utilized within the KM community and formed the basis for the development
of KM models in construction, as will be described in the next section.

2.2 Knowledge management in construction

Knowledge management in construction is essential for improving the business

performance and creating a competitive advantage for organisations (Kivrak et al.
(2008)). Key benefits of KM in construction are the integration of the project
development process (El-Gohary and El-Diraby (2010)) and the establishment of a
knowledge base of historical data that can be used in future projects (Kiziltas and
Akinci (2009)). Different models and tools have been developed so as to enable the
implementation of a KM strategy for construction projects. The following paragraph
reviews four recently presented KM models, which have been developed according
to the conceptual model presented in Fig. 1, discusses its main features and
compares their characteristics.
The first KM model is based on a conceptual framework (ProFIK) that defines a
process map for transferring knowledge within and across construction projects
(Liyanage et al. (2009)). It focuses on the source (e.g. construction organisations)
and the receiver (e.g. team of engineers) of knowledge and covers all
organizational levels, from the individual to the team. The second model integrates
knowledge management and value engineering within a single system (Value
Engineering Knowledge Management System – VE-KMS) for improving the problem-
solving approach implemented by the project management team (Zhang et al.
(2009)). In VE-KMS knowledge stems from the existing or new projects as well as
the project management team and is analyzed so as to (i) identify patterns, (ii)
develop new methods for solving problems and (iii) structure all types of
knowledge, both explicit (e.g. documents, project records) and tacit (e.g. domain
specific problems and proposed solutions). The third model is a web-based
prototype (CAPRI.NET) for live capture and reuse of project knowledge (Udeaja et
al (2008)). It captures knowledge from groups, individuals or project documents
and stores only the parts that have been validated by a designated person, called
the Knowledge Manager. CAPRI.NET codifies knowledge (e.g. through keywords) to
enable traceability of information and defines a set of standard processes for
knowledge sharing and diffusion (e.g. update e-mails automatically sent to users).
The last model is a web-based system (Knowledge Platform for Contractors – KPfC)
which formalizes the knowledge-capturing process within construction companies
(Kivrak et al (2008)). The model differentiates external and internal knowledge and
creates a knowledge bank of valuable and reusable information. Both tacit and
explicit knowledge is stored after being evaluated by an authorized person (i.e.
knowledge manager).
A qualitative comparative evaluation of the aforementioned models on the grounds
of what research questions are addressed by each one of them is presented on
Table 1, so as to determine their respective divergences and/or convergences in
relation to KM concepts. The analysis results have been utilised to specify the main
characteristics of the proposed system, which are summarised below:

 Identification of knowledge source, type and traceability (e.g. validation).

 Capture of valuable knowledge to address information gaps (e.g. legislation).

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KM models Research questions addressed

ProFIK - Who needs knowledge?
(Liyanage et al. (2009)) - How is it transferred?
- Where does knowledge stem from?
VE-KMS - Is it valid?
(Zhang et al. (2009)) - How can knowledge be re-used?
- What type of knowledge is created?
CAPRI.NET - How is it captured?
(Udeaja et al. (2008)) - Is it external and/or internal?
KPfC - What are the knowledge gaps?
(Kivrak et al. (2009)) - What type/king of knowledge is needed?

Table 1: Research questions addressed by KM models

3. Methodological approach

A structured approach has been followed for the development of the KM platform,
as shown on Fig. 2.

Fig 2: Methodological approach flowchart

It is essentially a six-step process, which started with the definition of the

knowledge requirements, which for this study would be knowledge created on the
project level, stemming from both external (e.g. public authorities) and internal
(e.g. construction crews) sources. Having defined the type of knowledge that is
required, different alternatives were examined for the realization of the KM
platform. On the basis of the analysis presented in the previous section, it was
decided to develop a Database Management System (DMS). The functional
requirements were summarized in data entry, editing and update for KM (e.g.
prompt retrieval). The main characteristics of the proposed KM tool comprised a
user-friendly environment as well as dedicated templates for registering project
information relating to the main project stakeholders (e.g. owner, project manager,
designer, consultant), project knowledge (e.g. type, category) and legal framework
(e.g. documents, policies, procedures). The design of the proposed tool was
finalized after informal consultation with construction operatives, such as project
managers, senior engineers and designers. MS Access 2003 software was used for
the realization of the KM platform and the final version was evaluated though a
case study in a Greek construction company. More details for the development
process of the proposed KM platform will be provided in the next section.

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4. Development of the KM platform

4.1. System design

The design specifications suggested the creation of a database management system

that would focus on the construction project in three basic forms: design,
construction and consulting or project management. For every design project one
or more designers are assigned to it. In a similar manner, one supervising engineer
is responsible for a construction project and a project manager runs a project
management or consultancy project. In addition, irrespective of the project type, a
project owner and one or more project management team members are specified.
The system includes both private and public projects. Fig. 3 illustrates the main
menu of the developed platform. The technical staff of the company can access the
system by having a password authorized by the company. The user is given four
main options: (i) register a new project and entry new knowledge, (ii) search for
projects through a specially designed index, (iii) make an enquiry by specifying
search criteria or parameters and (iv) create reports for projects/knowledge,
employees etc.

Fig 3: Main menu

A new project entry requires a project title and asks for its type to be determined
(e.g. Design, Construction, Project Management). Moreover, an exact address is
provided for both new construction and renovation projects. Additional data include
commencement and completion dates, total budget and costs as well as a hyperlink
to the project’s electronic file, containing information such as project mail
correspondence, “as-built” drawings, project progress reports etc. All project
employees’ are registered based on their personal details (e.g. name / surname),
profession and contact details (e.g. residence address, mobile / landline, e-mail). It
should be noted that all personnel is registered in a central data storage and can be
assigned different roles depending on the project. In other words, someone that
has served as project manager in one project can be registered as team member in
another etc. Thus, the system preserves the integrity of the stored information and
improves the efficiency of enquiries on behalf of the users.

4.2 Knowledge capture

The captured knowledge is associated with a specific project as shown in Fig. 4.

The user enters a topic that best represents the problem in hand. The knowledge
category is selected from a predetermined list where three options are available:
observations, problems and delays. In a similar manner, the knowledge type relates
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to administrative, legal, technical or other registrations. The knowledge origin is

specified as external or internal to the project. A keyword is given so as to group
knowledge entries that share common characteristics. Then, the knowledge
manager enters a short description of the knowledge entry, describes the actions
that have been taken to address the emerged situation and the results of the
proposed measures. Entries regard tacit knowledge such as know how, innovations,
problems/solutions and explicit knowledge such as specifications, drawings and
reports. Moreover, the registration date is provided along with the personal details
of the user so as to enhance knowledge traceability. Finally, a hyperlink to related
files that aid in comprehending the registered knowledge is provided. Once the
entry has been completed the user can add new knowledge, view added knowledge
by other team members or update the existing knowledge. Updating is important
since knowledge can become obsolete and new techniques or solutions to past
problems may be found.

Fig 4: Template for knowledge capture

4.3. Legislative framework

It has been stressed that the Greek legislative framework is a key determinant of
the project development process for the Greek construction industry. In that view,
the platform enables the capture of legal knowledge pertinent to the realisation of
public and private projects. In the case of public projects, the contract type and
number is registered along with the respective penalty clauses. Additional explicit
knowledge is provided such as applications for appeal, letters of insurance and
confirmations of completion. For private projects, contract type and number as well
as penalty clauses are registered in the same way as before. Since, though, private
projects need to have a building permit, the permit’s number and category are also
inserted accompanied by a series of necessary approvals from public authorities
(e.g. Forest Protection Agency, Archaeological Heritage Agency).

5. Evaluation

A case study in a Greek construction company has been undertaken so as to

evaluate the developed platform and ensure its conformity to the outlined
functional requirements. The company is an ISO 9001 certified organisation, with
extensive experience in the design and construction of building and civil
engineering projects. The system was first demonstrated by the developer to ten
engineers, senior managers and technical staff, who subsequently operated it
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themselves. In addition, five completed projects were entered in the system, so as

to practically demonstrate its main features and characteristics. After the
completion of the demonstration, a semi-structured questionnaire was disseminated
and completed by the participants. The questionnaire comprised twelve evaluation
questions structured in a Likert-scale format, where the respondents expressed
their approval or disapproval of the system on a four-degree scale (Fully agree,
Agree, Disagree, Fully disagree). The questions related to issues such as the
knowledge types covered by the system, its efficiency, whether it is user-friendly,
its structural clarity and overall impression etc. A qualitative analysis of the
responses verified the applicability of the proposed platform. The respondents
identified some important benefits of successfully implementing the system which
could be summarized as follows:
 Systematic capture and reuse of knowledge
 Reduction in costs and time for data management
 Reduction in the needed space for archival storage
 Prompt and efficient problem solving

The last point was highlighted by the participants, since they believed that the
capturing of tacit and explicit knowledge preserves experts’ know how within the
company irrespective of their movement to other projects or companies. Moreover,
the systematic capture of knowledge is particularly important for design studies,
where recurring problems arise. However, there can be barriers to the adoption of
such a system for a Greek construction company, as follows:

 High costs for the development of a fully functional system

 Time needed to familiarise the company’s staff with the new system
 Compatibility problems with other existing systems (e.g. ISO 9001:2008)
 Integration of fragmented knowledge (e.g. legislation)

An additional barrier is the lack of expert know-how in the development of

construction-oriented knowledge management systems in Greece, since it is still an
emerging sector which has been growing rapidly in the last decade, especially in
the IT and e-business sectors.

6. Conclusions

This paper has demonstrated that knowledge management can be a significant

strategic advantage for contemporary construction companies. The implementation
of a KM strategy through the development and application of a respective tool
reduces the amount of knowledge wasted during the design and construction
phases and enables the reuse of accumulated experience, so as to improve
business performance and increase productivity. The developed KM tool
incorporates key characteristics of similar valid models, whereas at the same time
aims at reflecting the peculiarities of the Greek construction paradigm. Both tacit
and explicit knowledge is captured and shared amongst the project participants.
The evaluation of the proposed platform in a Greek construction company
determined the main success factors being the meticulous system's design to
reflect the users' needs and the explicit commitment of the organisation adopting
the system for its further development and improvement. The perceived benefits of
such an effort relate to the creation of a knowledge culture within the organisation,
which can lead to the continuous improvement of the provided services and the
enhancement of the vocational skills of the company’s staff. However, the
implementation of a KM strategy should take into account the existing status of the
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organisation both from a technical (e.g. costs, compatibility with existing

management systems) as well as cultural perspective (e.g. inertia to change). On
any case, developing a coordinated KM strategy that fits the overall objectives and
strategies of the organisation is believed to be an effective way to manage
knowledge assets and remain competitive in the business world.

7. References

El-Gohary, N., M. and El-Diraby, T., E. (2010), “Dynamic knowledge-based process

integration portal for collaborative construction”, Journal of Construction
Engineering and Management, 136(3), 316-328.
Grant, K., A. (2007), “Tacit Knowledge revisited – we can still learn from Polanyi”,
Electronic Journal of Knowledge Management, 5(2), 173-180.
Kivrak, S., Arslan, G., Dikmen, I. and Birgonul, M., T. (2008), “Capturing
knowledge in construction projects: knowledge platform for contractors”,
Journal of Construction Engineering and Management, 24(2), 87-95.
Kiziltas, S. and Akinci, B. (2009), “Contextual information requirements of cost
estimators from past construction projects”, Journal of Construction Engineering
and Management, 135(9), 841-852.
Liyanage, C., Elhag, T., Ballal, T. and Li, Q. (2009), “Knowledge communication and
translation – a knowledge transfer model”, Journal of Knowledge Management,
13(3), 118-131.
Nonaka, I. and Takeuchi, H. (1995), “The Knowledge-creating company: How
Japanese companies create the dynamics of Innovation”, Oxford University
Press, New York.
Payne, J. and Sheehan, T. (2004), “Demystifying knowledge management: A best
practice guide for the construction industry”, Constructing excellence, UK,
<www.constructingexcellence.co.uk>, (Accessed 10/02/2010).
Udeaja, C., E., Kamara, J., M., Carrillo, P., M. and Anumba, C., J. (2008), “A web-
based prototype for live capture and reuse of construction project knowledge”,
Automation in Construction, 17, 839-851.
Zhang, X., Mao, X. and AbouRizk, S., M. (2009), “Developing a knowledge
management system for improved value engineering practices in the
construction industry”, Automation in Construction, 18, 777-789.

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AA033

Correlating multiple 2D vision trackers for 3D object tracking on

construction sites

Man-Woo Park
(Ph.D. Candidate, School of Civil & Environmental Engineering,
Georgia Institute of Technology, Atlanta, USA)

Christian Koch
(Postdoctoral Research Fellow, School of Civil & Environmental Engineering,
Georgia Institute of Technology, Atlanta, USA)

Ioannis Brilakis
(Assistant Professor, School of Civil & Environmental Engineering,
Georgia Institute of Technology, Atlanta, USA)

Abstract
Tracking methods have the potential to retrieve the spatial location of project
related entities such as personnel and equipment at construction sites, which can
facilitate several construction management tasks. Existing tracking methods are
mainly based on Radio Frequency (RF) technologies and thus require manual
deployment of tags. On construction sites with numerous entities, tags installation,
maintenance and decommissioning become an issue since it increases the cost and
time needed to implement these tracking methods. To address these limitations,
this paper proposes an alternate 3D tracking method based on vision. It operates
by tracking the designated object in 2D video frames and correlating the tracking
results from multiple pre-calibrated views using epipolar geometry. The
methodology presented in this paper has been implemented and tested on videos
taken in controlled experimental conditions. Results are compared with the actual
3D positions to validate its performance.

Keywords
Vision tracking, epipolar geometry, 3D positioning

1. Introduction

3D object tracking on construction sites has a wide variety of applications. Being

able to effectively identify and track personnel, equipment and materials can
effectively support progress monitoring, activity sequence analysis, productivity
measurements, asset management as well as enhancing site safety. In addition,
real time tracking instantly enables the identification of critical activities and
problems, which allows for in-situ project control and decision making capabilities.
Available tracking solutions are mainly based on Radio Frequency technologies
including Global Positioning System (GPS), Radio Frequency Identification (RFID),
Wireless Networks (Wi-Fi) and Ultra Wideband (UWB) technologies. They all work
under the same principle of having a sensor attached on each entity to be tracked.
In outdoor and congested construction sites (e.g. highway construction), due to the
large amount of items involved, tracking technologies that require attaching

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sensors to each single item have additional time and cost burdens associated with
performing sensor installations.
The research, part of which is presented in this paper, proposes an alternate
tracking methodology based on vision. Under this method, video-streams are
collected from constructions sites and then used to determine the spatial location of
project related entities across time. In order to achieve this, the first step is to
compare the performance of existing 2D tracking methods. It has turned out that
kernel-based methods are most suitable for construction related applications
(Makhmalbaf et al., 2010). Using a selected kernel-based 2D tracking algorithm
(Ross et al., 2008), the 2D locations of an entity are determined and recorded for
corresponding video frames. Since 2D locations are not sufficient to be used for
construction management tasks, the next step is to correlate corresponding views
in order to calculate depth values. For this purpose, epipolar geometry is used to
provide the 3D aspect, which allows the user to retrieve 3D location information in
real time. Preliminary results were obtained by testing this method on a scaled
model of a highway construction site at the Construction Information Technology
Laboratory. The results are compared with the actual 3D position in order to
validate that the method proposed can effectively provide accurate localization of
construction site entities.

2. Object Tracking

2.1 Current Practice in 3D Tracking

Common tracking methods are based on Radio Frequency and include several types
of technologies like Global Positioning Systems (GPS), Radio Frequency
Identification (RFID), Bluetooth and Wireless Fidelity (Wi-Fi, Ultra-Wideband, etc).
They have been successfully used when tracking prefabricated materials (Song et
al. 2006), equipment, inventory (Caldas et al. 2004) and personnel (Teizer 2007).
RFID technology does not require line-of-sight (as opposed to vision-based
methods), and also it is durable to harsh environments and can be embedded in
concrete. Reading range depends on the frequency at which the tag operates, and
it varies from several inches up to about 10 feet. Unlike barcodes, reading range is
not a fixed distance, allowing tags to be read at any distance within the range. In
addition, RFID enables efficient automatic data collection since readers can be
mounted to any structure to detect and each reader can scan multiple tags at a
given time.

However, all RFID technologies face several limitations, which restrict their
applicability in outdoor and congested construction sites. The main disadvantage of
frequency based systems is the need for installing a sensor in each entity before
any type of tracking information can be acquired. Due to the large number of
entities that need to be tracked in congested construction sites, in most cases it is
infeasible to attach a sensor on each entity since the cost associated with this work
and equipment becomes considerable. Moreover, RFID technology, unless combined
with other tools (Ergen et al, 2007), can only report the radius inside which the
tracked entity exists, and the near-sighted effect (the location is not reported until
the reader reaches the radius of the reading range) prohibits its use in real-time
tracking applications. Another important aspect is privacy. Since RFID tags have to
be attached to persons, who are to be tracked, this method is not favored by
Construction Unions due to the lack of privacy they provide workers on the site
(Juels 2006).

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2.2 Vision based 2D Tracking

Vision based 2D tracking can be a proper alternative to RFID methods because it

removes the need for installing sensors and ID tags of any kind on the tracked
entity. For this reason, this technology is (a) highly applicable in dynamic, busy
construction sites, where large numbers of equipment, personnel and materials are
involved, and (b) more desirable from personnel who wish to avoid being “tagged”
with sensors. In Gruen (1997) it is highly regarded for its capability to measure a
large number of particles with a high level of accuracy. Generally, vision tracking
fuses video cameras and computer vision algorithms to perform several
measurement tasks and has been considered as an inference problem (Forsyth and
Ponce, 2002). The moving entity has a certain internal state which is calculated in
each frame. The tracking algorithms then need to combine these calculations to
estimate the state of the entity. Information such as the speed, acceleration, flow
and periodic motion of the entity can then be inferred.
Vision tracking methods can be categorized in kernel-based, contour-based, and
point-based methods, depending on the way of representing objects. In kernel-
based methods, an object is represented by the color or texture in the region of
interest, and its position in next frame is estimated based on the region’s color or
texture information. In contour-based methods, an object is represented by
silhouettes or contours that determine the boundary of the object. In point-based
methods, an object is represented by a set of feature points extracted from the
region that contains the object. Out of the three categories, kernel-based methods
are most suitable for construction related applications regarding the construction
sites’ characteristics such as illumination condition and object types on construction
sites (Makhmalbaf et al., 2010). Compared to the kernel-based methods, point-
based methods (Mathes et al., 2006) are prone to lose the object whenever it gets
difficult to extract sufficient feature points (e.g. when it is very dark or bright).
Also, contour-based methods (Vaswani et al., 2010) do not provide a consistent
centroid of the object.

3. Vision based 3D Tracking

2D vision tracking results, which just present 2D object positions in an image, are
not sufficient to be used for construction management tasks due to the complexity
and large scale of the construction sites. To obtain meaningful 3D location
information, an additional process of integrating 2D vision tracking results from
multiple camera perspectives is required. The objective of this work is to accurately
determine the 3D location of distinct construction related objects, such as
equipment, personnel and materials of standard shape and size across time.

3.1 Methodology

The tracking methodology proposed in this paper consists of a computer receiving

video feeds collected from on site video cameras. The method can be used with
several cameras connected simultaneously. These cameras must have at least
partially overlapping views of the site object that is to be tracked in order to
calculate the 3D location of the entity. After receiving the video feed, the cameras’
views are projected in the user’s window simultaneously. The user can select an
entity of interest in both of the views. Selecting an area corresponding to the object
(e.g. safety vest or hardhat) is enough to initialize tracking.

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The method then calculates the selected area’s centroid, as a representation of the
object’s 2D location on the image frame. Subsequently, a kernel-based tracking
algorithm (Ross et al., 2008) is used to track the areas identified in each of the
views. The object tracking is performed simultaneously and independently in each
camera. This feature allows the user to locate and track the object in real time
across the entire site simultaneously. The result of the 2D tracking algorithm is the
2D position of the object’s centroid in each window. Subsequently, epipolar
geometry is used to calculate the depth of the centroid that determines the 3D
location of the object in each frame. The system records the tracking information
and displays the 3D coordinates of the entity in the user’s window. The
methodology for this algorithm is illustrated in Figure 1.

…
+
Video 2 Display
video Select Select
+ stream s object area + object area +…
sim ulta- in view 1 in view 2
Video 1 neously

3D coordi- Determ ine 3D Track 2D areas and

nates object position calculate their centroids

Fig 1: Methodology overview

3.2 Object Selection and 2D Tracking

The identification of the object area of interest is performed interactively by the

user. The user selects the same object area in both of the views presented to him
by marking it on the screen. The created rectangular areas are used to determine
the object location in the image planes by simply calculating the centroids (centers
of gravity) of the marked regions. Using the 2D tracking algorithm described above,
the object location is recalculated in each subsequent frame and updated as the
marked object moves. The result of the 2D object tracking is the real-time object
location in each camera’s view.

3.3 3D Location Calculation

The 2D tracking results are used to determine the real-time 3D object location
based on epipolar geometry. In order to perform epipolar geometry calculations, at
least two cameras must be present and their views must overlap in the region that
contains the object of interest. Based on the overlapping regions, the 8-point-
algorithm is used to determine the fundamental matrix, which geometrically relates
corresponding points (PL, PR) in stereo images (Fig. 2). The fundamental matrix
enables full reconstruction of the epipolar geometry, since it encodes information
about both intrinsic and extrinsic parameters of the cameras views. The centroid’s
coordinates of the object are used to calculate the epipolar lines in each of the
camera’s views. These epipolar lines are necessary to find the 3D location of the
object. Since the centroid of the object is known on both camera views, the
projection of that point across the epipolar plane in both of the views leads to an
intersecting point P in 3D space (Fig. 2). This intersection point contains the depth

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coordinate of the object’s centroid. This procedure provides 3D perspective

reconstruction and allows for the calculation of the 3D object location (P) in every
frame. For a more detailed description of epipolar geometry, the 8-point-algorithm,
and the fundamental matrix, the interested reader is referred to Hartley and
Zisserman (2003).

Input n correspon-
ding points (n≥8)
P

Construct homoge-
neous system Ax=0
Singular value decom -
Epipolar Plane position (SVD) of A
Com pute SVD of
PL PR resulting m atrix
Epipolar Lines Enforce singularity
constraint
Set least singular
value to 0

Epipoles
Estim ate of Funda-
OL OR m ental Matrix
eL eR

Fig 2: Epipolar Geometry for two cameras OL and OR (left) and 8-point-algorithm
for Fundamental Matrix calculation (right)

4. Results

The method presented in this paper has been implemented and tested on videos
taken in controlled experimental conditions. Results are compared with the actual
3D positions to validate its performance.

Fig 3: 2D tracking sequence for left (L) and right (R) camera view (frame no. 21,
101, 161 and 206)

Although the method can be implemented with several cameras simultaneously, the
basic example (2 cameras) was used for experimental purposes and to reduce the
computational load of the system. In order to minimize the error of manually
synchronizing a pair of frames according to time, it was decided to use a stereo
USB webcam. This webcam by default records synchronized frame sequences. The
stereo videos taken contain 191 frames (~ 13 sec) each at a resolution of 640x480
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pixels and a frame rate of 15 fps. The highway construction site model used for
testing is of scale 1:87. The moving object to be tracked was a small truck at a size
of 6.5 mm length, 2.2 mm width and 2.2 mm height (Fig. 3).
The actual positions of the truck were determined by a start point Q1 and an end
point Q2 that were measured manually. For simplicity reasons it was intended and
assumed that the truck moved straight along the line L defined by Q1 and Q2.
Figure 3 presents example video frames showing the model environment and the
tracked truck object.
Based on the corresponding 2D centroid positions PL and PR, the 3D location P of
the truck was determined for every video frame. The performance results are
quantified by an absolute error EABS that is defined as the distance between the
determined 3D position P and the line L = Q1 + t (Q2 – Q1).
EABS := |(Q2 – Q1) x (P – Q1)| / |(Q2 – Q1)| (1)
Figure 4 presents the overall performance results by plotting the absolute errors
EABS(i) against the frame numbers i = 21..211. The graph shows the maximum
error EMAX= 105.4 mm at frame #127 and the average error EAVG = 47.8 mm.

120

(127, 105.4) Average Error
100
Absolute Error

80
Error (mm)

60
47.8
40

20

0
21 41 61 81 101 121 141 161 181 201
Frame Number

Fig 4: 2D tracking sequence for left (L) and right (R) camera view (frame no. 21,
101, 161 and 206)

Due to the model scale of the test environment the determined errors have to be
scaled by factor 87. This yields a maximum error ĒMAX = 9.17 m that obviously can
compete stand-alone GPS with an accuracy of around 10 m (Caldas et al. 2004).
Moreover, scaling the average error yields ĒAVG = 4.16 m, which is less than the
actual length of the tracked object. Based on these error magnitudes it can be
stated that the vision based 3D tracking approach presented was successfully
tested and verified.
However, it is believed that the first results presented can be improved.
Considering frame #127, which is related to the maximum error EMAX, it was
recognized that the determined centroid positions PL and PR differ to a significant
extent. Figure 5 presents the left and right view of frame #127 highlighting the
rectangular areas used for 2D tracking and their centroids. The noticed difference is
about 3 to 4 pixels according to a fixed position (e.g. bottom right corner of the
side window). Misarranged coordinates determined in the triangulation process
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result in an incorrect depth value for the 3D location of P. It is concluded, that the
position of the selected rectangular area has a significant impact on 3D tracking
results. Based on this finding, it is proposed to specify the area by selecting its
centroid, rather than by selecting the area’s exterior shape and determining the
centroid afterwards. Furthermore, the 2D tracking results can be enhanced by
utilizing high resolution cameras, which directly affects the accuracy of the 3D
tracking result.

Fig 5: Differing centroid position PL and PR after 2D tracking in video frame #127

5. Conclusions

3D object tracking on construction sites has a wide variety of applications. Being

able to effectively identify and track personnel, equipment and materials can
support progress monitoring, activity sequence analysis, productivity measure-
ments, asset management as well as enhancing site safety. Available tracking
solutions based on Radio Frequency technologies have been successfully used when
tracking prefabricated materials, equipment, inventory and personnel. However, in
open construction sites (e.g. highway construction), due to the large amount of
items involved, tracking technologies that require attaching sensors to each single
item have additional the time and cost burdens associated with performing sensor
installations.
This paper presented an alternate tracking methodology based on vision tracking,
which removes the need for object tagging. Under this method, video-streams are
collected from constructions sites and then used to determine the spatial location of
project related entities across time. Using a selected kernel-based 2D tracking
algorithm, the 2D locations of an entity are determined and recorded for
corresponding video frames. Epipolar geometry is then used to correlate multiple
views and to calculate the depth value, providing the 3D aspect and allowing the
user to retrieve 3D location information in real time. Preliminary results were
obtained by testing the method on a scaled model of a highway construction site at
the Construction Information Technology Laboratory. The maximum error deter-
mined is comparable with the standard accuracy of stand-alone GPS, and the
average error is even less than the maximum dimension of the tracked object. It
was found that the errors are reasonably attributed to incorrect 2D tracking in
terms of an inaccurate determination of object centroids. However, the results
presented validate that the vision based 3D tracking approach proposed can
effectively provide accurate localization of construction site entities. The next step
is to investigate how visual pattern recognition methods can be used to automati-
cally recognize and match entities removing the need for manual entity selection.

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6. Acknowledgements

The presented work is based upon a research funded by the National Science
Foundation Grant # 0933931. NSF’s support is gratefully acknowledged.

7. References

Caldas, C.H., Torrent, D.G., and Haas, C.T. (2004), “Integration of automated data
collection technologies for real-time field materials management”, 21st
International Symposium on Automation and Robotics in Construction, Jeju,
Korea
Ergen, E., Akinci, B., and Sacks, R. (2007), “Tracking and locating components in a
precast storage yard utilizing radio frequency identification technology and
GPS”, Automation in Construction, 16(3), 354-367
Forsyth, D.A., Ponce, J. (2002), “Computer Vision: A Modern Approach”, Prentice
Hall
Gruen, A. (1997), “Fundamentals of videogrammetry – A review”, Human
Movement Science Journal, 16, 155-187.
Hartley, R. and Zisserman, A. (2003). “Multiple View Geometry in computer vision”,
Cambridge University Press
Juels, A. (2006), “RFID Security and Privacy: A Research Survey”, IEEE Journal on
Selected Areas in Communications, 24(2), 381-394
Makhmalbaf, A., Park, M.-W., Yang, J., Brilakis, I., and Vela, P. A. (2010), “2D
Vision Tracking Methods’ Performance Comparison for 3D Tracking of
Construction Resources”, Construction Research Congress 2010, Banff, Canada
Mathes, T. and Piater, J.H. (2006), “Robust Non-Rigid object Tracking Using Point
Distribution Manifolds”, 28th DAGM (Deutsche Arbeitsgemeinschaft für
Mustererkennung), Berlin, Germany
Ross, D., Lim, J., Lin, R.-S., and Yang, M.-H. (2008), “Incremental Learning for
Robust Visual Tracking”, Int. J. Comput. Vis., 77, 125-141.
Song, J., Haas, C., Caldas, C., Ergen, E., and Akinci, B. (2006), “Automating Pipe
Spool Tracking in the Supply Chain”, Automation in Construction, 15/2, 166-
177
Teizer, J., Lao, D., and Sofer, M. (2007), “Rapid Automated Monitoring of
Construction Site Activities Using Ultra-Wideband”, 24th International
Symposium on Automation and Robotics in Construction (ISARC 2007).
Construction Automation Group, I.I.T. Madras
Vaswani, N., Rathi, T., and Yezzi, A. (2010), “Deform PF-MT: Particle Filter With
Mode Tracker for Tracking Nonaffine Contour Deformations”, IEEE Trans. Image
Processing, 19(4) 841-857.

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AA083
Working Cultures and Human Resources in the Construction Industry
of the Balkan Peninsula

Parthenopoulos Nicoleta
(Post Graduate Student, Aristotle University, Thessaloniki, Greece)

Stavroulis Savina
(Post Graduate Student, Aristotle University, Thessaloniki, Greece)

Naniopoulos Aristotelis
(Professor, Dept. of Civil Engineering, Aristotle University, Thessaloniki,
Greece)

Abstract
Factors such as characteristics of the human resources, labour conditions, labour
relations and others are referred to as “working cultures”. The basic goal of the
current paper is to identify and discuss main existing characteristics of the “working
cultures” that appear in the Balkan. Moreover to consider how attractive such
characteristics are for the development of construction projects in the area.
Based on the analysis, the research concluded that Balkan countries include a
variety of labour “fields” under continuous evolution. A S.W.O.T. analysis (from the
point of view of a foreign employer and employee) led to the conclusion that these
countries appear to have interest both for the potential employer and employee.

Keywords
Working cultures, human resources, Balkans, construction industry.

1. Introduction

The term “working cultures” refers to the employees and includes the following
main characteristics: labour force, labour organization, labour environment, labour
conditions and labour relations. The study of the “working cultures” in various levels
is essential for a formed and successful business action. [Naniopoulos A. (1998),
Rahtz N. (1998), Naniopoulos A.-Christidis P. (2000)]
Labour force concerns social characteristics (age, sex, nationality etc) as well as the
work contract (full time, part time, regular), the source of employment and the
number of employees proportional to the field of the market and the category of
the profession. Labour organization consists of the work systems, the operational
flexibility and the organizational structure. The basic characteristics of the labour
environment are health and safety, the human factor in the work field and the
natural conditions. Labour conditions include hours (basic working hours, shifts
system, overtime) and pay-systems (basic salary, economical motivation,
supplementary fees, privileges), process of employment and welfare status
(pension, sickness allowance etc). In labour relations the existence of unions,
consultation, conflicts and strikes are examined.

1.1 Industrial relations (associations) in the Balkan countries.

The construction sector has always been featured by strong union consciousness
and action. The hard working environment in the construction industry resulted to
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the formation of a coalition of workers to fight for better working conditions. But
this has changed, as the employees nowadays show little interest for participation
in trade unions because they believe that the associations and unions in the
construction sector are often under the control of employers.

One of the most striking examples (among those countries that collecting data was
feasible) is Bulgaria, where the percentage of workers who are members of trade
unions is only 16% which is even lower to the respective 20% that was recorded a
few years ago.

In Serbia, unions are weak, mainly due to the mistrust to union trade leaders who
are perceived as seekers of their own –instead of common- interests.

The country where the situation differs from the above is Bosnia and
Herzegovina. Both state entities, the Federation of Bosnia and Herzegovina and
the Republika Srpska, demonstrate a high rate of union participation. Since 2005 in
Bosnia and Herzegovina trade unions from the two state entities have formed a
new –yet still not recognized at the state level- association that is expected to
represent the great majority of workers in the country.

Slovenia is also one of the exceptions among the Balkan countries on the issue of
trade union density with a large number of employees being organized in
associations and trade unions.

1.2 Hours, fees

The basic salary for workers amongst the Balkan counties shows a wide range.
Aggregated data on working hours and minimum wage for an unskilled worker
drawing by ILO (2009) and FedEE (2009) are presented in Table1. All Balkan states
have institutionalized the 5 days and 40 hours work week.

MANDA OVERTIME BASIC BASIC REFEREN

COUNTRY TORY (HOURS SALARY SALAR CE YEAR
WORKI PER WEEK) (local Y (€)
NG currency)
HOURS
Bulgaria 40 6 240 Lev 122,83€ 2009
F.Y.R.O.M. 40 10 20116 327,64€ 2009
denars
Albania NOT NOT FOUND 18000 lek 130,14€ 2009
FOUND
Serbia 40 8 12133,33 125,06€ 2009
dinars
Montenegro 40 8 NOT FOUND 55,00€ 2007
Bosnia & 40 10 NOT FOUND 127,00€ 2010
Herzegovina
Croatia 40 10 2814 HRK 386,11€ 2009
Slovenia 40 COLLECTIVE NOT FOUND 566,53€ 2008
CONTRACTS
Romania 40 48 TOTAL 600 RON 146,20€ 2009
Table 1: Data on working hours and minimum wages (source: authors’ processing)
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1.3 Legislation

The growth of the construction industry is strongly affected by the respective

legislation in each country.

A clear and streamlined labour law can be a powerful tool both for workers and
employers who are allowed to perform in a steady environment that facilitates
planning, organizing and implementing with a long term perspective.

On the other hand, laws in a specific country can be a powerful tool for any trader
who operates in the country. An institutional and legal framework that simplifies
approval procedures for investments in a country, that demonstrates clear rules
about reinvestment and export earnings, and that even helps contributing the
increase of information on opportunities, obviously supports the investors as a key
concern.

The tax system and potential tax exemptions provided to investors are very
important factors that influence entrepreneurship. Agreements signed for the
protection of investments are a great tool for entrepreneurs, and agreements on
avoidance of double taxation can be a key incentive for the establishment of a
company in a specific region.

1.4 Occupational Health and Safety

The number of occupational accidents and diseases that lead to injuries and deaths
is very high. The Balkan countries, mostly developing ones, need to achieve
significant improvement in order to reduce fatalities in the working environment
and keep up with the high health and safety standards in the EU.

Aggregated data drawn by Hämäläinen et al (2009) on occupational accidents and

fatal work-related diseases are presented in Table2.

FATAL OCCUPATIONA
COUNTRY OCCUPATIONA FATALITY L ACCIDENT
L ACCIDENTS RATE RATE
Bulgaria 288 10,2 9,551
F.Y.R.O.M. 60 10,9 10,264
Albania 91 9,8 9,220
Serbia NOT FOUND NOT FOUND NOT FOUND
Montenegro NOT FOUND NOT FOUND NOT FOUND
Bosnia and 128 12,4 11,698
Herzegovina
Croatia 58 38,0 3,538
Slovenia 49 5,5 5,163
Romania 1016 11,0 10,360
Table 2: Data on occupational accidents (source: authors’ processing)

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1.5 Workforce

The workforce of the Balkan countries consists of workers who have reading and
writing skills at an average of 98% while a 30% has received primary education.
[Agency for statistics of Bosnia and Herzegovina (2010), Institute of Statistics
(2010), Croatian Bureau of Statistics (2010), Croatian Bureau of Statistics (2010),
Republic of F.Y.R.O.M. – State statistical office (2010), Statistical Yearbook of
Serbia 2009, CIA World Factbook].
Typically in the Balkan countries the tendency is for employees rather than self-
employed workforce. On average, 77.3% of workers are employees of whom 33%
are employed in the public sector and 44.3% are private employees. The proportion
of self-employed workers is quite low, averaging between the Balkans estimated at
a 14,6% of all workers. [ILO(2009), fedEE (2009) , P3C – Republic of Serbia (01-
2010, National Institute of Statistics (2010)].

Another conclusion drawn from the study about the labour force in the Balkan
Countries is that the largest proportion of the population is in the age group
between 15-64 years. A main feature of the working environment in the Balkan
countries is the high unemployment rate, which is increasing in the recent years.
The above figures appear in detail in Table 3.

WORK FORCE
WORK PORTION OF
Composition by sector Unemploy Population
FORCE EMPLOEES
COUNTRY Agri ment below poverty
(millions) (Total population) Industry Services
culture
6,3%
Bulgaria 2,670 37,06 % 7,5% 35,5% 57,0% 14,1% (2003)
(79)
F.Y.R.O.M 33,8%
.
0,925 44,76 % 19,6% 30,4% 50,0% 29,8% (2006)
(182)
12,5% 25,0%
Albania 1,103 30,31 % 58,0% 15,0% 27,0%
(138) (2004)
18,8% 6,5%
Serbia 2,961 40,13 % 30,0% 46,0% 24,0%
(163) (2007)
Monteneg 14,7% 7,0%
ro
0,259 38,53 % 2,0% 30,0% 68,0%
(152) (2007)
Bosnia &
29,0%
Herzegov 1,863 40,38 % 19,8% 32,6% 47,6% 25,0%
ina (174)
0,550 40,0% 37,0%
Kosovo 30,47 % 16,5% - -
(187) (2007)
13,7% 11,0%
Croatia 1,731 38,56 % 5,0% 31,3% 63,6%
(147) (2003)
6,7% 12,9%
Slovenia 0,940 46,87 % 2,5% 36,0% 61,5%
(84) (2004)
4,4% 25,0%
Romania 9,320 41,95 % 29,7% 23,2% 47,1%
(56) (2005)
Table 3: Establishment of labour and rising unemployment rate (source: various
sources and authors’ processing)

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Basic Secondar Man Woma Universit Man Woma

educatio y n y degree n
n educatio
(or less) n
Bulgaria NOT NOT NOT NOT NOT NOT NOT
FOUND FOUND FOUN FOUND FOUND FOUN FOUND
D D
F.Y.R.O.M. 32,7 55,5 36,2 4,2 9,9 20,9 5,8
Albania 37,1 23,6 22,2 12,9 6,2 4,9 4,2
Serbia 45,3 47,6 57,5 38,3 7,1 8,3 5,9
Montenegr 26,1 67,9 43,1 14,4 6,0 35,5 6,9
o
Bosnia & 17,0 62,3 NOT NOT 20,7 NOT NOT
Herzegovin FOUN FOUND FOUN FOUND
a D D
Kosovo NOT 36,0 17,2 18,8 18,9 8,0 10,9
FOUND
Croatia 24,9 61,7 35,2 26,4 13,5 7,2 6,5
Table 4: Education of population (source: various sources and authors’ processing)

2. SWOT Analysis
A SWOT analysis was conducted both from the Greek point of view of the employer
and the employee aiming basically at the categorization of data -that were collected
and concern the “working cultures”- in advantages and disadvantages that
influence decision making of the foreign employer and employee. The latter refers
to the possibility of taking action in the Balkan “work arena”: developing
construction enterprises for the employer and finding an occupation for the
employee.

2.1 SWOT analysis - employer

Strengths
 Labour hours
 International conditions included in labour legislations (Serbia, Slovenia)
 Labour code, annual collective labour bargaining, social security (Romania)
 Common culture with that of Greece as far as labour is concerned
 Well organized trade unions (Bulgaria, Romania, Slovenia, Bosnia &
Herzegovina) – labour stability
 Low density of unionists (the rest countries)

Weaknesses
 Insufficient terms of law
 Sectors of labour health and safety are under development
 Excess of different nationalities (F.Y.R.O.M., Serbia, Romania)
 Low organization in trade unions
 Low educational level

Opportunities
 Low basic payment
 High unemployment (Kosovo 40%, F.Y.R.O.M. 33,8%, Bosnia 29%, Serbia
18,8%)

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 High percentage of the population belongs to the ages of 15-64 (67-70%, on

average)
 High percentage of the population are employees-clerks
 Know-how by the occupation in heavy forms of industry

Threats
 High percentage of the population is under the limits of poverty (Kosovo
37%, F.Y.R.O.M. 29,8%, Albania 25%, Bosnia 25%, Romania 25%)
 Variety of religious beliefs (Slovenia, Croatia, Serbia)

2.2 SWOT analysis - employee

Strengths
 Organized unions (Bulgaria, Romania, Slovenia, Bosnia)
 International conditions included in labour legislations (Serbia, Slovenia)
 Labour code, annual collective labour bargaining, social security (Romania)
 Common culture with that of Greece as far as labour is concerned

Weaknesses
 Insufficient terms of law
 Sectors of labour health and safety are under development
 Low basic payment
 Low educational level
 Low level of services referring to the quality of the habitants’ life

Opportunities
 Know-how by the occupation in heavy forms of industry
 Need of E.U. membership
 Research Institutes and Universities
 Cooperation for the proper human resource management aiming at the
development of employment
 High percentage of the population belongs to the ages of 15-64 (67-70%, on
average)

Threats
 High unemployment (Kosovo 40%, F.Y.R.O.M. 33,8%, Bosnia 29%, Serbia
18,8%)
 High percentage of the population is under the limits of poverty (Kosovo
37%, F.Y.R.O.M. 29,8%, Albania 25%, Bosnia 25%, Romania 25%)
 Variety of religious beliefs (Slovenia, Croatia, Serbia)
 Excess of different nationalities

3. Conclusions – Suggestions

Based on the previous analysis, it is concluded that Balkan countries are an

interesting research field. These are developing countries with uncertain political
status, whose future is directly dependent on the decisions of external
organizations such as NATO and the E.U. (Bulgaria, Romania, Slovenia are
members of the European Union and NATO). Some countries have recently
obtained their independency, while others have history but with a recent Republic
status. The most stable countries are Bulgaria, Romania, Albania and Slovenia,
though they are not relieved from political turbulences. Croatia reserves low profile
with the pending issue of its borders. In Bosnia is observed general political
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division, whereas in Albania crisis is being revitalized. F.Y.R.O.M. has not yet solved
the issue of its name and there are internal conflicts between the ethnic Albanians
and the ethnic Sebs. Bulgaria implements energy-politics.
The countries of the Balkan Peninsula are not characterized as having high-dense
population. There is a slow rate of population augmentation. The positive fact is
that in most countries the highest percentage of population is in the constructive
ages.

S.W.O.T. analysis led to the conclusion that these countries appear to have interest
for foreign investors – maybe low because of the global economic crisis but still
present. Specifically, strengths and opportunities appear to be more significant for
employers than employees. On the other hand, as far as the human resources are
concerned threats and weaknesses tend to tilt the balance against their interests.
Countries that facilitate foreign investment activities (according to the legal status)
are those of the Western Balkan area, providing motivations such as low taxes and
opportunities of contracts avoiding double taxation. In the countries that are
already members of the E.U., a working culture similar to that of Greece is
gradually developing. Hence, the businessman who is about to take action in these
countries, has a high knowledge of the problems as well as the requirements and
obligations that is going to face.

Large and “mature” companies tend to prefer countries of the Eastern Balkans and
in particular countries – members of the E.U. because of the stability and the
favorable fiscal conditions. There is also cheap labour force and low cost of living.
In Romania, there is land offer. Land purchase in combination with the
development of power plants seems to be a good perceptive in these countries.

In a sense, countries that are not E.U. members, despite the unstable political
climate, would seek to attract foreign investors by offering privileges to create the
conditions that will improve their image in the European environment. On this
basis, and given the fact that large companies are already operating in other Balkan
countries (Bulgaria, Romania, F.Y.R.O.M.), the other could be a destination for
smaller companies (with a relative risk).

Choosing the Balkan area as a labour destination, a key element is the

unemployment rate. The lowest unemployment rates among the Balkan countries
are Bulgaria, Slovenia and Romania.

The worker, who comes from Greece and works in a Greek company abroad, will
have the advantage of high purchasing power because the salary will be Greek but
the cost of living will be low. On the other hand, a worker from the Balkans that will
work there in a Greek company enjoys the benefits of good working conditions and
the fact that he/she will have the opportunity to work.

This paper was based on contemporary data that were gathered together mainly by
official sites in the internet and also by some interviews. The study led to first
conclusions that, besides others, show that the process of analyzing the factors
concerning labour and that influence the construction industry is dynamic. Further
surveys, besides the theoretical research and analysis in each case (employer and
employee), must be carried out, as well as on site investigation of circumstances
and opportunities that may arise (ad hoc).

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The working cultures, and especially the state of labour conditions and labour force,
have a great impact at the activation of construction enterprises. The human
resources are considered as the most important asset in the possession of an
organization, an important factor that can lead in the creation of the desired
competitive advantage. The Construction sector needs high skilled employees that
can perform comfortably under ideal circumstances and conditions and within the
ideal cost limit; demands not only new techniques, due to the high evolvement of
construction complexity, but also better management of all the operations and
tasks of the organization in general and of a project in particular.

The Balkan area provides opportunities in this field because these countries are
developing and require approaches that can upgrade them. They also desire to
attract foreign investors and construction projects to diminish their unemployment
rate. Working cultures need to be monitored in all circumstances, in order to aid
their improvement. Gathering statistical data for all the factors taken into account
and developing the proper model for the continuous update and development of the
above information is essential not only in terms of providing the guarantees for the
enhancement of the construction sector’s activities but also in terms of improving
working cultures in the region.

4. References

Naniopoulos, A. (1998):”Work Organisation in Freight Transport Systems. European

approach to define structural changes and policy requirements following the
introduction of new technology”. Transport Europei Journal, No 10 December
(1998).
Rahtz N. (1998) :”Working Cultures as a Key Factor in Intermodal Developments”
in: Working cultures in freight transport, Conference Proceedings, Brussels,
December 1998, Editor: Naniopoulos A
Naniopoulos, A. Christidis, P. (2000) : “Work Organisation in Ports in a Process of
Change”, 16th International Port Logistics Conference “A New Role for the Middle
East in the New Millennium in International Cargo Flows” Alexandria, Egypt,
February 2000
ILO - International Labour Organization (2009) Internet, available from:
http://www.ilo.org/dyn/travail/travmain.sectionReport1?p_lang=en&p_countries=B
G&p_sc_id=1001&p_year=2009&p_structure=2
FeDEE - Federation of European Employers (2009) Internet, available from:
http://www.fedee.com/minwage.html (Accessed January 2010)
Export Entreprises SA (2010) Operating a Business in Bosnia and Herzegovina.
Internet, available from:
http://www.egypt-import-export.com/en/country-profiles/bosnia-and-
herzegovina/operating_a_business2#working (Accessed February 2010)
P3C – Republic of Serbia (01-2010) Internet, available from:
http://webrzs.statserb.sr.gov.yu/axd/en/drugastrana.php?Sifra=0018&izbor=publik
acija (Accessed January 2010)
National Institute of Statistics (2010) Internet, available from:
http://www.insse.ro/cms/rw/pages/anuarstatistic2007.en.do (Accessed January
2010)
Agency for statistics of Bosnia and Herzegovina. Internet, available from:
http://www.bhas.ba/eng/Questionaries.asp?Test=32r5&Rez=1&Pripadnost=5&
mode=dark (Accessed January 2010)
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Institute of Statistics. Internet, available from:

http://www.instat.gov.al/
Croatian Bureau of Statistics (2010) Internet, available from:
http://www.dzs.hr/Eng/Publication/2009/9-2-7_3e2009.htm (Accessed January
2010)
Republic of Macedonia – State statistical office. Internet, available from:
http://www.stat.gov.mk/english/statistiki_eng.asp?ss=07.01&rbs=1
Statistical Yearbook of Serbia 2009. Internet, available from:
http://webrzs.statserb.sr.gov.yu/axd/en/god.htm
http://webrzs.statserb.sr.gov.yu/axd/en/drugastrana.php?Sifra=0018&izbor=publik
acija
CIA World Factbook (Accessed December 2009)
Hämäläinen, P., Kaija, L., Jukka, T. (2009) “Global trend according to estimate
number of occupational accidents and fatal wok related diseases at region and
country level”, Journal of Safety research, 136-138.

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INV-4

PMForum – The Untold Story!

Pells David L.
(President, Managing Editor PMForum, Inc, USA)

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W01
Research Methodological Position for a Doctoral Study on
‘Apportioning Liability in Delay Claims’

Nihal Perera
(School of the Built Environment,University of Salford, Salford, M5 4WT.,
United Kingdom)

Monty Sutrisna
(School of the Built Environment,University of Salford, Salford, M5 4WT.,
United Kingdom)

Abstract
Central to successful resolution of delay based claims is the fair and equitable
apportioning of parties’ liabilities. However, such fairness and equity in
apportioning may be fettered by many factors in contemporary practices
adopted by both contractors and clients. The principal goals and rationale of this
research are inspired by the need to identify and curb such major obstructive
factors. Thus, the research study aims to bring about contractually sound,
practical improvements to problematic situations in contemporary practices.
Such improvements are expected to produce more equitable, efficient,
transparent and less contentious outcomes in delay claims resolution. To
achieve the aim and objectives, it is considered necessary to establish a firm
methodological position for the research study. This paper has strived to
establish such position. In this effort, various ontological, epistemological and
methodological stand points are considered. Consequently, the paper has
concluded the appropriateness of using the naturalist paradigm in this study.

Keywords
Ontology, Epistemology, Methodology, Positivist and Naturalist Paradigms.

1. Introduction

This research aims to critically examine how the apportionment of liabilities in

delay claims is practiced in the local context with a view to identifying
problematic situations associated with such practices towards developing a
framework for improvement. Thus, the research methodology is developed with
the following objectives, in response to the key research questions1:

i. To investigate how the apportioning of liabilities in delay claims is carried out

by practitioners, particularly in the local context;
ii. To find out what problematic situations stem from the approaches and
methods currently used by practitioners;
iii. To explore what constructive ‘improvements’ can possibly be perceived in
order to deal with the problematic situations; and

1
Due to limited space, the key research questions are not discussed here. However, they are based on
the Maxwell’s (1996) three types of questions for qualitative research, namely, Descriptive Question,
Interpretive Question and Theoretical Question.

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iv. To assess the extent to which the proposed ‘framework’ is evident to improve
the current approaches and methods in terms of contract
documentation,claims administration, and delay analysis methodology.

The research design is the logical sequence that connects the empirical data to
study’s research questions and ultimately to its conclusions (Yin, 2003). This paper
describes how the research design is developed in order to achieve these research
objectives. Firstly, the theoretical perspective for the development of research
strategy is established. In this, a critical review of typology of major social
paradigms is carried out in order to identify the appropriate philosophical position of
the research. Consequently, within the Naturalistic approach, the Constructivist
paradigm is selected instead of the dominant Positivist or Post-positivist paradigm
or Critical theory et al as the principal paradigm to be adopted. This philosophical
position is mainly guided by the works of Lincoln and Guba (1985), Guba and
Lincoln (1989, 1994), and Denzin and Lincoln (1994).

Once the ontological and epistemological positions have been established, the focus
of the paper shifts to the research methodology that is required for addressing the
research questions and the answers to be found for them. It observes how the
selection of methodology has been constrained by the already considered
ontological and epistemological positions. Finally, Naturalistic inquiry paradigm is
selected for formulating the overall methodology and inquiry strategy.

2. Establishing Methodological Position

Denzin and Lincoln (1994) defined a paradigm as a basic set of beliefs that guide
action. Paradigms deal with first principles, or ultimates. These beliefs can never be
established in terms of their ultimate truthfulness. Each paradigm encompasses
three elements, namely ontology, epistemology and methodology; Ontology raises
questions about the nature of reality while epistemology asks ‘how do we know the
world’; Methodology concerns on how we gain knowledge within the context of the
‘selected’ nature of reality (Denzin and Lincoln, 1994).

2.1 Basic Paradigms

Guba and Lincoln (1994) conceptualized four basic paradigms as belief systems
based on the philosophical assumptions of ontology and epistemology to see the
world and how it should be studied and understood. These basic paradigms are
identified as Positivism, Post-positivism, Critical Theory et al, and Constructivism.

With regard to Ontological position, Positivism is commonly called “naive realism”,

whereas Post-positivism is identified as “critical realism” (reality is assumed to
exist, but to be only imperfectly apprehendable because of basically flawed human
intellectual mechanisms and fundamentally intractable nature of phenomena).
Critical Theory et al are treated as “historical realism”. On the other hand,
Constructivism is based on “relativism”, that is when realities are apprehendable
in the form of multiple, intangible mental constructions, socially and experiential
constructions are not more or less “true”, in any absolute sense, but simply more or
less informed and/ or sophisticated. Constructions are alterable, as are their
associated “realities”. Thus, Constructivism differentiates from other three

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paradigms as it is guided by ‘relativism’ while the others are by various forms of

‘realism’.

In Epistemological analysis, Positivism, which is a dualist and objectivist approach,

assumes the investigator and investigated ‘object’ are to be detached, independent
entities, and the investigator to be capable of studying the object without
influencing it or being influenced by it. Inquiry takes place as through a one-way
mirror. Replicable findings are, in fact, “true”. In Post-positivism approach,
though dualism is largely abandoned, objectivity remains a “regulatory ideal”.
Replicated findings are probably true but always subject to falsification.
Constructivism and Critical Theory et al have transactional and subjectivist
approach and assume that the investigator and investigated ‘object’ are to be
interactively linked, with the values of the investigator (and of situated ‘others’)
inevitably influencing the inquiry. Findings are therefore value mediated. In this
posture the traditional distinction between ontology and epistemology is challenged.
What can be known is inextricably intertwined with the interaction between a
particular investigator and a particular object or group. Accordingly, Constructivism
and Critical Theory et al are different from other two paradigms in their approach to
the subjectivist - objectivist dichotomy.

In Methodological analysis, Positivism takes an experimental and manipulative

approach with carefully controlled (manipulated) conditions to prevent outcomes
from being improperly influenced. This methodology thus focuses on verification of
hypotheses and uses chiefly quantitative methods. Post-positivism emphasizes on
and has mainly invested in ‘critical multiplism’ (a refurbished version of
triangulation) focusing on falsification (rather than verifying) of hypotheses. In
Critical Theory et al the transactional nature of inquiry requires a dialogue
between the investigator and the subject of inquiry. That dialogue must be
dialectical in nature to transform ignorance and misapprehensions (accepting
historically mediated structures as immutable) into more informed consciousness.
This methodology aimed at the reconstruction of previously held constructions. As
for Constructivism the variable and personal (intra-mental) nature of social
constructions suggest that individual constructions can be elicited and refined only
through interaction between and among investigator and respondents. These
varying constructions are interpreted using conventional hermeneutical techniques
and are compared and contrasted through a dialectical interchange. The final aim is
to distill a consensus construction that is more informed and sophisticated than any
of the predecessor construction. Except for that, this also aims at the reconstruction
of previously held constructions, similar to Critical Theory paradigm.

2.2 Selecting the Paradigm

The above paradigms, as sets of basic beliefs, are not open to proof in any
conventional sense and there is no way to elevate one over another on the basis of
ultimate, foundational criteria. Guba and Lincoln (1994) argued that any given
paradigm represents simply the most informed and sophisticated view that its
proponents have been able to devise, given the way they have chosen to respond
to the three defining questions appear below:

(i) Ontological question – What’s the form and nature of reality and,
therefore, what is there that can be known about it? If a “real” world is assumed
then what can be known about it is “how things really are” and “how things really

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work”. Then only those questions that relate to matters of “real” existence and
“real” action are admissible.
(ii) Epistemological question: What is the nature of the relationship between
the knower or would be knower and what can be known? (The answer that can be
given to this question is constrained by the answer already given to the ontological
question; for example, if a “real” reality is assumed as to ontology, then the
posture of the knower must be one of objective detachment or value freedom in
order to be able to discover “how things really are” and “how things really work”).
(iii) Methodological question: The question here is how can the inquirer
(knower) go about finding out whatever he believes can be known? Again the
answer that can be given to this question is constrained by the answers already
given to the first two questions; that is, not just any method is appropriate. For
example, a “real” reality pursued by an “objective” inquirer mandates control of
possible confounding factors, whether the methods are qualitative or quantitative.

In the selection of the appropriate paradigm for the research, the following
philosophical assumptions provide answers to the said three defining questions:

2.2.1 Ontological assumptions

The question here is what’s the form and nature of reality and, therefore, what is
there that can be known about it? The answer to this can be found in the following
considerations.

Central to successful resolution of delay based claims is the fair and equitable
apportioning of parties’ liabilities. Therefore, parties primarily desire that the
‘apportioning of liabilities’ is carried out fairly and equitably. However, whether
these aspirations of parties are met or not will largely depend on how the
apportioning of liabilities is carried out by the practitioners on both sides.

The perception of fair and equitable ‘apportioning of liabilities’ is mainly constructed

by those practitioners’ tacit and explicit knowledge of the applicable contract and
case law, approaches, notions of fairness and equity, and also choice of analysis
methods to be used. The concepts of knowledge, approaches, recognition and
implementation of appropriate law and analysis methods, notions of fairness and
equity etc. are identified as constructed realities rather than objective realities
(realism). These are conceived as constructed in mind though they are intrinsically
related to ‘tangible entities’ such as ‘delay-events’ and similar phenomena. Lincoln
and Guba (1985) argued: ‘Events, persons, objects are indeed tangible entities.
The meanings and wholeness derived from or ascribed to these tangible
phenomena in order to make sense of them, organize them, or recognize a belief
system, however, are constructed realities’. Thus, they are not created as pure
objective phenomena; they are related to human cognition rather than to a physical
object. They are constructed notions, and in turn resident in the minds of
individuals. ‘They do not exist outside of the persons who create and hold them;
they are not part of some ‘objective’ world that exists apart from their constructors’
(Guba & Lincoln, 1989).

Accordingly, how the apportionment of liabilities in delay claims is practiced, and

what problematic situations are deriving from such practices can be perceived only
through the individual practitioners’ subjective experience, tacit or explicit
awareness, and interpretation of what they have implemented in practice. Crotty
(1998) suggested that their ‘meaning is not discovered, but constructed’. As this
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obtained perception is built around individual cognition, its ‘existence’ or ‘being’ is

primarily idealist and relative. Therefore, in terms of ontology they can be
perceived as ‘constructed realities’ (Constructivism, Relativism) only and not
through Positivist (naive realism) or Post-positivist (Critical realism) or Critical
Theory (Historical realism) approach.

Guba and Lincoln (1994) identified ontology with local and specific constructed
realities under Relativism-Constructivism paradigm of inquiry. It is suggested that
the Constructivist philosophy is pluralist and relativist; they are multiple and often
conflicting and potentially meaningful (Guba and Lincoln, 1985). In this instance,
the research setting is found to be situated within the specific and localized
circumstances of the practices as they are situated in the UAE, in Dubai; also the
research inquiry intends to capture information from multiple approaches and
methods of practitioners who may construct meaning in different ways even for the
same occurrence (Pluralism); each of these approaches and methods, though they
can be divergent and mutually conflicting, may still be meaningful as fair and
equitable under different circumstances, providing they are implemented aptly and
pertinently (Relativism), for example a delay analysis technique which is not
consistent with the terms of one particular contract may be consistent with those of
another contract.

In the current research, these multiple constructed realities can be studied

holistically only. Therefore, using a design that assumes a single, identifiable,
isolated, and measurable treatment to deal with them would be less appropriate.
Inquiry into such multiple realities will inevitably be divergent, comprehensive,
variable, and dynamic so that prediction and control are unlikely outcomes although
some level of understanding can be achieved. In view of the foregoing
considerations, Constructivist Relativism (Naturalist paradigm) is vindicated over
Positivist or Post-positivist Realism or Critical Theory as the approach to the nature
of reality (ontology) in the current research settings.

2.2.2 Epistemological assumptions

The question here is what’s the nature of the relationship between the knower
(inquirer) and what can be known? The answer that can be given to this question is
constrained by the answer already given to the ontological question. That is not just
any relationship can now be postulated (Denzin and Lincoln, 1994).

Patton (2002) argued that in practice human interventions are often quite
comprehensive, variable, and dynamic, and this creates considerable difficulty for
controlled experimental designs that need specifiable, unchanging treatments to
relate specifiable predetermined outcomes. Thus, it is suggested that under real-
world conditions where programs are subject to change and redirection, Naturalistic
inquiry replaces the fixed treatment /outcome emphasis of the controlled
experiment (Positivist approach).

The propositions in the current research settings can hardly be converted into
precise mathematical formula expressing functional relationships. Therefore,
Positivist or Post-positivist inquiry which is used to verify or falsify a priori
hypotheses through mathematical relationships is less appropriate paradigm for the
current research. Human behaviour, unlike that of physical objects, cannot be
understood without reference to the meanings and purpose attached by human
actors to their activities. Qualitative data, it is asserted, can provide rich insight into
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human behavior (Denzin and Lincoln, 1994). In the current research settings, the
human factor is dominant which is informed by the practitioners (respondents) and
their activities. That can be understood only through non-mathematical paradigms
like naturalist inquiry. In the current research the thing that can be known is firstly
the manner that the contemporary practices in local industry deal with the
‘apportionment of liabilities’. This is to be known primarily in order to perceive the
problematic situation which is the next thing that can be known. Thereafter, in
order to know the necessary ‘improvements’ required for the existing practices, the
‘views’ of the practitioners who experience the problematic situation are to be
captured by the researcher (knower). This knowledge can be captured only through
the interaction between the researcher and the respondent practitioners. For that,
the ‘knower’ and the ‘object to be known’ have to be interactively linked. Thus, the
inquiry process cannot be routed through a one-way mirror. Therefore, any
approach to treat this as a relationship between detached, independent entities
(Positivism) is simply inappropriate.

In view of the foregoing considerations, it can be concluded that what is required is

a Naturalistic approach to the relationship of knower to the known (Epistemology)
rather than a Positivist approach in the research.

2.2.3 Methodological assumptions

The question here is how can the inquirer (knower) go about finding out whatever
he believes can be known? Again the answer that can be given to this question is
constrained by the answers already given to the first two questions; that is, not just
any method is appropriate. The methodological question cannot be reduced to a
question of methods; methods must be fitted to a predetermined methodology
(Denzin and Lincoln, 1994). Burrell and Morgan (1979) suggested that, if the
researcher takes an ‘objectivist’ standpoint to reckon the social world as a hard and
objective reality existing outside to the individual cognition (Realism) then his
method of inquiry of research would be seeking to explain and predict what
happens in the social world by searching for regularities and causal relationships
between its constituent elements (Positivism); he will treat human beings as
product of their environment (Determinism) and his research methodology would
be aiming to search for universal laws which explain and govern the reality that is
being observed (Nomothetic methodology).

However, as we discussed above, the philosophical position applicable to the

current research takes a ‘subjectivist’ standpoint to reckon the social world. It does
not reckon a hard and objective reality existing outside to the individual cognition;
nor does it assume that there is one objective reality experienced the same way by
everyone. Instead, it considers the reality involved is multiple realism and is
‘constructed’ by participants differently. As Robson (2002) suggests with reference
to Constructivism, here the ‘reality is socially constructed’. These varying
constructed realities are to be compared through dialectical interchange in order to
distill a consensus construction that is more informed and sophisticated than any of
the predecessor construction. This requires a method of inquiry of research that
would focus on different issues in different ways to understand from the inside
rather than the outside (Anti-positivism); it will treat human beings as possessing
free will to act voluntarily (Voluntarism). Thus, a methodology that focuses on
verification or falsification of hypotheses (Positivism, Post-positivism) mainly
engaging quantitative methods would not be appropriate in such research setting.

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Accordingly, similar to the ontological and epistemological assumptions, it can be

concluded that a Naturalistic approach is appropriate to inquire and know in this
investigation rather than a Positivist approach in the research inquiry process.

2.2.4 Inquiry Strategy Method of Inquiry and Trustworthiness

Having established the philosophical position above for methodology, it requires

developing the specific inquiry strategy. For this, Naturalistic inquiry paradigm is
selected on similar philosophical position and beliefs as Constructivist Relativism
and Interpretive paradigm. [It is noted that Constructivism is identified as one of
many Interpretive paradigms (Denzin and Lincoln, 1994). Therefore, it may be
suggested that the research’s philosophical position is consistent with the
interpretive paradigm as well]. Accordingly, in determining the specific inquiry
strategy for the current research the methodological considerations presented by
Naturalistic inquiry paradigm are regarded for necessary guidance. Lincoln and
Guba (1985) suggested that major and sometimes only data collection instrument
utilized in Naturalistic inquiry is the inquirer him-or herself, and the sources that
instrument utilizes may be both human and non-human. As to the human sources
they are tapped by interviews (structured and /or unstructured) and observations,
while non-human sources include documents and records, as well as the
unobtrusive informational residue (conventionally called unobtrusive “measures”)
left behind by humans in their everyday activities that provides useful insights
about them.

In accord with Naturalistic inquiry paradigm, as for method of inquiry, several of

qualitative methods are selected for collecting and analyzing empirical data. From
the five approaches suggested by Cresswell (2007), phenomenological study and
case study are identified in terms of the primary focus of the study and within
qualitative approach. As with phenomenological study the focus is on understanding
the essence of experiences about a phenomenon or a concept while case study has
focus on developing an in-depth analysis of single or multiple cases. The required
information is captured through the practitioners’ perceptions, experience and
application of ‘fairness’ and ‘equity’ in the apportioning liabilities in delay claims.
Accordingly, semi-structured interviews, questionnaires, discussions, observations,
analysis of pre-existing texts are selected as the principal methods for collecting
and analysing data.

Miles and Huberman (1994) proposed a series of approaches in the form of

questions for assessing “goodness” of qualitative work. Lincoln and Guba (1985)
suggested four basic questions based on truth value, applicability, consistency and
neutrality which must be addressed in the validity of any research inquiry. They
also argued that those conventional criteria of ‘internal’ and ‘external validity’,
‘reliability’, ‘objectivity’ etc. used in Positivist approach are inappropriate for the
Naturalistic inquiry approach. Instead they suggested ‘credibility’, ‘transferability’,
‘dependability’ and ‘conformability’ as more appropriate alternative criteria together
with techniques such as ‘triangulation’, ‘peer debriefing’, ‘discrepant evidence’,
‘thick description’ and ‘audit trail’. These approaches will form the evaluative
criteria for trustworthiness of the research findings and whether the study is
persuasive and believable.

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3. Summary and Further Research

Considerations of ontological and epistemological positions have shown that the

Constructivist Relativism is vindicated over Positivist or Post-positivist Realism or
Critical Theory et al as the paradigm required in the current research settings. On
the other hand, these considerations also constrain the approach to be taken as to
methodological position for research inquiry. Thus, a Naturalistic inquiry approach is
selected rather than a Positivist approach for the inquiry strategy and process.

Selection of naturalist inquiry paradigm entails engaging variety of qualitative

methods in the development of the research. Using such qualitative methods, the
research is now to proceed to the next stage of collecting and analysing the
empirical data which have to be captured through phenomenological and case
studies.

4. References

Burrell, G. and Morgan, G. (1979), “Sociological Paradigms and Organisational

Analysis”, Heinemann.
Creswell, J.W. (2007), “Qualitative Inquiry and Research Design: Choosing among
Five Approaches” (2nd edition), Sage Publication, London.
Crotty, M. (1998), “The Foundation of Social Research”, Sage Publication, London.
Denzin, N.K. and Lincoln, Y.S. (1994), “Handbook of Qualitative Research”, Sage
Publication, London.
Guba, E.G. and Lincoln, Y. S. (1994), “Competing Paradigms in Qualitative
Research”, in: N.K. Denzin and Y.S. Lincoln (ed.), Handbook of Qualitative
Research, Sage Publication, London.
Guba, E.G. and Lincoln, Y. S. (1989), “Fourth Generation Evaluation”, CA:Sage.
Lincoln, Y. S. and Guba, E.G. (1985), “Naturalistic Inquiry”, Sage Publication,
London.
Miles, M.B. and Huberman, A.M. (1994), “Qualitative Data Analysis: An expanded
Source Book” (2nd edition), Sage Publication, London.
Patton, M. Q. (2002), “Qualitative Research & Evaluation Methods” (3rd edition),
Sage Publication, London.
Robson, C. (2002), “Real world Research” (2nd edition), Blackwell Publishing,
Oxford.
Yin, R.K. (2003), “Case Study Research: Design and Methods” (3rd edition), Sage
Publication, London.

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AA011
Factors Affecting Cost Contingency in International Projects

Gul Polat
(Assistant Professor, Istanbul Technical University, Istanbul, Turkey)

Mert Duzcan
(Planning and Cost Control Engineer, Alarko Construction Co., Istanbul, Turkey)

Abstract
Contractors include a reasonable contingency amount as an allowance for potential
risks in their bid, especially in international projects, in order to protect themselves
against possible failures as the international construction environment is highly
influenced by several complex factors such as intense competitiveness due to the
existence of numerous competent rivals, unfamiliarity with the country, local
conditions, and the client in question, uncertainties in the project environment, etc.
The aim of this study is to identify the importance levels of the risk factors that
may affect cost contingency amounts in international projects. Review of the
literature indicated that there are 59 risk factors, and these factors are categorized
into 6 groups, which include; bidding stage-related factors, construction-related
factors, finance-related factors, country-related factors, company-related factors,
and contract-related factors. Having identified and categorized these factors, a
questionnaire was designed and data of 36 construction projects from 14 countries
were collected for evaluation of these risk factors.

Keywords
Risk factors, International construction, Cost contingency, Questionnaire, Turkey.

1. Introduction

Construction companies, especially in developing countries, have begun to

undertake international projects as a result of the globalization of construction
markets. Generally, carrying out projects in international construction markets is
riskier than carrying out projects in domestic markets as the international
construction environment is highly influenced by several complex factors such as
intense competitiveness due to the existence of numerous competent rivals,
unfamiliarity with the host country conditions, project environment, the client in
question, and unavailability of resources (e.g., materials, labourers, equipments,
subcontractors, etc.) in the host country, etc. These factors may likely have an
adverse impact on the project performance. Given this risky construction
environment, contractors need to identify all potential risks inherent in international
projects during the bidding stage, thoroughly assess them, determine the risk level
of the project, and include a reasonable contingency amount as an allowance for
potential risks in their bid in order to protect themselves against possible failures
(Sonmez et al. (2007)).

Determination of the accurate contingency amount plays a critical role in not only
obtaining the contract and but also achieving project goals. While low amounts of
contingency may bring about significant losses in highly risky projects, high
amounts of contingency may cause contractors to lose the job. This study aims to
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identify the importance levels of the risk factors that may affect cost contingency
amounts in international projects.

2. Turkish Contractors in International Markets

There are approximately 100,000 contractors registered with the Ministry of Public
Works and Settlement in Turkey. If one considers unregistered companies, this
number goes up to 200,000, which is greater than the total number of E.U.
contractors (Yemar Report (2009)). Turkish contractors do not only undertake
projects in the domestic market but also in international markets including the
Commonwealth of Independent States, Africa, the Middle East, Europe, Asia, etc.
Turkish contractors have been undertaking projects in international construction
markets since the 1970s. They were participating in small-scaled projects as
subcontractors in the beginning, yet they are now undertaking prestigious projects
as prime contractors. Figure 1 shows the total values of the international projects
won by Turkish contractors in the period between 2003 and 2008 (Yemar Report
(2009)).

Fig 1: Total values of the international projects won by Turkish contractors

Indeed, Turkish contractors have won more than 3,500 projects with a total value
of $84 billion in 65 different countries so far (Yemar Report (2009)). As a result of
this success, Turkish contractors have ranked 2nd in 2009 in the Engineering News
Record’s (ENR) Top 225 International Contractors list. Table 1 shows the number of
Turkish contractors and their rankings in the ENR’s Top 225 International
Contractors list in the period between 2005 and 2009.

Years Number of Turkish Contractors Ranking

2005 14 4
2006 20 3
2007 22 3
2008 23 3
2009 31 2

Table 1: Number of Turkish contractors and their rankings in the ENR’s Top 225
International Contractors list

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Undoubtedly, the continuity of this success mostly depends on the extent to which
Turkish construction companies include a reasonable cost contingency, which is
determined by the risk level of the project, in their bid.

3. Research Methodology

3.1. Questionnaire Design

Review of the literature (Hayes et al. (1986), Gunhan and Arditi (2005a,b), Dikmen
et al. (2007), Sonmez et al. (2007), Ozorhon et al. (2007), Bu-Qammaz et al.
(2009)) indicated that there are 59 risk factors that may affect cost contingency
amounts in international construction projects and these factors are categorized
into 6 groups, which include; bidding stage-related factors, construction stage-
related factors, finance-related factors, country-related factors, company-related
factors, and contract-related factors. These 59 risk factors are shown in the first of
column of Table 2.

Having identified and categorized these factors, a questionnaire, which consists of

69 questions, was designed. The questionnaire mainly included two sections. The
first section involved 10 questions, which inquired about the context of the
respondent company and the project characteristics including experience of the
company in the construction industry, number of employees, total turnover in
domestic and international markets, project type, project size, client profile,
contract type, the host country, and contingency amount used for the project. The
second section comprised 59 questions. These questions were meant to explore the
importance level of the risk factors presented in Table 2 using a scale of 1-5, where
“1” represents the best condition and “5” represents the worse condition.

3.2. Data Analysis Methods

In order to test the reliability of the questionnaire, reliability analysis using the
internal consistency method was conducted using the statistical package SPSS®.
Cronbach’s alpha (α) is the most common measure of scale reliability (Field
(2005)). The standardized Cronbach’s alpha is calculated using Eq. 1.

N   x 2  N  yi2 
  i1  (1)
N 1  x 2 


where N is the number of risk factors, σx2 is the variance of the observed total test
scores, and σyi2 is the variance of risk factor i.

A value of at least 0.60 for Cronbach’s alpha indicates that the scale is reliable in
exploratory studies (Pallant (2005)). One or more of the variables defining the
construct may have to be deleted if it helps to increase the value of Cronbach’s
alpha (Field (2005)).

Having conducted the reliability analysis, ranking analysis was performed to find
the relative importance of risk factors based on the survey data. Since the ordinal
data were collected in the questionnaire survey, parametric statistics would not
produce meaningful results. Thus, severity index analysis was chosen to rank the

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risk factors according to their relative importance (Chen et al. (2009)). Severity
index is calculated using Eq. 2:

 5 wi   f i / n  
SeverityIndex( SI )   i 1  (2)
 a 
 

Where; i is the point given to each risk factor by the respondent, ranging from 1 to
5, wi is the weight for each point, fi is the frequency of the point i by all
respondents, n is the total number of responses, and a is the highest weight, which
is 5 in this study.

Five important levels are then transformed to SI values, which are: High (H)
(0.8≤SI≤1), High-Medium (H-M) (0.6≤SI<0.8), Medium (M) (0.4≤SI<0.6),
Medium-Low (M-L) (0.2≤SI<0.4), and Low (L) (0≤SI<0.2) (Chen et al. (2009)).

4. Findings and Discussion

4.1. Sample Characteristics

Questionnaires were sent to the randomly selected 50 contractors, which are

registered to Turkish Contractors Association (TCA) and operate in international
construction markets, and 20 contractors returned 36 duly completed
questionnaires including data of 36 construction projects from 14 different
countries. This corresponds to a response rate of 40%.

25% of the respondent contractors had more than 41 years of experience in the
construction industry, 20% of them had experience between 31-40 years, and 20%
of them had experience between 21-30 years, and 35% of them had experience
between 10-20 years. While 60% of the respondents employed more than 1,500
workers, only 15% of them employed less than 100 employees. 45% of the
respondent companies completed projects with a value of more than $750 million in
Turkey and only 10% of the contractors completed projects, whose contract values
are less than $50 million. Similarly, the majority of the respondent companies
(55%) undertook international projects worth more than $750 million and only 10%
of the contractors completed projects with a value of less than $50 million.

42% of the studied projects were institutional and commercial building

construction, 40% of them infrastructure and heavy construction, 10% of them
residential housing, and 8% of them specialized industrial construction. The
contract values of the studied projects ranged between less than $50 million (25%)
to more than $750 million (11%). While 40% of the projects were contracted with
public sector clients, 42% of them were contracted with private sector clients. 58%
of the contracts were lump sum and 42% of them unit price. The host countries of
the studies projects include Libya (8 projects), Bulgaria (6 projects), Russia and
Saudi Arabia (4 projects in each country), Turkmenistan (3 projects), Algeria and
Oman (2 projects in each country), Azerbaijan, Georgia, Jordan, Kazakhstan,
Pakistan, Poland, and Qatar (1 project in each country). Figure 2 shows the number
of projects and the contingency amounts allocated for each project in percentage of
contract value are shown in Figure 2.

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Fig 2: The number of projects and the contingency amounts allocated for each
project in percentage of contract value

As seen in Figure 2, 5% of the contract values were allocated for contingency

allowance in 16 out of 36 projects, which corresponds to 44% of the studied
projects.

4.2. Reliability of the Questionnaire

With the help of SPSS 16.0, Cronbach’s alpha was calculated to test the internal
consistency reliability of the generated scale. Cronbach’s alpha value is 0.831 for
bidding stage-related factors, 0.797 for construction-related factors, 0.687 for
finance-related factors, 0.870 for country-related factors, 0.921 for company-
related factors, and 0.849 for contract-related factors. All alpha values are greater
than 0.6, which indicate that all reliability coefficients are acceptable and the
internal consistency of the risk factors included in the scale is high.

4.3. Ranking Analysis

Severity index values were calculated using the formula in Eq. 2. Based on the
magnitude of the severity indices and average ratings of the risk factors, the
ranking results for each risk factor category, namely bidding stage-related factors,
construction stage-related factors, finance-related factors, country-related factors,
company-related factors, and contract-related factors, and for all risk factors are
presented in descending order in Table 2.

Based on the ranking results, 2 risk factors have “High” importance level for cost
contingency amounts. These risk factors include “bureaucratic difficulties” and
“unavailability of qualified workforce in the host country”. Both of these factors are
“country-related factors”. This finding may result from the fact that Turkish
contractors predominantly undertake projects in either developing or undeveloped
countries. Since bureaucracy, unqualified workforce, low productivity, unavailability
of resources, high inflation rates, etc. are commonly experienced in such countries;
it is not surprising that Turkish contractors face problems resulting from the
adverse conditions prevailing in the host countries.

According to Table 2, a total of 9 risk factors, which consist of 1 bidding stage-

related factor, 1 finance-related factor, 4 country-related factors, and 3 contract-
related factors, were recorded to have “High-Medium” importance levels. As
expected, 4 out of 9 risk factors of “High-Medium” importance are related to the
adverse conditions prevailing in the host country. Moreover, the finance-related

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factor, which has “High-Medium” importance level, namely high inflation rate in the
host country, is related to the host country conditions to a large extent. 3 of these
factors are related to the unsatisfactory contract conditions. This finding may result
from that the majority of the studied projects (58%) were performed under lump
sum contracts. While lump sum contracts protect the owner from increases in the
price, it is very risky for the contractor if there are unfair, uncertain and incomplete
clauses in the contract. The survey results indicated that most of the respondent
contractors suffer from such clauses in contracts.

The survey results indicated that 35 out of the remaining 48 risk factors have
“Medium” importance levels, and 13 of them have “Medium-Low” importance levels.
None of the 59 risk factors has “Low” importance level.

Rank.
Ave. Overall Imp.
Risk Factors SI3 by
Rat.2 Rank. Level2
Categ.
Bidding stage-related factors
Design complexity 2.9 0.6 1 3 H-M
Inadequate site investigations 2.6 0.5 2 4 M
Incompatibilities between design documents and
2.4 0.5 2 4 M
specifications
Insufficient time for bid preparation 2.1 0.4 3 5 M
Vagueness of the project scope 2.0 0.4 3 5 M
Inexperience of personnel working in the bidding
1.9 0.4 3 5 M
department
Unfamiliarity with the specifications and
1.9 0.4 3 5 M
standards prevailing in the host country
Inadequate market investigations 1.7 0.3 4 6 M-L
Unrealistic budget allocation for mobilization and
1.7 0.3 4 6 M-L
overhead costs
Lack of site visits 1.7 0.3 4 6 M-L
Construction stage-related factors
Poor performance of subcontractors 2.6 0.5 1 4 M
Adverse weather conditions 2.5 0.5 1 4 M
Difficulties in procuring materials and equipments
that comply with the project requirements in the 2.4 0.5 1 4 M
host country
Tight schedule 2.1 0.4 2 5 M
Inexperience of the company in obtaining the
2.0 0.4 2 5 M
required construction permits in the host country
Unfamiliarity with the construction technique
2.0 0.4 2 5 M
used in the project in question
Unavailability of subcontractors and suppliers 1.8 0.4 2 5 M
Poor planning 1.7 0.3 3 6 M-L
Unavailability of resources 1.5 0.3 3 6 M-L
Technical and technological complexities 1.3 0.3 3 6 M-L
Finance-related factors
High inflation rate in the host country 2.8 0.6 1 3 H-M
High fluctuations in exchange rates 2.4 0.5 2 4 M
Delay in payments 2.2 0.5 2 4 M
Low % of advance payment 1.9 0.4 3 5 M
Difficulties in taking credits 1.7 0.4 3 5 M
Unfamiliarity with the tax system in the host
1.5 0.3 4 6 M-L
country
Country-related factors
Bureaucratic difficulties 3.9 0.8 1 1 H

2
Average Rating on a Scale of 1-5: 1=Very Low, 2=Low, 3=Medium, 4=High, 5=Very High
3
Severity Index: High (H) (0.8≤SI≤1), High-Medium (H-M) (0.6≤SI<0.8), Medium (M) (0.4≤SI<0.6), Medium-
Low (M-L) (0.2≤SI<0.4), and Low (L) (0≤SI<0.2)
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Unavailability of qualified workforce in the host

3.7 0.8 1 1 H
country
Difficulties in obtaining visa for the employees 3.4 0.7 2 2 H-M
Poor productivity of labourers in the host country 2.9 0.6 3 3 H-M
Difficulties in transporting materials and
2.8 0.6 3 3 H-M
equipments to the host country
Bribery 2.7 0.6 3 3 H-M
Inadequate banking system and difficulties in
2.5 0.5 4 4 M
money transfers
Security problems (e.g., theft, public disorder) 2.5 0.5 4 4 M
High commissions for construction permits 2.4 0.5 4 4 M
Instability of economical conditions 2.4 0.5 4 4 M
Poor attitude of host country 2.4 0.5 4 4 M
High wages of qualified workforce in the host
2.2 0.5 4 4 M
country
Change of regulations and laws 1.9 0.4 5 5 M
Poor attitude towards the project 1.5 0.3 6 6 M-L
Company-related factors
Poor productivity due to high turnover of the
1.9 0.4 1 5 M
employees
Poor managerial capabilities 1.8 0.4 1 5 M
Difficulties in keeping records 1.7 0.3 2 6 M-L
Poor motivation of the employees 1.7 0.3 2 6 M-L
Poor health and safety conditions 1.3 0.3 2 6 M-L
Contract-related factors
Vagueness of contract conditions regarding
2.9 0.6 1 3 H-M
claims due to delays in payments
Strict contract conditions regarding delays and
cost overruns resulting from design and site 2.8 0.6 1 3 H-M
conditions
Unsatisfactory contract conditions regarding
claims due to design changes and additional 2.8 0.6 1 3 H-M
works
Unsatisfactory contract conditions regarding
2.6 0.5 2 4 M
delays in designs
Unsatisfactory contract conditions regarding
2.5 0.5 2 4 M
escalations
High % of retention money 2.4 0.5 2 4 M
Long guarantee period 2.3 0.5 2 4 M
Unsatisfactory contract conditions regarding
2.3 0.5 2 4 M
fluctuations in exchange rates
Poor contract conditions that do not comply with
2.2 0.5 2 4 M
international standards
High penalties 2.2 0.5 2 4 M
Inadequate definition of force majors 2.1 0.4 3 5 M
Unsatisfactory contract conditions regarding the
1.9 0.4 3 5 M
dispute resolution method
Unclear contract conditions regarding the rights
1.7 0.3 4 6 M-L
and responsibilities of the parties
Vagueness of contract conditions regarding the
1.5 0.3 4 6 M-L
situations for which penalties will apply

Table 2: Rank of risk factors affecting cost contingency amounts

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5. Conclusions

Allocation of the accurate contingency amount for the bid prices in international
projects plays a significant role in the project success. Review of the literature
indicated that there are 59 risk factors that may affect cost contingency amounts in
international construction projects. These factors are categorized into 6 groups,
which include; bidding stage-related factors, construction-related factors, finance-
related factors, country-related factors, company-related factors, and contract-
related factors. Data of 36 construction projects completed by 20 Turkish
contractors in 14 different countries were collected via a questionnaire survey,
which consists of 69 questions. Reliability and ranking analyses were carried out in
order to test the reliability of the questionnaire and find the relative importance of
risk factors based on the survey data, respectively. The ranking results revealed
that 2 out of 59 risk factors have “High”, 9 have “High-Medium”, 35 have
“Medium”, and 13 have “Medium-Low” importance levels. None of these 59 risk
factors has “Low” importance level. Most of the risk factors, which have “High” or
“High-Medium” importance levels, are “country-related factors”. This finding may
result from the fact that Turkish contractors predominantly undertake projects in
either developing or undeveloped countries and adverse conditions such as low
productivity, unavailability of resources, bureaucracy, high inflation rates, etc.
commonly prevail in such countries. Thus, it is highly expected that Turkish
contractors face problems resulting from such adverse conditions prevailing in the
host countries. This study identifies the importance levels of the risk factors that
may affect cost contingency amounts in international projects and establishes the
framework for further studies, which aim to investigate the relationships between
the importance levels of the risk factors and contingency amounts, and propose a
multi-criteria-decision-making tool for predicting the contingency amount
considering the importance levels of the risk factors.

6. References

Bu-Qammaz, A.S., Dikmen, I. and Birgonul, M. T. (2009), “Risk assessment of

international construction projects using the analytic network process”,
Canadian Journal of Civil Engineering, 36(7), 1170-1181.
Chen, Y., Okudan, G.E. and Riley, D.R. (2009), “Sustainable performance criteria
for construction method selection in concrete buildings”, Automation in
Construction, doi: 10.1016/j.autcon.2009.10.004
Dikmen, I., Birgonul, M.T. and Han, S. (2007), “Using fuzzy risk assessment to rate
cost overrun risk in international construction projects”, International Journal of
Project Management, 25(5), 494-505.
Field, A. (2005), “Discovering Statistics Using SPSS” (2nd edition), Sage, London.
Gunhan, S and Arditi, D. (2005a), “Factors affecting international construction”,
Journal of Construction Engineering and Management, 131(3), 273-282.
Gunhan, S and Arditi, D. (2005b), “International expansion decision for
construction companies”, Journal of Construction Engineering and Management,
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Hayes, R.W., Perry, J.G., Thompson, P.A., and Willmer, G. (1986), “Risk
Management in Engineering Construction”, Thomas Telford Ltd., London, UK.

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Ozorhon, B., Dikmen, I. and Birgonul, M.T. (2007), “Using analytic network process
to predict the performance of international construction joint ventures”, Journal
of Management in Engineering, 23(3), 156-163.
Pallant, J. (2005), “SPSS Survival Manual: A Step by Step Guide to Data Analysis
Using SPSS Version 12” (2nd edition), Open University Press, New York.
Sonmez, R., Ergin, A. and Birgonul, M.T. (2007), “Quantitative methodology for
determination of cost contingency in international projects”, Journal of
Management in Engineering, 23(1), 35-39.
Yemar Report (2009). “Report on the Turkish Construction Sector”, Yapi Endustri
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AA070

Microblogging in Project Management: Improving Project

Communication and Documentation with Status Information

Dirk Röhrborn
(CEO, Communardo Software GmbH, Dresden, Germany)

Martin Böhringer
(Research Assistant, Chemnitz University of Technology, Chemnitz, Germany)

Abstract
Microblogging represents a significant change in enterprise communication, shifting
from a push to a pull model where information consumers subscribe to relevant
information sources. Especially scenarios with high degrees in information quantity
and complexity may benefit from this approach. This is the case for project
management, which can well be supported by microblogging tools. This paper
introduces the technology’s concept, motivates use cases and discusses two
examples as well as available software tools.

Keywords
project communication, enterprise microblogging, networked communication,
project documentation, team collaboration

1. Introduction

In recent years, modern Web 2.0 tools are being widely used in business. The
successful service Twitter.com shows how the new approach of microblogging – the
public distribution of short text messages – simplifies information sharing and
collaboration of distributed teams. This paper has been written to help project
managers to understand and successfully apply the principles of microblogging to
improve project and team communication.

Following the simple principles of Twitter, microblogging is now also being used as
a new means of communication in projects within and across professional
organizations. Besides the support of information exchange via short messages,
tagging – the simple assignment of keywords to pieces of information – becomes
the core mechanism to foster project information and knowledge management.

Based on two years of practical experiences with microblogging in the IT and

research sectors, this paper shows how microblogging can help to improve project
communications substantially. Initially, the core elements and usage patterns of
microblogging and the resulting paradigm shift from direct to networked
communication will be explained. The benefits of microblogging for project
management include higher transparency and responsiveness, support for self-
organized and highly mobile teams, continuous documentation and networking
between team members and stakeholders.

Further, the paper defines requirements for microblogging services and tools. Based
on real-life project cases, the authors explain and demonstrate emerging patterns
for communication, collaboration and documentation processes in project
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microblogs. A brief comparison of microblogging software vendors and evaluation

criteria helps with the selection of appropriate tools.

Finally, the paper discusses the effect of widespread use of microblogging on the
communication culture within project teams. A guideline for successful introduction
of microblogging within project teams concludes the paper.

2. Microblogging and Project Management

2.1 Basics of Microblogging

Microblogging is a technology deriving from the public internet. It’s most famous
example is the free service Twitter, which has defined the understanding of
microblogging. This section starts with briefly introducing the concepts of Twitter-
like services. Further, it discusses the applicability of microblogging in project
scenarios before it finally gives an overview on available software solutions and
selection criteria.

Microblogging can be seen as paradigm shift in communication principles (Barnes et

al. 2010). Members have their own public microblog where they post short updates
without having to address them to a special addressee. Other users can be
‘followed’ by adding them to one’s personal network. An aggregated view of all
updates by followed microblogs appears in chronological order on the user’s start
page. Microblogging services often support a wide range of contribution
possibilities. For example, messages to Twitter can be posted via mobile text
messages, desktop clients or several third-party applications (Java et al. 2007).

2.2 Status-quo of IT-support in project communication

Today, IT-tools are being widely used to support project communication in business
environments. While telephone and email are most common, also web-based
communication tools, e.g. web document management systems, wikis and weblogs
have been introduced especially to support distributed project teams. Happ et. al.
(2006) provide an overview of web 2.0 tools in use for project management. The
main concern of these web-based tools lies in the central storage and distribution of
important, mainly formal documentation.

However, many important pieces of information are being transmitted informally or

ad-hoc by means of voice, instant messaging, paper notes or small e-mail
messages from one person to another. These mainly small pieces of (micro)
information then reside in personal mail boxes, locally stored log files and such like.
As a result, they are neither accessible by other team members nor can they be
easily retrieved at a later point in time. To overcome this problem, email
distribution lists are being used to keep the whole project team informed. This
however, commonly leads to the information overload phenomenon.

Hence, there is a need for a new means of communication that overcomes these
shortcomings by providing an easy to use, structured, persistent and team-wide
accessible virtual workspace for the exchange of short messages. The objective of
enterprise microblogging is to fill this gap.

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2.3 Microblogging in Project Management

Microblogging does not have a single use case. It can be characterised as typical
web 2.0 platform technology which does support basic user activities which can be
applied by users for their special needs (O’Reilly 2005). Therefore, it is hard to
provide a universal definition for microblogging which could be applied to project
management. A more promising approach is to discuss certain characteristics which
can be observed at Twitter and other existing microblogging services. The following
table summarizes the so derived main characteristics of microblogging and
discusses their effects in business-related and project-oriented environments:

Simplicity The use of microblogging is simple and easy to learn due to the
similarity to SMS, email and instant messaging.
Simplicity is the key success factor to achieve a high degree of
end user acceptance. The effort for their creation must be minimal
since the size of messages is usually very small.
Equality and All users in a microblogging platform are communicating on an
openness equal basis. In most cases, everybody can read or write
messages. Messages are not directed to single persons but can be
read by anybody instead, even by customers or suppliers if they
have access to the system.
This openness is the key to lowering the effort for information
distribution within the team. This can lead to reduced work loads
for project managers regarding this task.
Self-organised The users themselves are adding structure to the microblogging
content content by assigning tags (with prefix #) to their notes. In
structures projects, project leaders or teams regularly define common tags to
be used.
Through user tagging, content structures are being adapted to
changing situations on the fly without extra effort.
Task-related Team members usually write short messages about their current
messages project work. This includes status updates (task started, in
progress, finished), problem reports, brief documentation of
decisions taken, information on current events, etc.
Projects require a strong focus on their goals and the tasks
defined to achieve these goals. Therefore, the use of microblogs
must focus mainly on these tasks.
Shortness Our case data (c.f. chapter 3) shows that microblogging messages
contain in app. 75% of all cases less than 200 characters, in other
cases messages are somewhat longer.
To avoid overloading the project team members with too much
information shortness is a necessity. Through this, it becomes
much easier for all team members to stay up to date with the
ongoing of the project.
However, a restriction to 140 signs like on Twitter often is not
recommendable for enterprise scenarios.

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Conversations Problem solving and decision making often require the direct and
timely exchange of facts and opinions between multiple actors.
Therefore, communication in microblogging is often very
conversational. Current issues are being discussed in near real-
time using the reply feature. This regularly includes valuable
contributions from people that have not been addressed initially.
Confidentiality Even if the main principle of microblogging is its openness, an
important requirement in projects is to provide a communications
space restricted to the project team. This is especially important in
cases where non-disclosure agreements have to be obeyed.
Informality Formal communication is being conducted by means of face-to-
face conversations, meetings, email and written letters. In project
environments, microblogging is often used for the rather informal
ad-hoc communication within the team.
Table 1: Characteristics of microblog-based communication in projects

Microblogging bundles the various short messages that have formerly been
communicated via other means, e.g. email, instant messages or paper notes.
Through this, information that was locked up in personal inboxes before is now
instantly available to the entire project team and archived for later reference.

2.4 Software Tools for Project Microblogging

Since the launch of Twitter1 in 2006 there were many similar projects developing
microblogging tools for different usage scenarios. Significant activity can be
observed in the context of so-called enterprise microblogging tools, which especially
focus on the internal use in organisations, e.g. for project management. The
market of these tools is manifold, as lots of vendors entered it in 2009 (c.f.
Böhringer et al. (2010) for a market overview).

A basic criterion of distinction between the different tools is their business model.
There are offerings based on SaaS (software-as-a-service), classical licensing, and
open source with some vendors offering several models. It strongly depends on the
project context which subscription model might fit best. For a smaller project with
limited duration a hosted SaaS solution would be a pragmatic and fast
implementation approach. However, for long-time projects or critical microblogging
contents (knowledge, confidential data) this model might be too unreliable. Here,
behind-the-firewall solutions based on an own installation of a license or open
source product might be the best choice. While the advantages of SaaS can be
found in the speed of implementation and lower cost for small projects, an own
installation offers data security, access control and governance and enables
integration scenarios.

Classical SaaS providers of enterprise microblogging systems include Communote2,

Present.ly3, Socialcast4, Socialtext Signals5, Wizehive6 and Yammer7. The three

1
www.twitter.com
2
www.communote.com
3
www.presentlyapp.com
4
www.socialcast.com
5
www.socialtext.com
6
www.whizehive.com
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solutions Communote, Present.ly and Yammer are available as behind-the-firewall

installation, too. The same goes for open source products like ESME8 and
StatusNet9. We suggest using three criteria in order to separate different
approaches in functionality of the available tools: information management
philosophy, potential for integration and security.

Based on existing market studies (c.f. Böhringer et al. 2010) there can be identified
two different underlying information management philosophies: micro-messaging
vs. micro-sharing. The representatives of micro-messaging understand
microblogging as simplified web-based instant messaging. The focus is on speed
and communication. While being very easy to use, these tools focus extremely on
timely messages and therefore harden access to older information. On the other
hand, micro-sharing focuses on providing reliable mechanisms for information
structuring and filtering. Examples include Twitter-like hashtags (i.e. “#PM05”) or
groups. The figure below compares these two approaches in showing a micro-
messaging (Socialcast) and a micro-sharing (Communote) tool. Socialcast has a
very simple front-end which only offers a full text search, while the more complex
tool Communote leverages a filter column (right) with multiple search options like
keywords, tags, authors and time.

Figure 1: Micro-messaging and micro-sharing compared

The support of integration scenarios is another important criterion in tool selection.

Depending on the project context it might be necessary to integrate microblogging
with other software tools like wikis, project plans or portals. Vendors differ in the
type of integration support (e.g. none/API programming/ready integration widgets
and portlets) and range of available functionality.
Finally, in the context of project management, safety is an important criterion. In
choosing a SaaS model, compliance with existing data protection regulations might

7
www.yammer.com
8
incubator.apache.org/esme/
9
www.status.net
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be necessary. Further, especially in an emerging market such as enterprise

microblogging, it is likely that there will be a wave of consolidation. Therefore an
export function seems to be particular important in order to prevent information
loss in the event of a service’s closure. Encrypted communications, secure RSS
feeds and integration with existing authentication systems (e.g. LDAP) are other
functional requirements related to security.

3. Real World Microblogging Cases

The following chapters illustrated how microblogging is being used in project

environments in the IT sector and in research organisations. Other enterprise
microblogging use cases are for example published by Ebner & Schiefner (2008),
Reinhardt (2009), and Zhao & Rosson (2009).

3.1 Microblogging in IT Projects

Communardo Software is a medium-sized software vendor and IT services provider

focusing on portal solutions for communication and collaboration for enterprise
clients. Communardo has been using their self-developed microblogging platform
Communote for app. 18 months, especially to support informal project
communication in software development projects but also for team communication
in the marketing, sales, human resources, research and internal services areas.
Currently 88 users are writing to app. 150 microblogging groups. More than 20.000
messages have been counted since system launch. On average, every user writes
at least one posting per working day. However, the usage intensity varies
depending on the role of the user within the firm. The following screen shows an
example from Communardo’s internal microblogging system:

Figure 2: Microblogging example from a software project

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The use of microblogging has changed internal communication at Communardo.

Communote has grown to become the leading project-internal means of
communication, whereas the use of email has been reduced significantly. Project
wikis and web document management systems are being further used, especially in
situations where in-depth documentation is being generated collaboratively. Email
is being used mainly for written communication with customers and suppliers as
well as internally for personal messages that need to be addressed to specific
individuals.

3.2 Microblogging in Research Departments

Microblogging is a tool for organising and sharing information snippets and

knowledge. Therefore it is especially suited for usage in knowledge-intensive
scenarios. Given this, universities are an ideal context for such applications.
Research departments are usually project-organised and employees typically are
involved in a multitude of parallel projects (individual courses, student projects,
practical projects, research projects). A major challenge is the integrated
management of various types of information and the creation of a mutual
awareness of the knowledge and the current work tasks of colleagues. The business
information systems research team at Chemnitz University of Technology leverages
microblogging for this task since the beginning of 2009.

Within the first year 57 users consisting of researchers, students and external
stakeholders posted 3365 notices in 105 thematic groups. The microblogging tool
can be considered to be the central information sharing hub. It thus reduced the
team-internal email communication. Microblogging is used by team for two main
use cases: The first use case is team-internal collaboration within the various
projects. Individual projects will receive a special group, where external
stakeholders can be added and user rights can be awarded. These groups are the
place for a wide variety of project-related content like discussions, action logs, task
delegation, information snippets and link recommendations. The indexing of the
content (tagging) is widely used and enables the subsequent access to tagged
information resource. The project groups are open to all core members of the
research team so that each researcher is informed about the activities of
colleagues.

The second application of microblogging in the research group is a special type of

project blogs for student projects. For project works, seminar papers and
bachelor/master dissertations theses special groups are created with access for the
supervisor and the student. This mechanism of information organising is especially
useful for the supervisor, who can see all the details of his supervised work in an
integrated view and can leverage filtering. This eliminates time-consuming
searching and forwarding of emails and memos.

4. Conclusions

Microblogging still is a very new technology. While it is the youngest member in the
Web 2.0 family, it made significant impact on research and practitioners yet.
Gartner (2009) forecasts the diffusion of microblogging in many enterprise
systems. Our analysis showed that especially project management is an ideal
domain for systems supporting information sharing and structuring. Therefore,

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easy-to-use and fast-to-deploy microblogging tools could be a useful part of a

project’s IT infrastructure.

5. References

Barnes, S. J.; Böhringer, M.; Kurze, C.; Stietzel, J. (2010), „Towards an

understanding of social software: the case of Arinia”, Proceedings of HICSS-43,
Kauai, HI, January 5-8, 2010. IEEE Computer Society.
Böhringer, M.; Gerlach, L.; Lang, A.; Hauptmann, S.; Pham, M. (2010), „Enterprise
Microblogging Study 2010 (#EMS10)“, http://ubimic.org/en/enterprise-
microblogging-study-ems10/.
Ebner, M.; Schiefner, M. (2008), “Microblogging-more than fun?”, Proceedings of
IADIS Mobile Learning Conference (Vol. 155, p. 159).
Gartner (2010), „Gartner Highlights Four Ways in Which Enterprises Are Using
Twitter”, http://www.gartner.com/it/page.jsp?id=920813.
Happ, S.; Wünsche, A.; Röhrborn, D.; Henkel, F. (2006), “Blogs, Wikis, Webcasts:
Utilization of State-of-the-Art Communication Instruments for Project
Management”, PMI Global Congress EMEA, Madrid.
Java, A.; Song, X.; Finin, T.; Tseng, B. (2007), “Why we twitter: understanding
microblogging usage communities”, Proceedings of the 9th WebKDD and 1st
SNA-KDD 2007 workshop on Web mining and social network analysis, 56-65.
O’Reilly, T. (2005), „What Is Web 2.0“, http://www.oreilly.de/artikel/web20.html,
retrieved 2009/11/12.
Reinhardt, W. (2009), “Communication is the key – Support Durable Knowledge
Sharing in Software Engineering by Microblogging”, Proceedings of the SE2009,
Workshop SENSE. 2009.
Zhao, D.; Rosson, M. (2009), “How and Why People Twitter: The Role that Micro-
blogging Plays in Informal Communication at Work”, Proceedings of the ACM
2009 international conference on Supporting group work (p. 243–252).

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AA076

Consulting company practice in providing of project management

specialists by masters education program

Dmitry Sadkov
(Deputy Director, IBS, Moscow, Russia)

Alexandr Tovb
(Vice-President, IPMA, Moscow, Russia)

Grigory Tsipes
(Chief Consultant, IBS, Moscow, Russia)

Abstract
IBS is a biggest Russian IT system integrator and consulting company - undoubted
national leader in this area. As a project oriented modern consulting company it
requires a large amount of advanced specialists with high level of competences in
all fields of IT, consulting and management, particularly in project management. To
provide such specialists IBS established its own Magistracy with Masters Education
program in cooperation with worldwide known Moscow Institute of Physics and
Technology (MIPT – “Fizteh”) and Moscow Institute of Steel and Alloys (MISA). To
meet specific requirements of IBS project and product portfolios not only the
master’s course on project management, but also wider context of all Masters
Education program was developed. Special topics of project management are
included in various disciplines of the program on information management,
economy and finance, strategic and operational management etc.

Keywords
Project management, Consulting, Masters Education program, Accreditation,
Certification

1. Business model of education used by IBS

Almost twenty-year history of IBS clearly showed the shortcomings of traditional

education programs of Russia's universities for the specialists in the field of
management and information technology. Almost every graduate who join the
company showed incompetence to participate fully in the work process. It would
take a long period of retraining and additional education, which negatively
influenced the financial performance of the company and, last but not least, the
morale of the young colleagues.

As the strategic initiative to solve this problem IBS established the system for
targeted education and training of university graduates in key areas of information
technology and consulting. This education and training system realised in the form
of the Master's education programs organised on the base on the innovative model
of public-private partnership of IBS and leading Russian state universities.

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A key element of realised IBS model of business education, presented at Fig.1, are
the production units (departments) IBS, which serves several important functions in
the processes of recruitment and training of students.

IBS MIPT – “Fizteh” MISA

Moscow Institute of Moscow Institute of Steel
Departments Physics and Technology and Alloys

Faculty Institution of
IBS Academy «Information business Information business
systems» systems

Processes of intaking of students and learning by Magistracy program

Fig 1: IBS Business education stakeholders

Schematically, these processes are as follows:

 IBS departments are forming the requirements for necessary competencies and
make an order for the required number of Masters Education programs
graduates.
 Specialised department of the company (IBS Academy) consolidates the
requirements and orders and, together with the 2 leading Russian universities
(MIPT and MISA) creates curricula and programs.
 Corporate faculties (departments or institutions) of business information
systems, created with IBS in the MIPT and MISA (leading universities in Russia),
are organising and providing education and training process according with the
Masters Education programs.
 IBS business departments are actively involved in the education and training
process in various forms: by providing a full-time teachers and trainers, by
establishing and staffing cathedras of faculties. For example, the cathedra of
management consulting almost entirely staffed by experts from IBS
Management Consulting Department.
 IBS departments ensure student participation in research and commercial
projects, provide materials necessary for preparing of Master's theses. Upon
completion of part of education and training, students enrolled in staff of IBS
departments.
Thus, IBS Business departments being customers of education and training are fully
involved in the education and training process and able to promptly effect on this
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process, which is especially important during the formation of Master's education

programs.

2. Project management as a key competence of any IBS employee

Project management was recognized as one of the disciplines fundamentally

important for the consulting business specialties. There are three main reasons for
project management is given in IBS as so important (see Fig.2).

PROJECTS

Management consulting PROJECT MANAGERS

Finance consulting specialized in consulting and IT
Strategic consulting projects
IT consulting
HR consulting г

PROJECT MANAGEMENT
PRODUCTS
CONSULTUNTS
Project management standards
specialized in project
Project management systems management
Project office
Outsourcing of Project management

PROJECT-ORIENTED COMPANY
STAFF
Organizational structure
understanding the main principles
Financial structure
of organization and functioning of
Business processes project-oriented company
Motivation system

Fig 2: Competences in Project Management required for consulting company

First of all, IBS offers services in various areas of consulting - IT consulting,

management consulting, financial consulting, strategic consulting, HR-consulting -
realising annually several hundred projects of various scale and complexity. This
means that one of the most in-demand positions in the company is professional
project managers. However, taking into account the specificity of business, except
those general knowledge and skills they have to have more and more specialisation
in the field of consulting and information technology.

In addition, project management is not only a way of doing IBS business, but it is
strictly IBS business – in the company's portfolio there are a number of products in
the field of project management. This requires appropriate knowledge, skills and
experience of the consultants associated with the development and implementation
of corporate standards and project management systems.

Finally, knowledge of and ability to use to certain extent of project management

methodology, approaches and tools, understanding of the basic principles of

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organization and functioning of project-oriented company is important for all IBS

staff, since all the company's activities are implemented in the form projects.

Unfortunately, much of the criticism for the incompetence of university graduates is

regarding their poor education in project management. This, in particular, is due to
the fact that the curricula of most universities in this field in its infancy, and the
specialty itself "Project management" is still not recognized by the Russian Ministry
of Education and State Higher Attestation Commission.

Due to this situation and based on the requirements for the competence of the IBS
staff in project management, not only the course of project management was
formed, but also the general context of the entire Master's program. Special issues
of project management are included in the various disciplines in information
technology, economics and finance, strategic and operational management, etc.

3. Project Management course for Masters Education program

The aim of the course "Project management in modern company” is the formation
of students' holistic comprehensive understanding of methodology, instruments,
tools and techniques of modern professional project management, international and
national standards and on the basic principles of their use in the project-oriented
companies, as well as on approaches to implementing project management
systems on the basis of the enterprise project management standard.

The overall logic of the course, presented on Fig.3 in the form of "roadmap" is
constructed in such a way as to consistently provide answers to the most important
questions raised by many experts, involved in project oriented business activities.

First of all, this is the question "Why - project management?" Answers are
described in the introduction part of the course. There are analyses of the main
advantages, reasons and factors of success of professional project management, its
current state as a professional discipline in the world and in Russia.

Then we try to give a sufficiently short answer to the question "What project
management is?" This is dedicated to the first part of the course, which highlighted
two sections. The first section describes the main provisions of the methodology of
project management, international and national standards in this area, as well as a
glossary of project management. The second section provides a brief overview of
the development of project management models.

Next question - "How does the project-oriented company organized?" – is devoted

to the second part of the course. It examined the role and capability of project
management in the practice of modern companies. Material of this part of the
course is based on experience and research of the IBS. Various models of project-
oriented companies are considered - organizational, process, economic (Sadkov and
Tsipes (2008). The key themes of this part are also are issues of harmonization of
project and process approaches (Tsipes and Tovb (2005, 2009-2)), the role of
projects in the strategic management of the company (Tsipes and Tsiperman
(2006, 2008)), assessment of project-oriented activities (Tsipes (2004)), Project
Management Office.

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If project management is not seen as speculative doctrine, but as a practical tool, it

is very important to find the answer to the question "How force it to work?" In the
third part of the course the principles of development and implementation of a
corporate standard for project management are discussed, covering all major levels
of management - from policy to operational standard. As the through prevailing
case, here we consider the project management standard of IBS company, the
actual which evolving since 2000 (Tovb and Tsipes (2005)).

And finally, last question - "How does it work?" - is devoted to the fourth section of
the course. Here, the general principles and practical examples of the development
and implementation of project management systems in the Russian and foreign
companies. Majority of the examples drawn from the IBS practice on development
and implementation of project management standards and systems at various
companies (Tsipes and Tovb (2007)).

Working program of the course includes 32 hours of lectures and 46 hours of

workshops, case studies and master classes. Especially for this course is designed
textbook (Tsipes and Tovb (2009)) and a set of instructional materials totalling over
500 pages.

Project management - Introduction. Projects and Project management in modern world

why?

Project management – what is it? Part 1. Fundamentals of Project Management

(Lectures)
The main ideas Formalized model

Part 2. Corporate Project Management

(Lectures, Laboratories)
How does project-
oriented company
organized?
Part 3. Corporate Standard of Project
Management
(Lectures, Seminars, Practice)

How force it to work?

Part 4. Projects in practice

(Lectures, Cases, Seminars)

How does it work?

Examination, Practice in IBS projects, State examination

Fig 3: Roadmap of educational course "Project management in modern company”

4. Project management course in the general context of Masters

Education program

Project management course is in the first semester. Throughout the first year of
study, students also receive additional education and training on the project
management methodology and tools in related courses. The overall structure of
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master's training program consists of six blocks of disciplines, which are closely
related and strongly linked to the course "Project management in the modern
company" (see Fig.4). Consider some of these links.

System engineering
Economy and
and Information
Finance
technologies
Learning

Operational Quality
management management

Strategic and
Human resources
Corporate
Project management
management
Management
Practice and Science

Academic projects

Commercial projects of
IBS

Magistracy dissertation

Fig 4: General structure of IBS Master's education program

Course of the strategic management and corporate governance allows more deeply
immerse in issues of strategic project management. In particular, this course
considers in details modern technology of strategic management based on Balanced
Scorecard methodology, possibilities and ways of its application to governance of
branch of industry and corporate programs and portfolios of development projects.

Operations Management Course focuses on situations where it is necessary to

combine various organizational, methodological and software tools of the project
and process management in a single system in accordance with unified corporate
rules and regulations.

Students are receiving a plenty of information on project management in the course

unit "Information technology". It details the specific IT industry standards for
project management, especially for organization and life cycle of IT projects, the
principles of activities of IT service unit in modern organisation as a unit that
combines project and operational activities, etc.

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Other blocks of disciplines that are shown in Fig.4 can better address the project
cost management, project human resource and personnel management, project
quality management, encompassing a wider context of corporate governance and
management.
Much attention in the program is paid for the establishment and development of
students' practical skills in project management and for work in project teams (see
Fig.4). The first practical skills acquired in the scientific research projects carried
out by students during the first year of training. In the second year students as IBS
interns are already working in commercial projects of the IBS company. The results
of these projects are the basis for preparations of master's theses, including theses
on topics of project management. Typically, the dissertation research directly
related to the needs of IBS in the development and improvement of product
portfolio.

Control of education and training is carried out in various forms, and the final is
certification for entry level of knowledge and skills in project management as part
of the Master's degree state controlled examination.

IBS Master's education and training program was accredited by Russian

Management Association SOVNET and received its official confirmation of
compliance to IPMA ICB version 3 and SOVNET NCB requirements.

All students who successfully passed the Master's degree state controlled
examination and defended his master's thesis, and receive an appropriate SOVNET
certificate.

5. First results and lessons learned

IBS Masters education and training program operates from 2007. For three years
recruitment has increased 2-fold (from 40 to 80 people), and the rate of contest
(entrance exams and interviews) - more than 3 times. Plan for the year 2010 is to
intake 140 people to Magistracy.

Today, two generations of graduates of the IBS Academy are working in the
company – as a consultants and interns (trainees). Expectations of IBS
departments in project management competencies of young staff are mainly met.
Being students they can easily be included into the project teams and do not
experience serious stress from work in a matrix organizational structure, where
they need to be engaged in several different concurrent tasks.

It is too early to made definitive conclusions, but it may be noted for sure that we
can see significant success of young employees in projects related to consulting in
the field of project management and clear faculty of future project managers.

The experience gained has allowed us to identify specific ways to improve the IBS
Masters education and training program in project management. Main point among
these is the increase of practical side of program and amount of materials from the
actual practice of the company.

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6. Acknowledgments

We are sincerely grateful to all big team, carrying out the IBS Master's program, for
the invaluable assistance rendered to us during the preparation and development of
the course "Project management in modern company, and, above all, prof. A.
Silantiev, prof. M. Nezhurina, Dr. I. Shcherbinina, Dr. V. Babeshko, Dr. N.
Echkalova and all other colleagues.

7. References

Sadkov, D. and Tsipes. G. (2008) “Project-Oriented Approach to Building a

Consulting Business. Russian case”, in: Project Management to Run. The
Proceedings of 22th World Congress on Project Management, IPMA 2008.
Vol.2., Roma, p.934-939
Tovb, A. and Tsipes, G. (2005) “Project Management: Standards, methods,
practice”, (2rd edition), Olimp-Business, Moscow (in Russian)
Tsipes, G. (2004) “To manage projects thru key performance indicators”, in: 18th World
Congress on Project Management, IPMA 2004, Budapest
Tsipes, G. and Tovb, A. (2005) “Processes and Projects – There and Back Again”,
in: Vision to Reality – the project management way. 19th World Congress on
Project Management, IPMA 2005, Delhi
Tsipes, G. and Tovb, A. (2007) “Project Management in practice of modern
company”, Olimp-Business, Moscow (in Russian)
Tsipes, G. and Tovb, A. (2009-1) “Harmonization of Project and Process
Approaches. A Case of Modern IT Company”, Projects and Profits, 01, 39-47
Tsipes, G. and Tovb, A. (2009-2) “Projects and Project Management in modern
company”, Olimp-Business, Moscow (in Russian)
Tsipes, G. and Tsiperman, G. (2006) “Political aspects of IT projects”, in: A Key to
the Innovation Age. The Proceedings of 20th IPMA World Congress on Project
Management, Volume 1. China Machine Press, pp.409-412
Tsipes, G. and Tsiperman, G. (2008) “Strategy and Politics in IT System
Implementation Projects”, Projects and Profits, 12, 54-62

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INV-1

IPMA Moving Forward

Brigitte Schaden
(President of IPMA, Austria)

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AA063

Limits to professional Project Management

David Shannon
(Managing Director, OPM Ltd, London, UK)

Abstract
This paper considers some of the factors influencing the development of
professional project management. Some important limiting factors are identified.
It is intended thereby that:

 A more realistic context will be used for developing the profession

 Plans for the profession’s development will be more robust
 The global cost-benefit of project management will be enhanced

The content derives from extensive relevant personal experience as well as from
wide reading of relevant texts. The topic is broken down into four main elements:
external, internal, inherent and future.
The paper is designed for presentation rather than as an academic record of
research, although reference is made to previous publications.
Although trends and limits are suggested, no firm conclusion is drawn. Rather,
further consideration along similar lines is proposed.

Keywords: professional, constraints, project management, future.

Keywords
Project management, Mediterranean, Conference, Greece

1. Introduction

This paper derives from lengthy involvement by the author in professional

organisations in the UK. I am a chartered professional member of two
organizations and am a non-chartered member of other professional organisations.
In addition I have been involved in many of the activities preparing the premier UK
project management organisation, APM, for chartered status, a step that will
significantly raise the professional standing of project management in the UK. I
have also taken a leading role in the development of national project management
qualifications for the UK.

Although it takes therefore a UK centric view the paper is informed by experience of

managing projects and teaching project management to a variety of curricula
internationally including in countries bordering the Mediterranean, as well as by
wide reading on the topic.

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2. External context

Ur in Mesopotamia, modern Iraq, is often called the oldest city in the world. Dating
back some 5,500 years it is full of projects such as ziggurats, temples, elaborate
burial chambers and drainage works. Minoan civilization here in Crete emerged
about the same time and we will all I hope learn more of their masterful, and
seemingly more peaceful projects, whilst we are guests on this island.

The great pyramid at Giza in Egypt is younger at about 4,700 years old. Its
construction is supposed to have required some 130,000 workers over the full 23
year reign of its creator Cheops. Did this need project managing? Even more
demanding was the creation of the Ajanta Caves in India filled with exquisite
craftsmanship. Said to be the greatest project in the history of the World, these
were started about 2000 years ago and took some 500 years to build. Were
professional project managers used? Jet Magsaysay, (July 1999)

In the UK we have Stonehenge, one of the most recognised monuments in the

World. This dates back 4,000 years when stones weighing over 45 tons were
erected and some brought from 385km away. Earthworks around the same site are
much earlier, with one long barrow burial mound dated as from 6,000 years ago.
Clearly long distance and astronomical surveying was an important part of the skills
required at the time. Were these surveyors also the early project mangers?

Figure 3 The Long man of Wilmington, Sussex, UK

Is this 70 metre high figure cut into the chalk hillside at Wilmington, Sussex, said
by some to be a surveyor in fact the first representation of a professional project
manager?

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Proceeding from this ancient speculation we arrive at 1680 CE. According to the
first English novelist, Daniel Defoe, this is the year of the “birth of the monster” of
projecting humour. He admits that no age has been altogether without something
of this nature but considers this date as the start of a new type of enterprise. He is
more polite elsewhere in the referenced text, saying that “about 1680 began the art
and mystery of projecting to creep into the world.” Defoe, Daniel, (1697).

Figure 4 Daniel Defoe, 1659 – 1731

Incidentally, Defoe also characterises the building of the tower of Babel as

complying with the true definition of a project, ie a vast undertaking, too big to be
managed, and therefore likely enough to come to nothing. He also says of
unsuccessful projects what we have often heard since “it only miscarried, or else it
would have succeeded” a view which professionalism is surely trying to make
obsolete.

Over the centuries we have seen great projects undertaken successfully with no
public recognition of unique separate qualities required of their managers. In such
fields as military fortifications and civil engineering these management skills were
considered part of the primary profession.

This raises a current issue. How can professionalism of project management be

harmonised between those seeking it primarily as a portable trans-sector skill and
those who intend to practice purely within one application area, such as IT or
construction? In this latter group we can list relevant professional organisations
with project management subgroups in surveying, engineering, architecture and
computing. We should note also that a programme and project management
Diploma qualification is offered by the UK Chartered Institute of Management, and
that this can help towards achievement of Chartered Manager status.

Interestingly the UK Government issued in 2003 the National Occupational

Standards for Project Management which is cross-sectoral and provides the basis
for qualifications from about Diploma level to Masters level. APM was directly
involved in this initiative as were some of their senior members. ECITB (2003)

3. Internal

Within the project management discipline we have the well known players such as
IPMA, PMI and powerful country specific agencies such as the UK’s Office of
Government Commerce who issue their own standards as well of course as national
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project management organizations such as PM-Greece. In the last few decades

considerable progress has been made towards professionalisation. The number of
project managers worldwide certificated to either PMI or IPMA standards in 2007
was considered as 325,000. Chritophe Bredillet and others (2010)

From IPMA, the ICB sets out the knowledge and experience expected from the
managers of projects, programmes and project portfolios. It contains basic terms,
practices, methods and tools for professional project management, as well as
specialist knowledge and experience. IPMA (2010). The baseline competences are
allocated under three headings: technical, behavioural and contextual. These are
then used to define four levels of project management competence to which some
90,000 people are now certificated according to the IPMA, 2009 4th Quarter
Newsletter.

Figure 5 IPMA PM certification levels

This certification pattern is followed by most member associations including by APM

in the UK.

Progress to highest professional status for a profession may be said to follow five
steps which could well take more than 10 years. These are:

1. Organised – a recognised community of practitioners

2. Qualified – a qualification regime applies
3. Governed – the field is governed by a framework of institutions
4. Public – the profession meets its public obligations
5. Statutory – the profession is regulated by law for the benefit of the public

As part of its strong push up this progression of increasing professionalism the APM
has defined five dimensions of professionalism as the focus for much of its effort.
Association for Project Management, (2010) These are:

Breadth
The APM Body of Knowledge defines the knowledge needed to manage any kind of
project. It underpins many project management standards and methods including
the National Occupational Standard in Project Management.

Depth
The APM Competence Framework provides a guide to project management
competences. It is part of your professional toolkit; mapping levels of knowledge
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and experience to help you progress your skills and abilities. It is linked to the APM
Body of Knowledge 5th edition and the International Project Management
Association (IPMA) - International Competence Baseline (ICB v3.0). APM (2008)

Achievement
APM qualifications take your career in new and exciting directions. They are
recognised across the profession and aligned with IPMA’s 4 level Certification
Program.

Commitment
Continuing Professional Development helps develop your project management
practice. A targeted development plan will enhance your project management
career.

Accountability
The APM Code of Professional Conduct outlines the ethical practice expected of a
professional. Becoming an APM member shows your commitment to the Code and
sets you apart from others.

It should be noted in relation to sector specific project management that APM, with
17.500 individual members has formal relationships with such organisations as the
Royal Institution of Chartered Surveyors. One of the RICS’s faculties is Project
Management in the built environment which has 30,000 members, albeit these can
opt for up to four faculties each.

Professionalism standards are difficult to transfer internationally. For example,

recent research highlights differences in behaviour between two European
countries, The Netherlands and France. The Dutch culture, focusing on consensus
as a decision making process, is contrasted with the French métier culture, focusing
on the quality of the result rather than on process control. The referenced paper
explores how this difference impacts on project management practice. Jaqueline de
Bony. (2010) Increasing professionalism globally must therefore pay full regard to
national cultural differences.

Of significance in the issue of the penetration of project management in any society

is the number of qualified project managers. This has been analysed for 2007 by
country in relation to various measures including GDP. Greece is among the High-
GDP countries for which correlations of project management deployment, ie the
ratio of the number of qualified project managers to the population is negatively
related to Hofstede’s power distance and uncertainty avoidance scores. On power
distance Greece scores 60 in a range of 11 (Austria) to 104 (Malaysia and Slovakia)
whilst on the uncertainty avoidance measure Greece has the highest score of 112 in
a range of 8 (Singapore) to 112. Other cultural variables, such as individualism
and masculinity/femininity were found to be not significantly correlated. The
conclusion of this paper also is that project management deployment policy in a
country should take into consideration the correct cultural dimensions. Despite the
high Greek uncertainty avoidance score, it would still seem that Greece had then
considerable potential to increase its certified project management deployment. If
it were to achieve the same penetration as say Portugal the number of certified
project managers would increase sixfold. Chritophe Bredillet and others (2010)

Related research has examined the use of standards in project management

covering process standards as well as competence standards. This finds that
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standards are rarely used in project management organisations. Where used it is

mainly to harmonise terminology. They are seldom used as an unmodified
template but more often applied in part or as a pool of ideas. Major problems are
that their implementation leads to too high costs and the lack of acceptance
amongst practitioners. Professional standards will therefore need to be user
friendly and be well marketed to the user community. Frederik Ahlemann and
others (2009).

4. Inherent

An important point regarding professionalism is the difference between membership

of a professional body and being a registered professional. Some professional
bodies do not maintain a register of professionals with particular competences,
merely keeping a list of members fulfilling the core requirements.

Typical activities of a professional body are:

 Define the core body of knowledge

 Define route to professional status
 Certify organisations as well as individuals using assessment panels
 Re-accreditation practitioners, typically using a continuous personal
development process
 Serve the public as well as members
 Ensure fee and open competition in the practice of the profession
 Protect the independence of practitioners
 Educate practitioners’ customers
 Comply with a governance process to maintain and govern standards
 Apply a research capacity to develop the Body of Knowledge, standards,
qualification and best practice in the light of changes such as in technology
and regulations
 Maintain and enforce codes of conduct
 Approve education and training products
 Cooperate with relevant organisations nationally and internationally
 Provide leadership and obtain recognition as representative of their
profession.

One difficulty to be addressed in relation to project management is the variety of

roles and specialisations in the profession. This includes project team member,
project manager, project sponsor, projects director, PMO manager and risk
management, procurement, earned value, planning and cost control. Any
comprehensive certification system should allow for recognition of these roles and
subjects as well as for differing grades of programme and project manager.

Another feature of project management, as for any management qualification, is

the distinction between personal based competence and functional competence.
This may also be described as the difference between task behaviour and
contextual behaviour. The latter which is difficult to measure directly may account
for some 30% of the variance in managerial performance. Divine Kwaku Ahadzie
and others (2008). These attributes of competency have some similarity with
Machiavelli’s use of the terms Virtu as examined by Miles Shepherd (2006).

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All good schemes of professionalism require the use of codes of conduct and ethical
behaviour. However it should be recognised that there are major difficulties in
applying codes where the country concerned suffers from poor governance
standards. In this respect the Global Governance Index is relevant. This takes into
account for each country measures of:

 Voice and Accountability

 Political Stability and Absence of Violence
 Government Effectiveness
 Regulatory Quality
 Rule of Law
 Control of Corruption
There is little progress that one emerging profession can achieve in a context that
is hostile to professional behaviour.

5. Future

Even after taking into account the various considerations and constraints noted
above, planners for greater professionalisation of project management should
consider future uncertainties. As project managers we often need to test our
models of long term projects against future scenarios. Substantial further
professionalisation of project management requires a time horizon of at least 10
years. Some of the uncertainties likely to arise over this timescale are noted
below.

 Project management taught to secondary level at all schools.

 Project management becomes the major subset of general management.
 Operational business is increasingly seen as just a phase of a longer project.
 What are now considered complex project management procedures and
calculations become widely understood and available to non specialists. Note
that Tom Peters, the well known management thinker, is quoted as saying
one hundred percent of everyone’s’ time should be taken up by projects. Jet
Magsaysay (1999)

 The common project management concepts and terminology as used in ICB

and PMBoK are superseded by substantially different multi-cultural and
language variations, for example in non-Indo European languages.
 Artificial intelligence replaces much project management decision making.

 Widely adopted cultural change to simple sustainability with few major

projects, many of these focused on low impact technology.
 Inter-country cooperation breaks down with few effective international
institutions.
 Nations and international agencies no longer form the basis of cooperation
and conflict which are instead based on widespread groups not linked to
countries.
 Military force becomes the major agent of change.
 Disaster and disease lead to a major reduction in world population.

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Any plans for increased professionalisation should be tested against scenarios

additional to ones that are either stay-as-you-are or just more-of-the-same. These
additional scenarios should take account of such factors as those listed above.

6. References

Association for Project Management (2008) Competence Framework

Association for Project Management, 2010 http://www.apm.org.uk/ and
http://www.apm5dimensions.com/node/632
Chritophe Bredillet and others 2010 Project management deployment: The role of
cultural factors, , International Journal of project Management 28 (2) 183-193
Defoe, Daniel, 1697, An essay upon projects, The Scolar Press Limited, 1969
Divine Kwaku Ahadzie and others 2008Towards developing competency-based
measures for construction project managers: Should contextual behaviours be
distinguished from task behaviours?, International Journal of project Management
26 (6) 631-645.
ECITB, 2003 British National Occupational Standards for Project Management
Frederik Ahlemann and others 2009 Project management standards – Diffusion
and application in Germany and Switzerland, , International Journal of project
Management 27 (3) 292-303
International Project Management Association. 2010 www.ipma.ch
Jaqueline de Bony. 2010 Project management and national culture: A Dutch-
French case study, International Journal of project Management 28(2) 173-182
Jet Magsaysay, July 1999 World Executive Digest, Page 4
Miles Shepherd, 2008.Does fortune favour the bold? Proceedings of the 22nd IPMA
World Congress, Rome

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AA016
Client’s Critical Success Factors in Outsourcing of Construction
Projects
Case Study: Tehran Municipality

Mohammad Ali Haghnazar

(Ph.D. Student, School of Management and Economics, Sharif University of
Technology, Tehran, Iran)

Dr. Mehran Sepehri

(Associate Professor, School of Management and Economics, Sharif University of
Technology, Tehran, Iran)

Abstract
To counter the competitive forces in the market, many firms re-evaluate their work
by focusing on core competencies and increasing their outsourcing. Due to the
project based nature of the construction industry identifying and evaluating key
success factors will help top managers in implementation of successful outsourcing.
These organizations primarily aim to finish their projects based on a defined scope
of time, budget and quality, while accepted by the final customer.
In this paper, a conceptual framework was defined based on literature review and
interview with experts’ panel. Key factors related to the success of outsourced
project were evaluated quantitatively in one of the largest project-based Iranian
organizations, by using a questionnaire for one of their recent construction projects.
Results show that successful implementation of outsourcing strategy in construction
projects is strongly influenced by the level of coordination with the contractor, the
contractor selection, clear project objectives, well defined technical tasks and
client's top management support.

Keywords
Outsourcing, Client, Contractor, Project management, Critical success factors

1. Introduction

With more competition in business environment, the necessity of utilizing other

organization’s competencies and skills is appreciated to provide maximum demands
and requirements of clients with the minimum total costs. So besides increasing
competition power of organization and agility of organization’s activities, the
possibility of increasing innovative potency and gaining competitive advantages will
be provided.

Different definitions for outsourcing have been submitted. According to Aalders’

definition, decision of an organization in respect of offering and/ or sale assets,
human resources and services to a third party is called outsourcing in which the
contractual party undertakes to provide and manage the required assets and
services in the contract against defined income and in a certain time (Aalders
(2002)). Nowadays industrial and business managers try to use outsourcing
strategy; however, they encounter various challenges and problems. Managers and
their consultants are trying to identify these problems to use outsourcing in a more
effective manner (Thomas and Fernandez (2008)). Although widespread studies in
respect of outsourcing literature have been conducted, still a comprehensive
procedure for outsourcing decision making has not been developed (Vining and
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Globerman (1999)). In this circumstance development of a comprehensive and

systematic approach for decision making in respect of outsourcing and way of
performing could be very effective in reducing risk of such decision. If set of factors
most influencing on success of outsourcing of projects become demonstrated, both
clients and contractors with awareness of those factors will be able to more
effectively cope with the challenges in the projects and be influential on successful
conduction of them. Success of a project is an abstract concept and the recognition
of success or failure of a project is very complicated (Chan (1996, 1997)).
However, project success concept could be assessed by performance measurement
defined with various factors in different contexts.

Key success factors are the concepts that should be considered precisely to ensure
success of a manager and a project. In other words, key success factors are limited
complex of factors that their existence ensures the survival and success of an
organization or an outsourcing project (Clarke (1999)). Since 1960 decade project
management researchers have endeavoured to identify the factors resulting in
project success. Perhaps it could be said that key success factor approach is the
best identified approach for restraining human and organizational aspects of
projects (Fortune and White (2006)).

Researches on project success factors show that preparation of a comprehensive

list of these factors suitable for all projects is impossible. Because of unique
features of each project, success factors differ from one project to another
(Westerweld (2003)). This issue is true for outsourcing projects, too. In this regard
many researchers endeavored to identify these factors in special contexts and with
various approaches. Regardless of approaches and contexts, the mentioned key
success factors are shown in the below table:

key success factors key success factors

Actual schedule Top manager's support
Risk identification and assessment Clear and actual objectives
Project sponsor/hero Adequate budget
Organizational structure/ culture Involvement of consumer/ client
Appropriate performance of Adequate resources/ allocated
suppliers/contractors/ consultants appropriately
Training Effective change management
Political stability Competent project manager
Project size/ complexity/ period of Skilled/ eligible team
project
Environmental influences Appropriate leadership
Selection of right method/ tools

Table 1: Review of proposed success factors in project success factors literature

(Fortune and White (2006))

Pinto and Slevin (Pinto and Slevin (1986)) studied project success factors from
several approaches in their ten-factor model of project success. Fig. 1 shows the
framework of project performance on the basis of ten project success factors.

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Fig 1: framework of ten-factor model of project performance (Pinto and Slevin

(1986))
Pinto and Slevin in their proposed model considered success factors and their
relation and correlation with the project success from the sight of project team
including project team members and project manager. The proposed models of
Pinto and Slevin were developed in great construction projects environment. In
Pinto and Slevin’s Model, seven factors: top manager support, project mission,
planning, consultant with client, personnel, technical tasks, client’s acceptance are
influential subsequently and procedurally on project success during life cycle of the
project, and three factors of communication, problem solving and monitoring and
feedback are simultaneously influential on success in all stage of project from the
contractor’s sight. In table 2, the definitions of ten success factors are shown.

1. Project Mission Clearly defined objectives and general guidelines

2. Top Management Willingness of top management to provide required resources
Support and adequate authority/power for project success
3. Project Planning Elaboration of activities
4. Consultant with Communication, consultant and listening actively to all vital
Client members
Recruitment, selection and training of required personnel for
5. Personnel
project team
Availability of required technology and expertise for performing
6. Technical Tasks
all defined technical activities
7. Client Acceptance Act of selling the final project to final consumers
8. Monitoring and
Comprehensive control in each steps of execution process
Feedback
Providing adequate network and data for all key parties in
9. Communication
execution of the project
Ability to manage unforeseen crisis situations and deviation
10. Problem Solving
from plan

Table 2: Factors definition (Pinto and Slevin (1986))

The ten-factor Model of Pinto and Slevin created a new approach in project success
factors context which, since then, has known and utilized as a reference in
researches of this field (Anderson et al. (2006), Belout and Gauvreau (2004)) . One
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of the research fields in project management is study of client and contractor

relationship in outsourcing of construction projects that most researches in this field
focused on feasibility, advantages and disadvantages of outsourcing (Bryde and
Robinson (2005)). Currently there are few researches which clearly distinguish
between clients and contractors’ role in outsourcing project success (Bryde and
Robinson (2005)), and in the related literature, the necessity of systematic
research has been mentioned (Chan et al. (2003)).

With regard to construction projects’ role in industrial developments of countries,

successful conduction of these projects has a great role in economical growth of
countries. Since the Pinto and Slevin’s Model has been developed in construction
project environment, it is appropriate to be used in this research. The ten-factor
model of Pinto and Slevin is considered as a primary model in conducting of this
research and the endeavor is to study key success factors in outsourcing of
Construction projects from the client sight for Tehran Municipality as case study.

2. Research Method

The research method of this paper is case study and applied research type. For
assessment of key success factors in Construction projects, first introduced factors
in Pinto and Slevin’s Model were selected as initial model in semi-structured
interview sessions with experienced experts, in order to identify the success factors
from the client approach in these interviews. The relation between factors obtained
from interview with experienced experts and project success are examined through
distribution of questionnaire. In this theoretical model, success means completion
of a project in a defined time, quality and cost which finally being approved by
client.
Since the objective of this paper is to identify the key success factors in outsourcing
of construction projects, the dependent variable is success of outsourcing of
construction projects.With regard to dependent variable and result of interviews
with experts, independent variables of this research are key influential factors in
success of outsourcing of construction projects: Mission and objectives of project
(M), support of client’s top manager (S), selection of contractor (C), technical and
specialty tasks (T), communication management with client (R).

Since Tehran Municipality is one of the best samples of utilizing outsourcing

strategy in construction projects in Iran, the domain of this research is Tehran
Municipality. In this research key success factors of outsourcing of construction
projects are identified and assessed in Tehran Municipality as a client of
construction projects. Statistical population of this research is managers,
supervisors, and technical experts of construction department of Tehran
Municipality. The studied projects were ones which have been completed and were
of the most recent experience of statistical population.

2.1 Data Collection

In this research the method of sampling is according to clustering and Snowball

methods. Tehran Municipality includes 22 zones. So initially 5 zones of these 22
zones were selected by random sampling. Then in each zone, by the Snowball
sampling, three of informed people in construction department were selected
randomly for interview and they have been asked to introduce the other informed
people. These interviews continued until saturation of information. Due to the

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request of this organization to not disclose the name of projects and the
interviewees in the research, their name will not be mentioned.

In continue and in the section of quantitative research, after designing the

questionnaires as for results of interviews, the questionnaires were distributed
among all managers, supervisors and experts of construction department of these
selected zones of Tehran Municipality. The total number of distributed questionnaire
was 115 and 88 people of the statistical sample answered to questionnaire. With
regard to the framework of model, the data collection tools in this research are
interviews with the related expert panel and also questionnaires.

2.2 Validity of Research Measurement Tools

In this study for consideration of validity, content validity and face validity were
evaluated. In the face validity we consider whether the experts verify that the tools
are measuring what is inferred from their name (Khaki (2000))? To measure the
face validity, the questionnaire and its content were considered by ten experts and
their comments were applied.
Content validity shows that how the description of dimensions and components of
concept is (Khaki (2000)). For designing of the questionnaire, with regard to strong
history of models and also with consideration of main models’ variables, the
endeavor was to apply element measurement indexes which are based on
appropriate theoretical and their practical application in numerous researches and
tests.
Since in this study, the questionnaires were provided with regard to expert panel’s
opinion, its validity were evaluated by one of the common methods for
measurement of the questionnaire's content validity which was introduced by Mr.
Lawshe in 1995. In this method, before distribution of questionnaires, its content
validity was considered by ten of experts through mentioned method, and its
content validity ratio (CVR) was calculated 0.74. Considering the number of experts
(10), the calculated content validity ratio is more than the least content validity
ratio (0.62).

2.3 Reliability of Research Measurement Tool

In this study, also, the test–retest method is used to estimate the reliability. Based
on test–retest method Cronbach’s Alpha coefficient was estimated equal to 0.819
which is above 0.7 and within the acceptable criteria.

3. Presentation of Results

Based on multivariate linear regression, the direct effects of independent variables

on dependent variable are presented in the form of Table 3.

Estimation of Estimation of
Relation Direction Standard Standard’s t
Parameter Error
From Project’s Mission and
0.596 0.083 6.888
Objective to Project Success
From Client’s Top Management Support to
0.456 0.081 4.757
Project Success
From Contractor Selection Method to
0.633 0.057 7.584
Project Success
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From Technical and Specialty Tasks to

0.489 0.081 5.195
Project Success
From Communication Management with
0.749 0.075 10.469
Contractor to Project Success

Table 3: Direct effect of independent variables on dependent variables

3.1 Result Interpretation of the table of direct effects of

independent variables on dependent variable

Value of t indicates that the assumed paths from independent variables of model to
dependent variable, including project’s mission and objective, client’s top
management support, contractor selection method, technical and specialty tasks
and communication management with contractor on project success is meaningful.
Therefore, the correspondent assumptions regarding each path are verified.

The total amount of Linear Correlation explaining project success through forecaster
variables of mission and objectives of project, client's top management support,
selection of contractors, technical tasks and communication management with
client was 0.860.

4. Conclusion

Hypothesis' Test Results are as below:

 Hypothesis I) Project Mission and Objective have effect on Project Success.

The statistical result hypothesis indicates that the mission and objectives of the
project has a positive and direct effect on project success. In fact, by clarifying
mission and objectives of the project for contractor, the probability of project
success will increase.

The intention of mission and objectives of project structure is the circumstances in

which the project objectives are not only clear for client, but also clear and
understandable for the contractor. Project success is defined as performing a
project within determined time, quality and cost that ultimately being approved by
client (Pinto and Slevin (1986)).

Comparison of test results of hypothesis with Researches of King and Cleland (king
and Cleland (1983)), Baker et al. (Baker et al. (1983)), Pinto and Slevin (Pinto and
Slevin (1986, 1988)) and Morris and Hough (Morris and Hough (1987)), which have
accepted the direct and positive relationship between project's mission and project
success, indicates that this hypothesis test results are consistent with previous
research results.

 Hypothesis II) Client’s top management support has effect on Project

Success.

Client’s top management support structure means type and size of support which
the contractor expects from client’s top management (Pinto and Slevin (1986)).
The client’s top management support can comprised of cases like project finance
(on time payment to contractor) or support and leadership of system in
determining and allocating projects and solving substantial problems.
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Comparison of test results of hypothesis with Pinto and Slevin’s researches (Pinto
and Slevin (1986, 1988)), which have accepted the direct and positive relationship
between top management support and project success, indicates that this
hypothesis test results are consistent with previous research results.

 Hypothesis III) Contractor selection has effect on Project Success.

Contractor selection structure refers importance of method of selecting appropriate

contractor, like recruitment, for outsourcing of project.

Comparison of test results of hypothesis with researches of King and Cleland (king
and Cleland (1983)) and Pinto and Slevin (Pinto and Slevin (1986, 1988)), which
have accepted the direct and positive relationship of recruitment, selection and
training of personnel with project success, indicates that this hypothesis test results
are consistent with previous research results, of course from Client's perspective.

 Hypothesis IV) Technical and specialty tasks have effect on Project Success.

Comparison of test results of hypothesis with researches of King and Cleland (king
and Cleland (1983)) and Pinto and Slevin (Pinto and Slevin (1986, 1988)), which
have accepted the direct and positive relationship of technical tasks and availability
of required technologies with project success, indicates that this hypothesis test
results are consistent with previous research results, of course from Client's
perspective.

 Hypothesis V) Communication management has effect on Project Success.

Communication management with contractor means a reciprocal and continuous

relation and communication with contractor (Pinto and Slevin (1986)).

Comparison of test results of hypothesis with researches of King and Cleland (king
and Cleland (1983)) and Pinto and Slevin (Pinto and Slevin (1986, 1988)), which
have accepted the direct and positive relationship between communication
management with contractor and project success, indicates that this hypothesis
test results are consistent with previous research results.

5. Summary

In this research, the endeavour was to consider and identify the effective factors on
success of outsourcing of construction projects with use of comprehensive model of
five-factor presented in theoretical framework. To do this research after semi-
structured interviews with construction department’s experts of selected zones of
Tehran Municipality zones, a questionnaire was developed and sent to 150 other
informant people in construction divisions such that at last 88 analysable
questionnaires was received.

These research constraints were that the ten factors model of Pinto and Slevin was
the input of interviews. So the output of these meetings was influenced by this
selection and all interviewees was consider as same.

To achieve the final model, after reviewing the existed literature and interviews
with experts, the model variables were analyzed. At last the model was finalized
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and the result was that these five factors (communication management with
contractors, contractor selection method, project’s mission and objectives, technical
and specialty tasks, and client’s top management support) affect on outsourcing
projects’ success from client perspective and need more special and continuous
attention from client’s managers.

6. References

Aalders, R. (2002), ‘The IT Outsourcing Guide ‘ (2nd edition), John Wiley & Sons, Ltd. ,
England.
Andersen, E. S., Birchall, D., Jessen, S.A. and Money, A.H. (2006), ‘Exploring project
success’, Baltic Journal of Management, 1(2), 127-147.
Baker, B.N., Murphy, D.C. and Fisher, D. (1983), ‘Factors affecting project success, Project
Management Handbook’, Van Nostrad Reinhold, New York.
Belout, A. and Gauvreau, C. (2004), ‘Factors influencing project success: the impact of
human resource management’, International Journal of Project Management, 22, 1–11.
Bryde, D. J. and Robinson, L. (2005), ‘Client versus contractor perspectives on project
success criteria’, International Journal of Project Management, 23, 622–629.
Chan, A.P.C (1996), Determinants of project success in the construction industry of Hong
Kong, unpublished PhD thetsis, University of South Australia, Adelaide.
Chan, A.P.C (1997), ‘Measuring success for a construction project’, The Australian Institute
of Quantity Surveyors – Referred Journal, 1(2), 55-59.
Chan, A.P.C., Chan, D.W.M. and Ho, K.S.K. (2003), ‘Partnering in construction: critical
study of problems for implementation’, Journal of Manageant Eng. ,19(3), 126–35.
Clarke, A. (1999), ‘A practical use of key success factors to improve the efectiveness of
project management’, International Journal of Project Management, 17(3), 139-145.
Currie, W. (2000), ‘The supply side of IT outsourcing: The trends toward mergers,
acquisition and joint ventures’, International journal of physical distribution & logistics
management, 30(¾), 238-254.
Fortune, J. and White, D. (2006), ‘Framing of project critical success factors by a systems
model’, International Journal of Project Management, 24, 53–65.
Khaki Gh. (2000), ‘Research Method in Management’, Azad University publication, Tehran.
King, W.R. and Cleland, D.I. (1983), ‘Life cycle management, in Project management
handbook’, Van Nostrad Reinhold, New York.
Morris, P.W. and Hough, G.H. (1987), ‘The anatomy of major project’, John Wiley and Sons,
New York.
Pinto, J.K. and Slevin, D.P. (1986), ‘The project mplementation profile : New tool for project
managers’, Project Management Journal, 18(4), 57-71.
Pinto, J.K. and Slevin, D.P. (1988), ‘Critical success factors across the project life cycle’,
Project Management Journal, 19(3), 66-75.
Thomas, G. and Fernandez, W. (2008), ‘Innovation risks of strategic outsourcing’,
International Journal of Project Management, 26, 733–742
Vining A. and Globerman, S. (1999), ‘A conceptual framework for understanding the
outsourcing decision’, European Management Journal, 17(6), 645-654.
Westerweld, E. (2003), ‘The Project Excellence Model1: linking success criteria and critical
success factors’, International Journal of Project Management, 2, 411–418.

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AA091

Project Management Societies and Profession

Miles Shepherd
(Hon Senior Research Fellow, University College, London,UK)

Denise Bower
(Professor in Engineering Project Management, University of Leeds, UK)

Abstract
This paper argues that professions are a form of occupational control. Traditional
professions have exercised this control based on a common acceptance of their
contribution towards society. However, newer professions, including Project
Management, may not share the characteristics of traditional professions but have
been able to exercise occupational control by exerting power, influence and status
through professional bodies and their occupational strategies. As the use of
projects has grown, so too has the view that project workers may be regarded as
professionals and join organisations that mimic the structure and ambitions of
professional bodies. The influence project management associations can exert can
be seen as unhelpful to the overall development of the discipline being seen as
restrictive if not coercive. This paper examines three models from which a set of
key characteristics needed to establish occupational control is drawn. The main
implications for the potential of project management as a profession are centred on
adjusting occupational strategy and control.

Keywords
Profession, Occupational Control, Occupational Strategy

1. Introduction

Many observers view project management as the dominant approaches to the

organisation of work (see inter alia Lundin and Söderholm 1998, Cicmi and
Hodgson 2006). A wide range of industry sectors make use of projects (Winch
1996, Morris et al 2006, Cicmil & Hodgson 2006). Project management has spread
from its traditional base in defence, oil and gas, construction and engineering into
sectors as diverse as education, IT, media, health care, and social services
(Hodgson 2002). More and more employees find themselves redefined as ‘project
workers’. One result of this ‘projectification’ of work is that participants may
consider themselves to be part of a profession and as a consequence, join
organisations that mimic the structure and ambitions of professional bodies (Midler
1995). Certainly the expansion of the project form of management has coincided
with a remarkable period of growth in the membership of project management
associations (PMAs) and this growth underscores the importance attached to
project management (Morris et al 2006). The rise of ‘projectification’ has reignited
the debate about the potential for project management to develop into a
profession, a positioning with implications for the roles of both practitioners and
professional societies.

A number of fundamental questions need to be addressed: ‘Is project management

a profession? Can project management develop into a profession? What role can

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professional bodies play in the growth of the project management profession and
professionalism in project management?’ These are not necessarily new questions.
However, the status of project management is disputed with some (e.g. Turner [no
date given] and 1999) claiming that project management is already a profession
while others take the opposite view. There is also doubt that the achievement of
‘profession’ status is either desirable or achievable (e.g. Hodgson 2002). The
purpose of this paper is to provide insight into the potential for project
management to develop into a profession.

2. Project Management, Professional Bodies and Professionalism

In modern times, the role of knowledge has been at the centre of the debate
around professionalism and project management (e.g. inter alia Abbott 1988,
Evetts 2003, Cacciatori and Jacobides 2005, Siegrist 2002). The development of
project management bodies of knowledge (BOKs) has led some observers to claim
professional status for the discipline. However, the lack of a coherent underlying
theory has been seen as a major stumbling block for the more traditionally minded.
For example Koskela and Howells (2006) argue that ‘the development of a body of
theory is typical of a well-established profession’ and Turner (1999) claimed that for
project management to become a mature profession it is necessary to develop the
theoretical basis of the subject through professional institutions. Morris et al (2006)
discuss the relationship between professions and knowledge in the context of
project management and conclude that a distinctive and discrete knowledge area
plays a significant role in the growth of a profession. In a study on the
development of project management as a profession, one key aspect that Fugate
and Knapp (1998) found was that all well-established professions, such as law,
medicine and accounting, have unique of bodies of knowledge. Zwermann et al
(2004) conclude that mastery of an ‘esoteric and distinctive body of knowledge’, is
a key requirement in the quest for professional status. Koskela and Howell (2006)
claim that the lack of a well grounded theory is a major contributor towards the
frequent project failures. For some, reliance on the theoretical is a key factor
distinguishing a profession from a craft.

In his examination of project management as a profession Hodgson (2002)

concludes that attempts to construct project management as a profession are
dependent upon its development as a discipline, not only in the sense of a ‘field of
objective scientific study’ but also as a ‘form of training and control’. For Hodgson,
a key element is the strict enforcement of a body of knowledge with consistent
terminology specific to project management that eventually marginalises the ‘non-
professionals’ who do not conform to the project management model. This
conclusion has significant implications for the perception of project management as
a form of occupational control.

A major challenge in both the research and practice of project management is the
lack of consistency and uniformity in terminology. Although there is general
consensus on the common features of projects and project management, use and
understanding of terminology varies widely and there is no single and consistent
all-encompassing definition (Pinto 2007). For example, the definition of ‘project’ in
British Standard 6079 differs markedly from that of APM (2004). The diversity of
terms and concepts within the discipline may be drawing to an end as the
International Standards Organisations develops an overarching International
Standard (ISO 21500).

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At present, it is clear that the main professional societies define project

management terms differently (e.g. Archibald 2003, PMI 2006, 2008). Such
inconsistency has implications for communication in research and practice since
definitions are often linked to mindsets and philosophies (Martinsuo and Lehtonen
2007). Of course, it could also be argued that a progressive profession with an
emerging and ever evolving knowledge base would have differences in terminology
and these would be normalised as international agreement was achieved.

It is evident that development of project management associations (PMA) is

partially hinged on the relationship between a unique body of knowledge and
professional growth. Some claim that the reification of project management
embeds a technicist view that hinders development and distorts views of its
effectiveness (Cicmil and Hodgson 2006). Furthermore, critics point to the diversity
of language indicates a lack of maturity of the discipline and thus its unsuitability
for consideration as a profession.

3. Contrasting Views of Professions

In parallel with the emergence of ‘projectification’ over the past 20 years or so, the
concept of professionalism has undergone substantial and critical revision (e.g.
Dingwall and Lewis 1983, Durkheim 1992, Evetts 2003 and Freidson 1994 among
many others). Competing and changing views of the nature and value of
professionalism have emerged but its appeal remains strong (Fournier 1999).

The distinction between professions and trades has been noted since the time of
Cicero and was also noted by Shakespeare. More recently, Abbott (1988) set out
the characteristics of professions, drawing on work by Bourdieu (1984) and Moline
(1986). Moline’s discussion of the differences between a professional body and a
trade organisation identify the ‘ideal’ profession, examples of which might be
Medicine or Law. Emerging from these considerations is a notion that there exists a
spectrum of occupational form that extends from the uncoordinated, individual
tradesman on the one hand, through informally controlled trade bodies, state
controlled registration schemes, what Etzioni’s (1969) calls ‘semi professions’ to
traditional professions on the other. Evetts (2003) traces the development of
modern concepts of ‘professions’ and concludes that the different interpretations
may be grouped under the categories of professionalism as normative value system
based on (presumably) positive contributions towards society and social order; and
professions as ideology; rooted in occupational control.

Critical studies in the 1950s and 1960s tended to interpret most forms of
professionalism as the result of occupational power and market monopoly (e.g.
Freidson 1970). This view of profession through occupational control has, as Evetts
(2006) argues, been largely replaced by a return to traditional views of
professionalism as normative value system. She also notes other directions in the
analysis of professions: these more cautious views recognise the underlying
perception of professions as knowledge based service occupations driven by new
knowledge areas. The reasons for this change are diffuse but seem to originate
from concept that the differences between occupational groups, and especially
professions, is more one of degree than kind (Evetts 2006). Thus the idea of
ranking professions, semi professions (Etzioni 1969) and crafts is seen as
unproductive.

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Other views of professions include the ‘traits’ approach and the control view. The
former views professions as occupations that have particular ‘traits’ that distinguish
them from other occupations. Various authors list these traits (e.g. Roach Anleu
1992, Hugman 1996) which usually include formal educational and entry
requirements, control over a discrete body of knowledge and related skills,
autonomy over the terms and conditions of practice, a code of ethics and a
commitment to service ideals. This view is problematic since it was difficult to
determine the differences between professions and expert occupations (Wilensky
1964 and Etzioni 1969).

The control view sees professional institutions as governing most or all of the traits,
thus erecting barriers to entry through prescribing entry requirements. By
controlling these barriers, they also control continued access to professional
standing through continuing educational requirements, credentialing activities,
ethical behaviour and (sometimes) performance standards. Thus according to
Hugman (1991) power is at the centre of understanding professionalization while
for Aldridge (1996), this relates the power of the occupational group to the demand
for its service in the market place (1996 p201). Claims to professional status are
thus strategies for exerting organisational control (Aldridge 1996, Roach Anleu
1992).

As observed by Morris et al (2006), project management draws little of its

legitimacy by reference to its contribution to the public good, to an ideal social
service, or by adherence to an overarching ethical code. It therefore seems
reasonable to conclude that any form of professionalism in project management
would be achieved through occupational control and therefore, it is crucial that the
project management associations have strategies to achieve professional status. As
discussed later in this paper, the potential exists to exert considerable influence on
stakeholders and society at large; thereby elevating the status of project
management as a profession. Conversely, this also underscores the vulnerability to
changing perceptions and influence over the key stakeholders.

There are a number of models that explore the concept of occupational control.
These include: the Neo Weberian model, Johnson's typology of occupational control
models, and the Cruciality/Mystique model. These are briefly discussed and the
implications for project management are highlighted.

3.1 Neo Weberian Model

This model adopts a market oriented approach based on social closure on market
forces in which professionalization is viewed as an exclusionary closure of the
market place using credentials as the major mechanism (Saks 1983). In its
general form credentialism creates signals, conventionalised bits of information
about the capacity and skill of a worker offering labour in the market place
(Freidson 1987). The most impressive form of credentialism works to produce an
occupational cartel, which gains and preserves monopolistic control over the supply
of a good or service. The most visible method of establishing an occupational
monopoly lies in licensing, a process by which a government agency grants
exclusive official permission, sustained by law, to eligible individuals.

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3.2 Johnson's Typology: Institutionalised Strategies

This model focuses on the consumer-producer relationship and the way structural
uncertainty is reduced (Johnson 1972). It suggests three, not necessarily mutually
exclusive, strategies for occupational control. It links professionalisation and other
occupational control strategies directly with a basic market variable, namely, the
consumer - producer relationship. The three models of occupational control are
Collegiate, Patronage, and Mediation.
According to the collegiate view, professionalism is a form of collegiate control
where the professional body acts as a registering body, where the producer-
consumer relationship are controlled by means of an institutional framework based
on occupational authority. Power is exerted through sanction mechanisms to control
occupational and non-occupational behaviour.
Where consumers define their own needs and the manner in which they are met,
the patronage model may be established. Its significance is dependent on the
degree to which practice is defined by the patron as opposed to the occupation.
Where fully developed, the professional elite works for the more powerful
corporations, either as consultants or as employees. Advancement in the
occupational hierarchy will normally be by association with increasingly powerful
patrons. Corporate patronage is characterised by less stress on the pursuit of basic
knowledge than by emphasis on knowledge specifically related to the needs of the
patron.
Under the mediation view, occupational control is exerted when State intervenes in
the client practitioner relationship and defines the needs and the manner by which
these needs will be metr. Thus the state attempts to remove from both the
producer and consumer the authority to determine the content and subject of
practice. This type of occupational control is prevalent in areas such as health care.
In these areas, the government has a political responsibility to ensure that health
services are accessible to the whole population.

3.3 The Cruciality- Mystique Model

According to Haga et al (1974), a combination of cruciality and mystique defines a

true profession. The greater the degree of each possessed by an occupation the
greater its status as a profession. An occupation possesses cruciality when the
service provided is seen as vitally necessary to prosperity or survival. The more
crucial the matter is perceived to be, the greater the tendency to seek out the
particular profession that has a monopoly over it. The mystique of a profession
creates authority relationships between the participants. The consumers of the
service know the problem to be beyond their own comprehension, both in terms of
ability and knowledge. Professions having high cruciality and mystique wield
maximum professional power. Others, considered to have low mystique and low
cruciality can not rely as heavily on professionalism as a source of power in the
market.

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Mystique
Low High
Low Maximum Constraint on Possess some form of mystery and are not
aspirations to professional status among the irrevocably damned
E.g., public relations, librarians E.g., watch-making, astrology, science at
Cruciality

technical level

High The most active strivers. Lacking The true profession.

in perception of the need for
mystique. Workplace may not
allow this to develop.
E.g., teaching, journalism, E.g., law , medicine, dentistry, architecture
business management and accounting

Figure 6 Cruciality - Mystique Matrix (after Haga et al 1974)

In a sense all of these models contribute towards the notion of professionalism as

an occupational strategy. Occupations strive to improve their market position and
power through actions to professionalise their occupation. This sometimes brings
aemerging profession into direct competition with other groups which are
concurrently striving to acquire recognition in a particular field. The competition
between traditional professions such as accountancy and business management on
the one hand and project management on the other exemplifies such a situation.. It
is evident from the models that in addition to the knowledge base, superior
positioning may be obtained by emphasising the political and economic actions that
allow the profession to gain recognition.
At individual practice level, it concerns the manner in which association with a
particular PMA enhances the professional status of an individual. In this sense
professional status is a sine qua non for the individual and more recently the
corporate member operating in the market. This aspect of professional status is
more clearly understood by considering the implications of the above models.
Occupational control as discussed in the various models is based on the three
primary attributes of influence, status and power that a profession can exert on key
stakeholders. Exclusive knowledge, skills and competence form the core of the
potential to exert occupational control. However, the individual with the necessary
initial professional education and ongoing professional development operating
within a grouping of a professional body with a clear occupational strategy will find
it easier to thrive.

4. Discussion and Implications for Project Management

In sociological studies of professions and professionalism, there is no mention of

project management and Zwerman and Thomas (2001) note in a preliminary report
for the Project Management Institute (PMI) that under many definitions of
profession, it does not qualify for inclusion. Furthermore, in many countries, it is
not even recognised as an occupational grouping for statistical reporting purposes.
However, in UK, the professions are expanding rapidly. Hodgson (2007) reports
that almost 400 UK-based ‘professional associations’ were listed in a recent report
(Perren, 2000), and that around 7 million people, or 27%, of the UK working
population are now identified as professionals or associate professionals (ONS,
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2004). This represents an increase of 2 million (7% of the working population)

over the 1998 figures. Many of these ‘professions’ lie outside the traditional
professions; as Hodgson notes, existing as either semi-profession in the same
sector or as part of the emerging groups of organisational or entrepreneurial
professionals (Larson, 1977; Reed, 1996). So there is clearly demand for
recognition of emergent occupations as professions. The US based Project
Management Institute (PMI) has as its mission ‘to further the professionalization of
project management’. Zwerman et al reported that PMI provided a research grant
‘to explore the lessons that can be learned from the development of the traditional
professions and the activities of other knowledge based occupations in pursuing
professional status in society’.
Each of the notions of profession brings its own difficulties for the occupational
body. Nevertheless, the concept of professions as occupational control systems is
attractive since it is straightforward to see what actions are needed to establish
occupational closure. The difficulty comes with building the barriers to entry and
exerting market closure effectively without support from either major users of the
service or from government.
Most accounts of profession recognise the role of knowledge in achieving
professional status and most also note the importance of education. Traditional
professions frequently refer to their ‘body of knowledge’ and tend to include in this,
the range of text books, research publications, reference books and journals that
make up the recorded knowledge of their field of interest. Discussions of the
nature of knowledge (e.g. Noneka and Takeuchi 1995) extend the ‘body of
knowledge’ to what is known but not recorded so it is reasonable to consider that
there must also be a significant body of tacit knowledge linked to any profession.
Further, mastery of this body of knowledge is generally accepted as one the major
characteristics of individuals claiming to hold professional status. In the traditional
professions, the body of knowledge is seen as extensive, segmented and not under
the ownership of any particular organisation. However, in the case of project
management, the PMAs have defined their own ‘Bodies of Knowledge’ (BoK) and
claim ownership, hence PMBOK® (PMI 2008) and others (e.g. APM 2006). The
nature of these BoKs and their implementation have been criticised (see for
example, Cicmil and Hodgson 2006), mainly on grounds of narrowness and the lack
of research supporting them. Others (e.g. Shepherd and Johns 2006) see a case
for their use to support other activities in the professional field, while Morris (2006)
notes the need of practitioners and users of projects for BoKs. Whichever view is
taken, there can be no doubt that many university courses are based closely on
BoKs and this too is a cause for concern (Winter et al 2006).
The functionalist view of professions developed by Parsons (1964) and others see
professions as fulfilling distinct organisational forms separate from other middle
class occupations which support social order. In this view, professions contribute to
society because of shared cultural orientation and social psychological convictions
rather than leaving social order to administrative mechanisms of social control and
commercial incentives. In other words, the ‘profession as value system’ is stronger
than the more commercial perspective. Sciuli (2005 p916) argues that claims
under this view are unsubstantiated and further, the functionalist school fails to
adequately delineate the link between professions and the benefit they bring to
society.
Freidson (1987) believes the professions serve the important function of managing
conflict and crisis in society. By undertaking this function they, and society, are
part of an interdependent network. He argues that professions make claims,
demand unique privileges; and in return, have to perform in accordance with public
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expectation, a problem for PMAs where performance is frequently seen as

suboptimal. Furthermore, professions do not exist as a single entity. Instead, they
consist of a dozen or a few hundred or many thousands of individuals who differ as
widely as all other human beings, yet who, as professionals are expected to act in a
standard manner.
Haga et al (1974) claim that professionalization is a two way process. The
occupation must take action to become a profession but the public at large must
accept it as such. The action usually taken may involve a combination of
establishing ethical standards, establishing full-time educational establishments and
organising around occupational associations that will probably certify competent
practitioners. These efforts are a set of intentional actions by a group of people
aspiring to a favourable position in the surrounding social and economic
environment. Zwerman et al (2004) extend the range of actions to include gaining
control over the name of the ‘profession’ and the establishment of professional
societies.
Adapting to new roles and increased competition for members requires most
‘professional’ societies to adopt a strategic approach to planning for their future.
Diverse specialisation within a single profession is increasingly common but one
that is barely evident in the main PMAs. Watkins (1999) argues that it is one of the
key roles of professional bodies to pull all the diverging strands of the profession
together. The issue of whether, and how, to create specialist divisions will be a key
concern for professional bodies in future. Members who specialise will want
recognition or they are likely to form their own competing membership association.
As the knowledge base of the professions continues to grow and develop in
established areas, new specialist areas will continue to emerge. The danger is that
their acceptance may erode the unified face that is of crucial importance to
influence, power and status. Generally, where fragmentation has taken place the
advantage derived from it is not clear and it is often a regretted decision: this is the
point made by Hodge (NCE 2006) in relation to the construction industry. In many
professions the effect of this trend has been that professional bodies have failed to
provide a unified voice and so have been powerless against the effects of
consumerism, managerialism, market forces and government intervention over
deregulation.
For example in UK construction and property sector, the influences of the various
Monopolies and Mergers Commission reports that abolished mandatory fee scales
and pushed for delivery of professional services on a competitive fee tendered basis
had an adverse effect on the influence on Quantity Surveying and Architectural
professions (MMC 1977, MMC 1978). These changes relegated these professions to
a secondary role and emphasised the need for a project manager to cater for the
client’s interests. As a reaction to these changes, the occupational strategies of
both the RICS and RIBA have staked a claim to provide project management
services.

5. Conclusions

It is clear that PMAs see themselves as emergent professions and that there is an
appetite to be recognised as formal professions. The world of project management
is dominated by PMI which claims some 450,000 members and credential holders
(Feb 2010) and with its intention ‘to further the professionalization of project
management’ is clearly seeking formal recognition as a profession. This contrasts
markedly with the International Project Management Association (IPMA) which has

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as members the national project management associations of some 50 countries.

While IPMA seeks professional recognition, it is less obvious in its approach since it
is constrained by its deliberately federalist structure which slows its decision
processes to that of its least developed member association. Continental countries
have a very different view of ‘profession’ so there exists a range of perceptions on
the value of pursuing such an end. However, within IPMA, its largest member
association, the UK’s Association for Project Management (APM), is currently
awaiting a decision for the Privy Council on its application for a Royal Charter, the
recognition of profession in UK.
PMI appears to be pursuing a strategy of professionalization through occupational
closure. It has undergone rapid expansion of its membership based largely on its
effective marketing of the PMP qualification. The likely effectiveness of this
approach seems questionable since there is no indication that the general public
see a need to employ credentialed project managers. PMI have also undertaken
research on what is needed to advance their professional claims. The conclusions
of this work enumerated the steps needed for any profession to gain recognition
and it is clear that most PMAs, including PMI and IPMA, have completed many of
the steps, particularly with the activities around credentials, education and
definition of bodies of knowledge. There remain some areas for concern, notably
control of the use of the name and the development of an effective code of ethics
which can be enforced. It appears therefore that efforts to achieve occupational
closure are unlikely to be effective, at least in the short to medium term.
There remain two aspects of profession on which agreement has yet to be reached;
at least so far as project management is concerned. First, professional status is at
least in part dependent on the general public accepting that there is some benefit
to be gained from the activities of ‘professional’ practitioners. However, there is a
substantial literature delineating the ‘failure’ of project management to deliver
successful projects. Further, there is considerable discussion on what constitutes
success in project management. Both aspects have implications for the status of
project management since if the general public and other key stakeholders perceive
project management as of limited effectiveness, they are unlikely to support the
necessary occupational closure.

The second area of debate lies in just who wants to be considered a ‘professional’.
It is by no means certain that all project managers, or even a substantial proportion
of them actually want to regarded as professionals. There remains the view that
individual project managers may benefit from increased security of employment as
licensed practitioners and might attain greater personal authority within the
workplace, all of which might bring increased status and reward. Set against this,
some will fear the loss of individual control for the most successful practitioners and
the need to accept professional liability. As we have seen there is debate of what
constitutes success so the issue of liability raises an unwelcome spectre for many
practitioners.
The professionalization efforts of IPMA are probably best exemplified by work
currently undertaken by its British member, APM. These efforts centre on their
Charter project. While some see this activity as more a commercial reaction to
demands of the rapidly expanding Corporate membership than necessarily a
declaration of professional intent, it has clear endorsement by its members.
Others, especially those not of an Anglo Saxon upbringing, may conclude that such
steps are characteristically British and that the achievement of professional status
has little equivalence elsewhere.

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There can be little doubt that many aspects of PMA operation are of a commercial
nature. Published accounts show that certification activities make up a significant
proportion of PMI’s annual income and there is no reason to suppose that IPMA is
any different. Supporting certification is the concept of continuous professional
development. While it is acknowledged that professionals need to maintain their
level of knowledge and keep current with developments, some see the need to
formally document such activities as more to do with commercial operation than
true need to update professional skills. Such updating can also be seen as an
attempt to exert occupational closure, particularly where the range of suppliers of
such ‘new knowledge’ are prescribed by the professional body.
One of the major activities for any PMA is the building of influence with
Governments, corporations and with the general public. Some observers note that
there are serious issues with senior executives’ perception of project management
which they perceive to be unrelated to the organisational goals. This view may be
related to the nature of the PMBOK which is seen by many analysts as addressing
only the operational aspects of projects. Both the British and Japanese Bodies of
Knowledge take a more discursive view of the nature of projects and so address a
context that is more easily related to business objectives. Although they are now
broadening their credentialing scheme, PMI have marketed their main credential
most effectively, it is hard to see how this single level can support a view of
professional development. Although these aspects do not of themselves prevent
trust and influence from emerging, they do nothing to actively build the level of
influence likely to be needed to persuade stakeholders that the discipline has
indeed the depth and attributes of a profession.
We conclude that while project management has many attributes of a profession, it
cannot yet be considered a candidate for recognition. While PMAs are striving to
achieve occupational closure, there are many aspects that prevent such closure.
Control over the title ‘Project Manager’ has not been achieved and the certification
programme is still entirely voluntary so even the most basic control has not been
established. Despite this, PMAs have achieved much over the past decade.
Certification schemes exist and are extremely popular among practitioners, even if
they are not yet regarded as indispensable. PMAs are beginning to accredit
University courses and are forging relationships with academic and research
communities which may lead to broadening of the body of knowledge. The main
obstacle, however, lies with the members of the project management associations.
So far, there is insufficient evidence that to show that they really appreciate the
advantages and responsibilities that professional status bring.

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AA098

Enterprise Resource Planning Systems for Project-Based Firms:

Costs, Benefits & Implementation Challenges

Miroslaw J. Skibniewski
(A. James Clark Chair Professor)

Yajun Zeng
(Ph.D. Candidate ,Project Management, Program
Department of Civil & Environmental Engineering
University of Maryland, College Park, USA)

Abstract
Enterprise Resource Planning (ERP) systems are configurable enterprise-wide
information system services that integrate information and information-based
processes within and across functional areas in an organization. They have been
widely adopted in many organizations and accepted as a de facto industry standard
for the replacement of legacy systems. This paper analyzes and presents the costs
and benefits of ERP systems for project-based industries, which have lagged behind
other major industries in adopting ERP systems due to their project-centric nature
and the high stakes involved in ERP implementation. The challenges during the
process of ERP implementations are also identified as part of the effort to
understand the implied costs of an ERP system. The evidence of the costs and
benefits is drawn from previous studies and the analysis of the prevailing working
practices in project-based firms. The classification of the costs and benefits
constitutes a cost and benefit taxonomy which can be used to enable executives in
project-based firms to make informed decisions on their ERP system investments.

Keywords
Enterprise Resource Planning (ERP) System, Cost-Benefit Analysis, Project-Based
Organization, System Implementation

1. Introduction

Since the 1990s, Enterprise Resource Planning (ERP) systems have become a de
facto industry standard for replacing legacy systems and been perceived as the
prevailing form of business computing for many large organizations in the private
and public sectors (Gable, 1998; Parr & Shanks, 2000). ERP systems are designed
and configured to achieve seamless integration of all of the information flowing
through an organization, by integrating information-based processes within and
across different functional departments, such as accounting, finance, human
resources, manufacturing and distribution. They also connect the organization to
its customers and suppliers and thus enable the integration beyond organizational
boundaries. They are multifunctional in scope, integrated in nature, and modular in
structure (Mabert, Soni, & Venkataramanan, 2001). According to an AMR research,
the total application revenue in the global ERP market was $28.8 billion in 2006; it
was projected to increase to $47.7 billion in 2011 (Jacobson, Shepherd, D’Aquila, &
Carter, 2007). Indeed, the ERP market is the largest segment of the applications
budget (34%) in business organizations, with ERP penetration at 67% among large
companies (Sirkisoon & Shepherd, 2002). ERP is also increasingly deployed in
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small- and medium-sized companies, as ERP vendors turn their sights to smaller
enterprises with tailored products for new business growth.

The adoption of ERP systems in project-centric industries appears to have been

lagged behind other major industry sectors, such as manufacturing and financial
services. Project-based organizing is found in a wide variety of industries, including
architectural & engineering design, construction, aerospace & defense, professional
services, entertainment, technology, etc. In project-based firms, the project, which
is defined as “a temporary endeavor undertaken to create a unique product,
service, or result” (PMI, 2008), is the primary unit for production organization,
innovation, and competition. Hence project-based firms are distinguished from
those organizations that are primarily based on and profitable from continual
business operations, in which ERP system implementations have been more often
documented. A study on ERP adoption by European midsize companies indicates
that the project industry had the lowest ERP penetration rate at the time the survey
was conducted (van Everdingen, van Hillegersberg, & Waarts, 2000). Another
study states that few organizations in the construction industry, which is
ubiquitously composed of project-based firms, have implemented ERP systems,
despite wide awareness of such systems (Ahmed, Ahmad, Azhar, & Mallikarjuna,
2003). There is also room for growth in the ERP market in aerospace and defense
companies, most of which are project-oriented (Botta-Genoulaz & Millet, 2006).

ERP systems, if successfully implemented, can bring substantial benefits to

organizations. By providing real-time, organization-wide information access, ERP
systems have the potential to improve organizational effectiveness and
productivity, enable the management to make informed decisions, and enhance the
competitiveness of the organization in the market. However, their implementations
are often characterized with large capital outlay, long implementation period, high
complexity, and proneness to failure. It has been reported that the average
duration for ERP implementations was about 18 months and that the average cost
was about US$ 6.2 million (Panorama Consulting Group, 2010). This might keep
many project-based companies from adopting ERP systems due to their limited
financial, technical and human resources, and aversion to risks. Without essential
awareness of the benefits ERP systems can bring and the stakes involved, project-
based firms either rush to implement an unsuitable ERP system that may result in
cost and schedule overrun, abandonment of the project, or unrealized returns; or
simply refuse to take advantage of ERP systems and risk losing business
competitiveness and growth opportunity in the marketplace. Therefore, it is very
important to fully understand and thoroughly evaluate the costs and the benefits of
ERP systems before making the decision on whether to adopt an ERP system in the
organization or which ERP packages and modules to be selected and implemented.

2. Research Design

The main objective of this study is to identify and analyze the full spectrum of costs
and benefits of ERP systems in the context of project-based firms. Enumeration of
costs and benefits is the prerequisite of sound cost-benefit analysis and many other
kinds of economic or financial techniques in capital project decision making, such as
Net Present Value (NPV) and Internal Rate of Return (IRR) methods. The
indentified costs and benefits of ERP systems constitute a comprehensive
taxonomy. In addition, the challenges to ERP implementation in project-based
firms are discussed, considering the specific conditions of such firms.
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The costs and benefits of ERP systems are identified and analyzed from the point of
view of senior management and/or owners of project-based firms, who make the
decisions on ERP investment. The evidence of ERP costs and benefits are primarily
drawn from extant literature. There have been a large number of journal articles
and conference papers related to ERP systems and their evaluation, selection,
implementation, and use in recent years. However, most of them are placed in
generic organizational environments and few addresses ERP systems in project-
based firms specifically. In this study, the costs and benefits of generic ERP
systems are considered to apply to project-based firms. Further, those costs,
benefits, and issues more likely to be associated with project-based firms are
elaborated in conjunction with the analysis on the prevailing working practices and
characteristics of project-based firms. There are also numerous publications
generated by ERP vendors and consulting firms, in the forms of white papers, case
studies, presentations, and so on. These publications, although suffering from the
lack of independence and objectivity, have been cited by researchers now and
again and could provide useful references as well.

3. Benefits of ERP Systems

The benefits of ERP systems have been constantly advocated and reported by ERP
vendors and consultants. These benefits are generally supported by the post-
implementation performance of ERP systems and improvement of productivity and
profitability of the hosting organizations. Davenport, Harris, & Cantrell (2002)
propose a pyramid illustrating how the value from enterprise solutions, among
which ERP system is the backbone, is achieved (see Fig. 1). The benefits of ERP
systems are realized, in other words, the value is achieved, by the following three
means: integration of information system, data, and processes among different
organizational units and with existing organizational environment or external

Fig. 1: Value of enterprise solutions (Davenport, et al., 2002)

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stakeholders; optimization of business processes using best practices or fitting the

business needs; and transforming data into context-rich information and knowledge
that support business analysis and decision making (termed “informate”)
(Davenport, et al., 2002). There have also been attempts to systematically identify
the benefits of ERP systems. Fig. 1 lists 10 types of benefits as components of
value. Shang & Seddon (2000) presents a comprehensive framework for classifying
ERP benefits; according to the framework, 5 dimensions of benefits are proposed,
which could be further classified into 25 sub-dimensions. This framework provides
a basis for analyzing ERP benefits in project-based organizations.

Cost and cycle time reduction are the basic operational benefits of ERP systems.
There are numerous studies stating that investment in information systems to
automate transactions can speed up processes, substitute labor, and increase
operation volume (Brynjolfsson & Hitt, 1996; Shang & Seddon, 2000). Unlike
retailing companies that sell a wide variety of identical products to a large base of
customers, project-based firms operate by providing specific services, products or
other results, which are highly customized and seldom duplicable; and their
customer base is usually much smaller. Thus it is very important for them to
ensure the quality of every product or service and retain customers or clients. The
capabilities of ERP systems to reduce duplicates and errors and enhance
responsiveness to customer needs can help project-based firms to improve
productivity and quality and retain customers. Besides, risk reduction is regarded
as an additional benefit of ERP (SAP, 2010). By providing real-time information as
well as analysis and reporting tools, ERP systems can help management to better
forecast or detect risky issues and take preventive or corrective measures in time.

Since project-based firms are composed of dispersedly located teams undertaking

different projects that have loose coupling with each other, these project teams
normally enjoy considerable autonomy (Bresnen, Goussevskaia, & Swan, 2004).
This makes lots of firms essentially decentralized. Indeed, conflict and abrasion
frequently occurs among different projects in a firm (Kodama, 2007). By storing
and managing all the data in a centralized database and providing built-in data
analysis capabilities, ERP systems can enable both project managers and senior
executives to better manage the resources (asset, inventory, workforce, etc) within
a project team and also among different teams, measure and control individual and
team performance, and make better informed decisions. In addition, project cost
management applications that are widely in use today may be confined to a single
project or a number of them; they cannot provide a holistic view of corporate
financial status or effectively manage all the financial assets and liabilities of the
firm. In contrast, ERP systems have been proven able to effectively and efficiently
manage the finance of a whole organization (Davenport, et al., 2002). Therefore
improved financial management is considered as a separate benefit.

Rackoff, Wiseman, and Ullrich (1985) proposed five strategic thrust areas where a
company could make a major offensive or defensive move: differentiation, cost
leadership, innovation, growth, and alliance. As stated by Shang & Seddon (2000),
ERP could assist in achieving these strategic benefits, although the benefit of
product differentiation is questionable as the products of project-based firms are
always differentiated. Powered by the up-to-date information of ERP systems and
the increased processing capacity, it is possible for project-based firms to respond
quickly and competitively to new opportunities leading to business growth, such as
bidding on new projects. Such growth can lead to worldwide expansion, as ERP
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systems are capable of supporting global operations. The need to achieve project
objectives that fully address key stakeholder expectations throughout the project
lifecycle has been stressed in previous studies (Bourne & Walker, 2005; Cleland &
Ireland, 2006). Thus the benefit of ERP to build external linkage is of significance
to project-based firms. Besides, ERP systems can help align business strategies
with daily operations of an organization (SAP, 2010). Another benefit is that, as
Internet becomes indispensable and ubiquitous today, web-enabled ERP systems
can integrate or support e-Business.

ERP systems, with integrated and standardized application architecture, provide an

infrastructure that could support 1) business flexibility for current or future
changes, 2) reduced IT costs and marginal cost of business units’ IT, with the high
integration cost eliminated and the need to purchase third-party software
diminished, and 3) increased capability for quick and economic implementation of
new applications (Shang & Seddon, 2000). With organizational structure adjusted
and business process reengineered according to the best practices embodied in the
system, ERP implementation can support organizational changes and enhance
corporate governance. Other organizational benefits include facilitating learning,
empowering employees, building a culture with common visions, and improve
employee morale and retention (SAP, 2010; Shang & Seddon, 2000).

Based on the above analysis and adapted from the framework developed by Shang
& Seddon (2000), Table 1 lists 28 types of ERP benefits categorized into 5
dimensions. While the majority of these benefits are put forward from generic
organizational environment, they could be evaluated in the context of project-based
firms. Davenport, Harris, & Cantrell (2002) argue that increased revenue is a
component of ERP value. Integrated business processes can enable an organization
to provide new offerings of products or services or exploit new channels, thus
generate extra revenue. Nonetheless, this is covered by other benefit sub-
dimensions such as business growth and productivity improvement. There are also
studies that support positive connections between ERP and improved liquidity
(Matolcsy, Booth, & Wieder, 2005), and ERP and increased profitability (Hendricks,
Singhal, & Stratman, 2007; Matolcsy, et al., 2005). Similarly, they are considered
as the results of benefit realization rather than benefit themselves in this study.
Dimensions Sub dimensions
1. Operational 1.1 Cost reduction
 Labor cost (headcount) reduction
 Inventory cost reduction
 Administrative cost reduction (e.g. printing, office supplies, travel)
1.2 Cycle time reduction: faster project delivery
 Cycle time reduction in customer support activities
 Cycle time reduction in employee support activities
 Cycle time reduction in supplier support activities
 Cycle time reduction in support activities with other external
partners or stakeholders
1.3 Productivity improvement
 Increase in products produced, or service provided, per employee
or labor cost
1.4 Quality improvement
 Error reduction
 Duplicates reduction
 Accuracy or reliability rate improvement
1.5 Improve customer services and retention
 Ease of customer data access and inquiries
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 Improved ability to retain customers

1.6 Reduce business risks
 Better risk forecasting
 Improved response and responsiveness to risk occurrence
2. Managerial 2.1 Better resource management
 Better asset management
 Better inventory management
 Better production management for optimized supply chain and
production schedules
 Better workforce management
 Few physical resources/better logistics
2.2 Improved planning and decision making
 Improved strategic planning and decisions
 Improved operational decisions
 Improved customer decisions
2.3 Better performance measurement and control
2.4 Improved financial management
 Improved financial budgeting and analysis
 Better management of financial assets and liabilities
 Centralized and real-time financial reporting and performance
evaluation
3. Strategic 3.1 Improve alignment of strategies and operations
3.2 Support business growth
3.3 Support business alliance
 Consolidate newly acquired companies into standard business
practice
 Collaborate with external parties for joint projects
3.4 Build business innovations
 Enable new market strategy
 Build new process chain
 Create new business
3.5 Build cost leadership
 Achieve economies of scale
3.6 Generate or enhance product differentiation
3.7 Build external linkage (with customers, suppliers, contractors,
collaborators, etc.)
3.8 Enable worldwide expansion and operations
3.9 Enable e-Business
4. IT Infrastru- 4.1 Increased business flexibility
cture 4.2 Reduce or optimize IT spending
4.3 Increase IT infrastructure capability and adaptability for
implementation of new applications
5. 5.1 Support organizational changes and corporate governance
Organizational 5.2 Facilitate business learning and broaden employees’ skills
5.3 Empowerment
5.4 Changed culture with common visions
5.5 Changed employee behavior with shifted focus
5.6 Better employee morale and satisfaction with improved
retention of top performers
Table 1: Taxonomy of ERP Benefits, adapted from Shang & Seddon (2000)

4. Cost of ERP Systems

Compared with typical software licensing and installation, ERP systems are much
more expensive to acquire and implement. The total cost of ERP project varies in a
wide range, from hundreds of thousands of US dollars for a single ERP module
implementation in small firms, to the magnitude of over one billion dollars for
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complicated global ERP roll-outs in multinational corporations. ERP cost depends on

many variables, such as the ambition of the project, the number of the organization
units the system will serve, the number of modules installed, the amount of
integration required with legacy systems, the readiness and extent of organizational
changes in terms of structure and business processes, the scope of software
modification and customization, etc. This makes it hard to precisely estimate or
predict the expenses.

In general, the cost of ERP system implementation can be classified into two
categories: direct costs and indirect costs. Direct costs, or tangible costs, are those
costs explicitly related to ERP implementation that the hosting organization has to
pay and thus can be reflected on the corporate income statements. Normally,
direct costs include expenses incurred due to software purchase or licensing,
hardware acquisition and installment, procurement of external professional
services, addition of headcount, staff training, and so forth. According to a survey
on ERP implementations in Swedish manufacturing companies, the average shares
of the proposed six components of ERP direct costs are: software, 24.2%;
hardware, 18.5%; consulting, 30.1%; training, 13.8%; implementation team,
12.0%; and others, 1.4%, respectively (Olhager & Selldin, 2003). Software and
hardware costs basically depend on the selection of ERP packages and hardware
upgrades, existing IT infrastructure, and IT planning. The use of ERP consultants,
usually external consultants from professional service firms, is common in ERP
projects and regarded as a success factor (Somers & Nelson, 2001). Because lots
of project-based firms have fragmented processes and differentiated business
needs, customization, system integration and data conversion are critical, thus
using consultants’ expertise could play a major role in diminishing ERP risks. As a
result, choosing the right consultants with sufficient application knowledge and
industry experience and making full use of consulting services have the potential to
control or lower the direct cost of ERP implementation in project-based firms.

Indirect costs, or intangible costs, are elusive to define, identify and control. They
are “off-the-books” expenses, damages, or losses generated mainly by human or
organizational factors (Irani & Love, 2001). Organizations implementing an ERP
system often have to be prepared to see the organization reengineered, its staff
disrupted, and its productivity drop before the payoff is realized (Umble & Umble,
2002). Indeed, ERP system implementation may turn out to be a distraction or
disruption, at least temporarily, to the firm’s ongoing projects and operations. This
include shifted management focus, using employees’ time for extensive training,
lowered employee morale and work efficiency because of possible job role redesign
or headcount reduction, conflicts and frictions between organizational units, and so
on. Indirect costs in generic IT investment (Irani, Ezingeard, & Grieve, 1998; Love
& Irani, 2001; Marsh & Flanagan, 2000) are also likely to occur in the ERP projects.

Table 2 provides a taxonomy of ERP costs, categorized into the two dimensions. It
is noteworthy that while ERP maintenance cost in the post-implementation stages
must be taken into account, the cost of optional ERP system upgrades and
introduction of additional functionalities are considered separate projects. Besides,
although indirect costs are difficult to fully enumerate and quantify, total cost of
ownership (TCO) has been advocated by some as an effective method to measure
the cost of ERP systems and support ERP strategies and decisions (Aberdeen
Group, 2006; West & Daigle, 2004), which may partially incorporate the estimation
of indirect costs.

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Dimensions Sub dimensions

1. Direct costs 1.1 Software purchase or licensing
 ERP solutions
 Database management system
 System software
 Security software
 Additional applications
1.2 Hardware acquisition or upgrade
 Servers & database machines
 PCs, workstations, printers, scanners, and other computer
peripherals.
 Network equipment
 Installation and configuration of hardware
 Other facilities
1.3 Professional services by external consultants
 Customization
 Data conversion
 Installation and configuration
 System integration
 Testing and troubleshooting
 Other technical support
1.4 Internal staffing
 Additional permanent hiring
 Additional temporary hiring
 Staff turnover
1.5 Instruction and training
1.6 Maintenance and mandatory upgrades
1.7 Administrative and miscellaneous costs
 Overheads
 Travel
 Contingency
2. Indirect Costs 2.1 Disruption to ongoing projects (strains on resources, additional
change orders, delays, etc.)
2.2 Temporary loss in productivity
2.3 Temporary decline in quality of work
2.4 Business process reengineering
2.5 Organizational restructuring
2.6 Shift of management focus and dedication
2.7 Use of management and employee time
2.8 Job role redesign & reassignment
2.9 Decline in employee engagement and morale
2.10 Culture changes
2.11 Conflicts and frictions among organizational units
2.12 Transition from legacy system to the ERP system
2.13 Impact on relationship with key stakeholders
Table 2: Taxonomy of ERP Costs, adapted from Love & Irani (2001) and Iba (2006)

5. Implementation Challenges

ERP implementations are exposed to various risks. Previous studies have described
a number of risk factors in generic ERP implementations, such as low top
management support and involvement, inadequate business process reengineering,
inadequate legacy system management, and ineffective project management
(Aloini, Dulmin, & Mininno, 2007; Umble, Haft, & Umble, 2003). In project-based
firms, the mission-oriented nature and resource- and time- constrained ways of
working, combined with the loose coupling between different projects, usually

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create highly distributed and fragmented working practices (Bresnen, et al., 2004;
Lindkvist, 2004). As such, implementing ERP systems in such organizations must
overcome certain additional challenges.

Project success is critically dependent on the collaboration and support of its

stakeholders. Examples of such key stakeholders include major clients of the
company, as well as suppliers, regulators, and collaborating partners. Regarding
ERP projects, stakeholders not only include those participants in the
implementation processes, but also need to involve the stakeholders in the projects
carried out by the organization during and after the implementation. It is these
projects that bring profits to the firm and make the ERP adoption worthwhile.
Ineffective stakeholder relationship management leads to frictions, scope creep,
inappropriate measurement, specification changes, delays, and other issues
(Hartman & Ashrafi, 2002). Therefore, it is very important to maintain good
relationships with stakeholders and involve key stakeholders, including but not
limited to internal users, into the implementation process.

As a result of the physical dispersion of project teams, ERP systems in project-

based firms have to be implemented in a multi-site manner, which brings special
concerns (Umble, et al., 2003). The conflicts between centralized control and
individual site autonomy, and between corporate standardization and localized
optimization, increase the complexity of ERP implementation and entail difficult
trade-offs. Local legal, regulatory, and environmental issues are also need to be
seriously addressed and reflected in the reengineered business processes.
Moreover, since project teams are of high mobility, moving from one site to another
with reshuffled staff as a project is completed, the temporariness of project team
composition and site location makes it difficult to carry out ERP implementation and
manage the IT asset effectively. In addition, project-based firms often need third-
party specialized applications with functionalities that current ERP systems are not
able to provide. For example, engineering design and construction firms heavily
rely upon Computer-Aided Design (CAD) or Building Information Modeling (BIM)
solutions to undertake their projects. As a result, achieving integration and
interoperability to some extent between ERP system and non-ERP applications is a
big challenge during the implementation process.

6. Conclusion

The study reported herein aims to systematically identify and analyze the benefits
and costs of ERP systems in the context of project-based firms. A number of
challenges to ERP implementations are discussed that specifically pertain to such an
organizational environment. The listed costs and benefits constitute a
comprehensive taxonomy addressing the impacts of ERP systems on project-based
firms, which can be used to conduct cost-benefit analysis and support decision
making on ERP system evaluation and investment. While almost all direct costs can
be quantified in financial terms, most of the benefits and indirect costs are difficult
to measure with the use of quantitative methods, which makes a comparative
evaluation of costs and benefits for implementation decision making inconclusive.
Development of effective techniques to estimate quantitative values of intangible
costs and benefits and a sound cost-benefit analysis methods for ERP systems in
project-based firms is the subject of research being pursued by the e-Construction
Group, a research unit at the University of Maryland.

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Brynjolfsson, E., & Hitt, L. M. (1996). Paradox lost? Firm-level Evidence on the
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Cleland, D., & Ireland, L. (2006). Project Management: Strategic Design and
Implementation (5th ed.). New York, NY: McGraw-Hill.
Davenport, T. H., Harris, J. G., & Cantrell, S. (2002) The Return of Enterprise
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Hartman, F., & Ashrafi, R. (2002). Project Management in the Information Systems
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Hendricks, K. B., Singhal, V. R., & Stratman, J. K. (2007). The Impact of Enterprise
Systems on Corporate Performance: A study of ERP, SCM, and CRM System
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Iba, B. (2006). Towards A Whole Lifecycle Cost Model for ERP Projects. Cranfield
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Jacobson, S., Shepherd, J., D’Aquila, M., & Carter, K. (2007). The ERP Market
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Hackensack, NJ: World Scientific Publishing.
Lindkvist, L. (2004). Governing Project-Based Firms: Promoting Market-like
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Mabert, V. A., Soni, A., & Venkataramanan, M. A. (2001). Enterprise Resource

Planning: Common Myths Versus Evolving Reality. Business Horizons 44(3), 69-
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Matolcsy, Z. P., Booth, P., & Wieder, B. (2005). Economic Benefits of Enterprise
Resource Planning Systems: Some Empirical Evidence. Accounting and Finance,
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Olhager, J., & Selldin, E. (2003). Enterprise Resource Planning Survey of Swedish
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AA116
Standardizing of Standards in IPM of Construction

Jüri Sutt
(Professor, Tallinn University of Technology, Estonia)

Tauno Hang
(Doctorant, M. Eng., Tallinn University of Technology, Estonia)

Urmas Aaskivi
(M.eng.,Tallinnn University of Technology, Estonia)

Abstract
PM including construction nowadays crosses the borders of countries which points
to the necessity to overcome borders of technical languages and culture. For it is
necessary to unify the quantitive measurement properties of building materials.
In the presented model standardized standards of building materials are connected
with known technology of matrix coding, scanning and decoding .
The model can be used in PM technology starting from the design of building in
form of specification of project elements, their functions and resources bearing
these functions and on the other side starting from the manufacture of producing
specified resources and passing through the supply chain to the building site,
including automated control by owner’s supervisor. Implementing the BIM makes it
possible to automatize over twenty datamation procedures in the project life-cycle.

Keywords
construction, economics, building material, standard of standard

1. Trends on construction market

Construction is handicraft in its essence. The auxiliary works, such as transport and
lifting and simple construction works not requiring high qualification of the
employee such as soil works, concrete cast etc. are mechanised This means that
out of the resources of power type (machines and people), the effectiveness of
which management determines the intensiveness of construction work is labour.
The conflict has been written into the construction management system in long-
term plan. The pressure of the owner on the constructor to shorten the duration of
the projects, incl duration of construction on the site, takes unavoidably to the
uneven loading of resources of power type involving the non-productive expenses.

Economic-theoretically the problem cannot be described with the mainstream

microeconomics methods where the production intensiveness is measured with the
quantity of production in time unit which in other words is intensity of production.
The latter is described by figure 1 where the entrepreneur chooses the production
volume on the basis of equality of marginal cost Cm and marginal revenue Rm . One
construction project is often continues more than one year, the other only some
months. How to make the production intensiveness comparable in construction
(project management), if one company simultaneously constructs the buildings of
very different size and complicacy?

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C/R C/R
10%
R∑
Cm
Ca 6%
Rp Rf
4%
Cc

Pmax Ra
Rm T3s Topt T2s T1s 1,1T1s

Fig. 1. Mainsteam
microeconomics. Fig.2. Microeconomics in project
Enterpriser (monopol) management.
maximizing his profit General contactor (monopson)
maximizing his profit

The solution lies in measuring the production intensiveness through relative

construction duration, i.e. in other words with relation of actual construction
durations to the standard duration of the same buildings.
The latter means the duration achieved in working in one shift with maximum close
intensiveness (with the number of workers) which can be calculated in preparing
the construction organisation project during the construction preparation period.
Such a mean was used by Harris F. & McCaffer R.,1997 standardizing bids of tender
prices. The interesting interval of change in duration of construction has been
limited, on one side, by work in three shifts T3s (theoretically minimum duration)
and on the other side, 1.5 times longer than in case of working in one shift
(1,5T1s). The contractor without the pressure of the client would prefer to work in
one shift, i.e. during daytime and guaranteeing 50% time reserve for oneself The
figure 2 indicates the change in cost price (Cc) of construction in changing the
average construction duration within the interval of1,1T1s up to T3s.

2. Saving on cost without lose in quality

But it is necessary to keep in mind that costs on wages are only half of costs on
building materials. As materials are storing resources there is no problem with
uneven need of them on time scale. It seems that the problem to save on materials
is very simple – only buy them cheaper. But as we can conclude on many dispute
cases it can be achieved paying charge to quality.
The reason of loss in quality on international market of building materials is
foremost in regional nature of construction market and the lack of internationally
harmonised classifiers and standards for describing the properties of the materials.
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And if these are, they themselves are non-standardised. The numerous

classifications of the construction materials and their properties are in use.

Classifications base on generic properties of materials forgetting that main aspect in

classification must be for what the materials are needed.

3. Classification of building materials

The structure of classifier of construction materials from the viewpoint of

construction management should be determined based on the two different
objectives. First, this should create the basis for grouping the construction
materials for logical choice in multiple variant specification of constructive element
or functional part of the building in the design phase. This means that materials
should be grouped according to their purpose of use in the construction body and
the subgroups according to the most important physical properties. The same
structure should be also the basis for creating the catalogues of for estimators, the
sales lists in web portals, in bookkeeping, websites of producers etc. The source of
the special-purpose classification and coding of materials should be the structure of
standard of constructional usage purposes of the material which would guarantee
the compatibility of the databases both in the phases of designing the buildings, in
construction and use of building.
The main function, i.e. usage purpose of the material proceeds from the logics of
the system of the building as the system to be designed in the constructive element
or in the functional part of the building. Considering that the database of
construction materials (e.g. pricelist) includes thousands positions, it is reasonable
to indicate the additional division of the usage purpose to the subclasses in the
universal classifier by using the main property for that purpose in which
constructive element of the building this material can be used. And the form of
material if the use of material depends on it.
The number of groups of the database of construction materials based on the above
is approximately 30, the properties of which could be described by at least half a
smaller number of standards.
In classifying the database of materials the additional levels can be used for
facilitating the search of materials from the database. In order to ensure the
practical overview it seems that in most part three and/or four-level classifier is
sufficient and adequate for structuring the material database.
Another two facets should be used for identifying the material:
- The first of them determines the combination of value (intervals of values) of
physical properties described in the standard of material, thus the quality of
material at its final level,
- The other one determines the trademark of producer or seller, thus also the
price of material. The differentiation of these two steps could be necessary
also due to the fact that the supplier is not known during the designing or
due to that in case of public procurement the referring to the specific supplier
is even forbidden.

4. Standartization of standards on properties of building materials

Traditionally the quantitative indicators of properties in the documents of the

standard of construction material group have been submitted in different chapters
of the standard intertwined with explanatory text, usually also in the tables of
different shape which do not enable to realise one of the most important principle
of automation of data processing: single insertion of the data to the information
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carrier and its repeated (multiple) use in different tasks, by different users and at
different moments of time. The standard of material group requires
standardisation which in its turn opens up the possibility for standardized
description of the properties specified in the project and in the certificates. As
in case of classification of the materials, then also in case of classification of the
standards of materials the same logics is appropriate, which in other words means
that one standard is compliant to each material classification group.
In order to guarantee the requirements (strength, reliability, fire and noise
resistance) the designers should consider the physical, i.e. inner (natural)
properties of materials. These properties are measurable. These properties which
should be considered in designing and constructing the building, are different for
each material group bearing the above function. As to each material group with the
same usage function the lists, descriptions and measuring scales of these properties
should be prepared and agreed between all parties participating in the construction.
Such description of properties can be formally provided as matrix. The properties of
all materials belonging to the group can be fully described with the number
combination of all lines and columns of the table (matrix).
When presuming that the material groups the different standards complying with
which are ‹ 50 and each material has been described by ‹10 quality indicator, the
characterization of each one ‹10 value, value interval or name of subclass is
defined, it is concluded that the full classifier of the construction materials would
involve approximately 105 names. The operating with such classifier on paper would
be probably troublesome, if not impossible.

As an example the standard of qualities of one material group bricks has been
provided in Table 1.

Measure
Property ment Value
unit
1 2 3 4 5 6 7 8 9
gas-
silicat granit limes
1 Raw material clay concr
e e tone
ete
Cover Cover
Open
Open ed ed
intern
Working outer exter intern
2 al
conditions surfa nal al
surfa
ce surfa surfa
ce
ce ce
Compressive Mpa/ 3,0- 5,0- 12,5- 20-
3 3,0
strength cm2 5,0 12,5 20 30
Resistance to
4 Cycles - 15 25 30
cold
Special
thermal 0,10- 0.12- 0,20- 0,25- 0,50- 0,70- 0,80-
5 w/mK
conductivity 0,12 0,20 0.25 0,50 0,70 0,80 0,90
λ
Fire
6
resistance min 15 30 45 60 90 120 180 240
1000 1200 1400 1600 1800 2000
600- 600- ≥220
8 Density kg/m3 - - - - - -
800 1000 0
1200 1400 1600 1800 2000 2200
Accor
ding
natur
9 Paint to
al
order

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Table 1 . Sample of the standardized standard of the properties of material group

The primary usage purpose of material:
1.1. Load bearing
2.3. Surrounding the room

The required qualities of the material to be specified can be described on the same
scheme in the course of designing, but also in the certificate of the material issued
in the producer’s company or the values of the actual properties of the product
provided in the conformity certificate in the same formal language. For that purpose
the relevant nests should be indicated in the same table (toned columns in the
table). The silicate used in the under-plaster wall(covered surface) as the periphery
of the interior room with even surface, regular shape and natural colour with the
compressive strength 3 Mpa/cm2, fire resistance 60 minutes, fire sensitivity class D
and for which no thermal and density requirements are set. The specification is
achievable for the master file as a result of 8 clicks.
The usage purpose of the material (material group) which one material could have
several in the construction has been written in the header of the standard for the
clarity purposes. The material’s (material group) own generic (Eckholm, 1995), i.e.
construction physical properties, i.e. type of raw material is written to the nests of
the table.
The digital coding form of such information should be chosen for the IT solutions.
The high number of the properties describing one product gives the undisputable
advantages for using matrix code IT tecnology. Such standardization enables to
create full databases of materials in the companies and the systems of information
offer, search and exchange in the company and between the companies with the
help of universal and standard software systems (e.g. Microsoft Access and
ORACLE). The standardised software for printing and scanning of such matrix
codes is existent in the series PDF417.
The precondition of submitting and the reading of both the material group standard
as well as the certificate of the specific material is already achieved required
development phase of both matrix-codes software and hardware.
The formal description of the quality of construction materials enables to
overcome the language barriers but also the cultural barriers established
as the good practice of the construction field of different countries which
are unavoidable in verbal description of the qualities.

The following list of tasks of data processing of construction materials in the life
cycle of the building is surely not exhaustive, but describes adequately the total
number of tasks and their diversity, where the material saving of human labour is
achievable with the application of above described standardisation process:
- Specification of required qualities of material by the designer
(deciding),
- Preparation of the summary specification of the construction materials by the
designer (preparation of the lists of materials and works, the bill of
quantities),
- Preparation of the cost budget by the designer,
- Raw material dosing tasks at the producer’s,
- Production process monitoring at the producer’s,
- Marking of finished production at the producer’s (labelling the
product),
- Automation and mechanisation of the warehouse search-removing operations
of the producer or wholesaler,
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- Registration of the certificate or quality conformation document at the

producer’s,
- Registration of the delivery note and invoice at the producer’s,
- Preparation of the purchase order at the constructor’s,
- Forwarding of the purchase order to the sellers in the web environment at
the constructor’s,
- Receipt of the goods at the constructor’s and conformity control,
- Conformity control of the material by the owner’s construction supervision,
- Preparation of the project of repair works for the user of the building with the
new already described information processing iterations,
- Describing of the construction materials in the portals and websites of the
retail and wholesalers of the sales agents,
- Publication of the pricelists of the construction materials on paper and in
web,
- Construction technology projects and charts of standard technologies.
The operations where the qualities should be inserted by the persons onto the
information carrier provided in bold (only by clicking on the columns of the
matrix). The remaining operations can be performed with the help of the scanner
and printer. Mobile phones can be used for generation and reading for matrix
codes.

5. References

Harris F.& McCaffer R.Modern Construction Management, BSP Professional Books,

Oxford. 1997. p.267
Sutt J. Simulating of Economic Mechanism of Construction Enterprise. (1985).
Congress on Project Management, Ljubljana, Slovenia, 436- 443.
Sutt, J. Microeconomics of Project Management. (1988) Proc.14th World Congress
on Project Management, Ljubljana, Slovenia, 436- 443.
Sutt J. About economics, management and construction.(2003).Proc of Joint Int
Symposium of CIB Working Commissions, W55, W65, W107: Knowledge
Construction. National University of Singapore, Vol.1. 685- 694.
Sutt J, I.Lill. (2009).Project Management for Construction Clients in the Estonian
Market. Handbook. Tallinn. TTU.104 pp.

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W00

PhD Research Methodology

Monty Sutrisna
(School of the Built Environment,University of Salford,UK.)

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TAY-1

Grasping the opportunities of the PM decade

Tom Taylor
(Buro Four,dashdot & APM ,UK)

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AA073
Resource-Constrained Scheduling of Construction Projects and
Simulation of the Entropy Impact on the Duration and the Cost of a
Project

Evangelos S. Tezias
(Civil Engineer, MSc., Thessaloniki, Greece)

Symeon Christodoulou, Ph.D

(Associate Professor, University of Cyprus, Department of Civil and Environmental
Engineering, Nicosia, Cyprus)

Konstantinos A. Galaras
(Civil Engineer, MSc., Thessaloniki, Greece)

Abstract
The paper reports on research about the relationship between project resources
and the entropy generated during construction, as well as on the development of a
related mathematical model. The aim is to optimize the allocation of resources in a
resource-constrained project by use of an entropy metric, to study the delays which
occur during the project and to relate them with the resources and the entropy in
the project. Entropy is hereby defined as the disorder brought about by the
fluctuation of resources in the project, and a higher entropy value relates to a
higher risk in terms of schedule completion. The case study shows that a significant
reduction of time (up to 25.7%) can be achieved by utilizing the entropy method
for allocating resources. Furthermore, should a resource-constraint be imposed
then the entropy approach results in a schedule that shows a 6.25% improvement
in duration (and 8% in profit) over the solution obtained by classical scheduling
methods. The reported work builds on previous and ongoing research at the
University of Cyprus and the Democritus University of Thrace.

Keywords
Resource-Constrained Scheduling, Entropy, Time-Cost Trade-off

1. Introduction

A common problem occurring in construction scheduling is that required resources

are often not available when needed or in the number/amount needed. So the
planner has to reschedule activities considering such resource constraints. The aim
is to avoid delays that arise from this kind of problems and to reduce the duration
and cost of the projects while not compromising the quality of works. Nevertheless,
a study based on statistics of several projects, shows that a compression of the
project duration for up to 50% can cause a decrease of productivity up to 17%
(Hanna et al. (2008)). In the past, there have been some studies for resource
constrained scheduling, mostly by use of serial and parallel scheduling (Colak et al.
(2006); Hegazy, T. (1999); Senouci and Eldin (2004); Sakellaropoulos and
Chassiakos (2004)).

A new approach has recently been developed based on minimizing the total entropy
of the project schedule (Christodoulou et al. (2008a,b); Christodoulou et al.
(2009a,b,c)). Entropy (Hx) is a metric generally defined as the product of the

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probability distribution (px) of a variable times the natural logarithm of the inverse
of that probability distribution (Eq.1).

Hi, j = pj ln (1/pj) (1)

The progress of an activity and the project's subsequently is being defined by the
productivity of the resources and the number of assigned resources (nr) (Griffis and
Farr (2006); Christodoulou and Ellinas (2008a)). Therefore, the entropy (H) of an
activity (i) produced by a resource (j) is being defined by means of the ratio of
required (R) over assigned resources (R') per activity (Christodoulou and Ellinas
(2008a)) (Eq.2). Entropy is defined as the disorder brought about by the fluctuation
of resources in the project, and a higher entropy value relates to a higher risk in
terms of schedule completion.

HACT = R/R΄ln(1/ (R/R΄)) (2)

In order to minimize the total project entropy

min HT = min{ Σ Σ (Ri/ R΄i) [ln (1/(Ri/ R΄i))]} (3a)

subject to
Σ(R΄i)<=nr (3b)

Ri and R΄i, integer (3c)

R΄i>= 0 (3d)

2. Solution method

As the number of assigned resources increases, so does the activity duration

decrease (usually and up to a certain limit such relationship is linear). However
there is a limit. After this, any increase of the number of assigned resources causes
a decrease in productivity and problems in managing the activity (work space
limitations and time-space conflicts), which means an increase in the cost and the
duration of the project with resulting proportional delays.
The aim is to optimize the utilization of resources in order to balance between low
entropy (thus disorder), low cost and low duration of the project without
compromising quality standards.

A closer look at Eq.2, reveals that the entropy can have negative values when the
assigned resources (R') are fewer than the required resources (R). Similarly, as the
assigned resources increase, the entropy gets positive values (assigned resources
are more). A maximum is reached when the assigned resources are equal to 2.718
of required resources. Then the entropy tends to reach a zero value. With that in
mind, and assuming the linear relationship between resource usage and
productivity, the limit of “2.718” can be defined as the limit of disorder that the
system can handle and only solutions within this limit are deemed to be acceptable
(Eq.4).

R'≤2.718R (4)

In order to find the best solutions that combine low entropy and low cost and
duration of the project, a simulation-based approach can be utilized so as to help us

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arrive at all possible combinations of resource allocations under the imposed

resource-availability constraints.

3. Case Study

A real-life 3-floor building was scheduled by use of commercially-available software

(Primavera Project Planner). The project contains 83 activities (excavations,
concrete works, iron works and everything else needed to complete the project)
and finishes 218 days after it starts. A Pert diagram is produced (Fig. 1), where
critical activities are being identified. The total cost of the project (unconstrained) is
722,490 euros. After taxes and profit considerations the cost is calculated at
1,166,698 euros. The profit of the constructor is 18% of the total cost before taxes.
In this case study resources refer only to labor resources, and the original resource
demands are as shown in Table 1.

Fig 1: Pert Diagram of the project

Solution of the entropy optimization equations was obtained by means of

simulation. This was achieved by use of commercially available software
(Decissioneering’s Crystal Ball) which enables the automatic generation of random
events from defined probability distribution functions and the simulatineous
evaluation of their effects based on mathematical formulations. In this way, all
possible combinations for resource allocation were investigated in order to find
solutions that combine low entropy, low cost and low duration of the project, under
the resource constraint. Results for the best solutions of project entropy, project
duration and project cost are shown in Tables 2-3. The best solution obtained in the
simulation is one that completes the project in 167 days (51 days earlier) with a
related project entropy of negative value (thus easily managed).

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Activity Required Laborers Act. Req. Lab. Act. Req. Lab. Act. Req. Lab.
10 3 220 2 430 2 640 2
20 0 230 4 440 4 650 1
30 2 240 4 450 4 660 4
40 4 250 2 460 2 680 1
50 1 260 4 470 4 690 1
60 2 270 4 480 4 700 1
70 1 280 2 490 2 710 4
80 2 290 4 500 2 720 4
90 2 300 4 510 1 730 4
100 2 310 2 520 2 740 4
110 4 320 4 530 4 750 4
120 4 330 4 540 2 760 4
130 2 340 2 550 2 770 4
140 4 350 4 560 2 780 4
150 4 360 4 570 2 790 4
160 2 370 4 580 2 800 4
170 4 380 4 590 2 810 4
180 4 390 4 600 2 820 2
190 2 400 2 610 1 830 0
200 4 410 2 620 2
210 4 420 4 630 4

Table 1: Resources required per activity (quantity of labor, initial plan)

Aver. Daily Entropy Max Res. per day Total Delay Total Entropy Total rev. Cost Total Rev. Duration
-0,11 19 -14 -23,25 721090 204
-0,09 21 -16 -17,15 720890 202
-0,08 17 -14 -16,25 721090 204
-0,07 18 -15 -13,88 720990 203
-0,07 21 -16 -13,04 720890 202
Table 2: Best solutions for lowest project duration
Aver. Daily Entropy Max Res. per day Total Delay Total Entropy Total rev. Cost Total Rev. Duration
-0,01 21 -51 -2,12 717390 167
0,03 19 -48 5,41 717690 170
-0,03 19 -42 -5,16 718290 176
0,02 19 -41 2,62 718390 177
0,01 19 -40 1,89 718490 178
0,03 18 -40 6,03 718490 178
0,05 14 -40 9,06 718490 178

Table 3: Best solutions for lowest project entropy

All above solutions are obtained within the “2.718” criterion. If the laborers for each
activity are assigned exactly at 2.718 times of required laborers then we would
have the solution shown in Table 4, which gives the lowest duration of the project,
from all the solutions found, but with big enough entropy. Of course, it is up to the
project manager to take the risk and decide which solution is the best and most
manageable.

Aver. Daily Entropy Max Res. per day Total Delay Total Entropy Total rev. Cost Total Rev. Duration
0,21 20 -80 29,16 714489,93 138
Table 4: Best solution for the lowest project duration.

In this project the laborers work only 8 hours every day, without shifting work. The
factor that changes from solution to solution is the number of laborers that are
being assigned to every activity. So the time compression doesn't affect the
laborers productivity. Nevertheless, if a decrease of productivity is set up to 17%
(Hanna et al. (2008)), as the worse situation that could be found because of the
compression of time, then the duration of the solution found in Table 4, is 162 days
(very close to 167 days previously obtained with negative project entropy) which
means a 25.7% reduction in the project duration. The extra profit of the
constructor is calculated at 39,000 euros (extra 5% of the initial cost). The project
can be completed faster and the resources can be used in other projects.

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A resource constraint can also be set. In this case study, the maximum total
resource number required by the initial planning is 8 laborers for several days. A
constraint was set for a maximum of 6 laborers that can be assigned per day (Fig
2).

Fig 2: Total use of laborers per day of work in the project and constraint of six
laborers per day availability

The project was then rescheduled by leveling the network with the use of Primavera
v.3 (Primavera Systems, 2001), without splitting activities. The new duration of the
project is 240 days with a delay of 22 days from the initial planning.

By the same method as before, all possible combinations are examined (by use of
simulation) in order to find solutions that combine low entropy, low cost and low
duration of the project, but this time under the resource constraint.

Because of the enormous number of possible combinations needed, the simulation

is limited by assigning a varying number of resources only to the activities which
are in progress during the days when required resources are more than six laborers
per day. The number of assigned laborers is from 1 up to the number of required
laborers for these activities (Table 1 shows these activities shaded). The other
activities are assigned with the required number of laborers as used in the initial
planning. The results of the simulation for the entropy, cost, duration and delay of
the project under the resource constraints are shown in Figures 3-6. The 5 best
solutions that could be found, combining lowest duration, lowest entropy and lowest
cost appear in Table 5. The best utilization of the available resources is the one that
completes the project in 225 days, 15 days earlier than the new schedule from
Primavera and only 7 days delay from the initial unconstrained plan, which means a
6.25% improvement in duration and 8% in profit over the solution obtained by
classical scheduling methods. So the comparison of the results of the two methods
(classical and entropy based) show that better resource allocation can be found in
order to get lower duration and cost of the project, while taking into account the
risk factor (represented by the entropy level).

Finally, Figure 7 shows the relationship between total delay and total entropy of the
project. As the delay increases, so much does the entropy decrease, which means
that it is more difficult to manage the project while trying to reduce the delay and
the duration of the project.

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Fig 3: Resource-constrained total Fig 4: Resource-constrained total cost

project entropy

Fig 5: Resource-constrained Fig 6: Resource-constrained total delay

total project duration

AvgDaily
Resource
Aver. Daily Entropy Utilization Max Res. per day Total Delay Total Entropy Total rev. Cost Total Rev. Duration 110 120 170 230 290 350 470 490 500 630 660
-0,05 65,33% 6 7 -11 723189,93 225 3 2 2 2 2 2 2 2 1 3 3
-0,07 63,94% 6 8 -17 723289,93 226 4 2 2 1 2 2 2 1 1 2 4
-0,07 64,38% 6 8 -16 723289,93 226 4 2 1 2 2 2 2 2 1 2 3
-0,08 64,97% 6 8 -17 723289,93 226 4 2 2 2 2 1 1 2 2 3 3
-0,09 63,72% 6 8 -19 723289,93 226 3 3 1 2 2 2 1 2 1 2 3
Table 5: Best solutions for the lowest project duration.

Fig 7: Relationship between delay and entropy of the project

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4. Conclusions

Entropy is a new factor in decision making that can show the level of risk of a
project to manage. The higher the entropy is (disorder), so more difficult is to
manage the project.
The paper shows that there is a strong relationship between entropy and project
duration and cost. With the shown entropy-based methodology, solutions that
combine low entropy, low cost and low duration of construction can be found. In
this specific case study a significant reduction of time has been achieved (up to
25.7%) and after imposing the resource constrain then the entropy approach
results in a schedule that shows a 6.25% improvement in duration (and up to 8%
in profit) over the solution obtained by classical scheduling methods, with entropy
in low level, which means low level of risk to complete the project as planned.

Furthermore, a project manager is given the decision-making tools to use in

deciding which solution is best attained and the risk associated with each solution,
based on his/her knowledge of the level of difficulty in managing the project, the
resulting entropy and its impact on the duration and the cost of a project.

5. References

Christodoulou, S. and Ellinas, G. (2008), “Minimizing Disorder in resource- Constrained

Scheduling”, in: Pantouvakis, J.P. (ed.), Proceedings of the PM04 Conference, Chios,
Greece, May 29-31, 2008.
Christodoulou, S. (2008), “A bid-unbalancing method for lowering a contractor's financial
risk”, Construction Management and Economics, 26(12), 1291-1302.
Christodoulou, S., Ellinas, G. and Aslani, P. (2009), “Disorder considerations in resource-
constrained scheduling”, Construction Management and Economics, 27(3), 229-240.
Christodoulou, S., Ellinas, G. and Aslani, P. (2009), “Entropy-based scheduling of resource-
constrained construction projects”, Automation in Construction, 18(7), 919-928.
Christodoulou, S., Ellinas, G. and Michaelidou-Kamenou, A. (2009), “The Minimum Moment
Method for resource leveling using entropy maximization”, Journal of Construction
Engineering and Management, in press <doi: dx.doi.org/10.1061/(ASCE)CO.1943-
7862.0000149.
Colak, S., Agarwal, A. and Erenguc, S. (2006), “Resource constrained project scheduling: A
hybrid neural approach”, International Series in Operations Research and Management
Science, Kluwer Academic, 92, 297-320.
Griffis, F. H. and Farr, J. V. (2001), Construction Planning for Engineers, Mc Graw Hill, New
York.
Hanna, A S., Chang, C.,. Sullivan, K. T. and Lackney, J. A. (2008), “Impact of Shift Work on
Labor Productivity for Labor Intensive Contractor”, Journal of Construction Engineering
and Management, ASCE, 134(3), 197-204.
Hegazy, T. (1999), “Optimization of resource allocation and leveling using genetic
algorithms”, Journal of Construction Engineering and Management, 125(3), 167-175.
Primavera Systems (2001), Primavera Project Planner electronic manual, Primavera
Systems.
Sakellaropoulos, S. and Chassiakos, A. P. (2004), “Project time- cost analysis under
generalized precedence relations”, Advances in Engineering Software, 35(10-11), 715–
724.
Senouci, A. B. and Eldin, N. (2004), “Use of genetic algorithms in resource scheduling of
construction projects”, Journal of Construction Engineering and Management, ASCE,
130(6), 869-877.

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AA056

Skills and Competences of Project Managers

Panagiotis G. Trivellas, Ph.D.

(Associate Professor, Department of Accountancy, School of Business and
Economics, TEI of Larissa, Larissa, Greece)

Christos G. Drimoussis, MBA

(Chemical Engineer N.T.U.A., Certified in Project Management - IPMA Level D,
Management Organisation Unit of Development Programmes S.A.,
Athens, Greece)

Abstract
This study aims to diagnose the skills and competences profile of Project Managers
in a holistic approach by utilizing a comprehensive framework (ICB–IPMA
Competence Baseline Version 3.0, 2006). The Competing Values Model is adopted
to operationalize Project Managers’ effectiveness, as it shares wider acceptance
among researchers. It is constituted from two dimensions (flexibility versus control
and internal focus versus external focus), defining four quadrants that address
distinct demands in the organizational arena. The Competing Values Model has also
been utilised as a device for mapping organizations’ leadership profiles and
conducting comparative analysis. Furthermore, it may serve as a diagnostic tool,
providing guidance to Project Managers in the identification of the key skills and
competences that they will need to improve in order to foster individual
effectiveness. This preliminary field research (the research is still on-going) is
based on a structured questionnaire pilot-tested and adapted to fit to Greek reality.

Keywords
Project Manager, Soft Skills, Managerial Competences, Performance, Field Research

1. Introduction

Nowadays, the implementation of principles and techniques of Project Management

has expanded rapidly in many enterprises worldwide. Project Management can be
defined as the implementation of knowledge, skills, methods and modern
techniques or tools to activities in projects in order to satisfy the needs or to
overcome the expectations of all stakeholders. The modern Project Manager
understands that effective teams have interdependent members. The productivity
and efficiency of an entire team is determined by the coordinated, interactive
efforts of all its members. As a matter of fact, Project Managers must deal with
team members or external negotiators with different perceptions and values,
especially critical to the management of conflicts and crisis. On this account, apart
from technical competences, behavioural competences are also a vital prerequisite
in order the project to be completed successfully. A Project Manager needs strong
communicative and interpersonal skills. To some extent, the deficiency of some
behavioural competences is considered to be a significant obstacle for project
success.

2. Review of the Literature

2.1. Behavioural Competences

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There can be classified 15 behavioural competence elements, which are relevant to

the profession of Project Management and in the context of the project (ICB–IPMA
Competence Baseline Version 3.0, 2006). Their importance can and will differ
depending on the situation. These behavioural competence elements are listed and
analysed below in Table 1:
No. Behavioural
Competence Elements 12.1.1 Brief Definition
1 Leadership Leadership refers to patterns of behaviour as well as
attitudes about communication, conflict resolution,
criticism, teamwork, decision making and delegation.
2 Engagement & Engagement with and motivation of the project
motivation manager and the team members reflect the personal
buy-in from all individuals associated with the project.
3 Self-control Self-control or self-management mirrors a systematic
and disciplined approach to deal with daily routine as
well as stressful situations.
4 Assertiveness Assertiveness involves the ability to state views
persuasively and authoritatively taking into
consideration their impact on decision making and
consequently on project success.
5 Relaxation Relaxation is focused on the relief of tension in
difficult situations in order to re-energise individuals.
6 Openness Openness refers to the cultivation of an open climate
among individual so as to benefit from their input,
suggestions, worries and concerns, avoiding
discrimination on the grounds of age, gender, sexual
orientation, religion, cultural differences or disability.
7 Creativity Creativity describes the ability to think and act in
original and imaginative ways in order to achieve
project success.
8 Results orientation Results orientation outlines project team’s attention
on key objectives to obtain the optimum outcome for
all the parties involved.
9 Efficiency Efficiency refers to the efficient allocation and
exploitation of all resources available to the project.
10 Consultation Consultation is focused on rational decision making
and solid arguments presentation in order to find
solutions.
11 Negotiation Negotiations establish the means by which the
involved parties can resolve disagreements towards a
mutually satisfactory solution.
12 Conflict and crisis Conflict and crisis in a project can be described as a
time of acute difficulty, demanding risk analysis and
scenario planning in order to handle these obstacles.
13 Reliability Reliability reflects the ability to meet time and quality
project’s specifications.
14 Values appreciation Values appreciation is based on mutual respect and
on the receptiveness of others’ opinions, value
judgements and ethical standards.
15 Ethics Ethics embraces the morally accepted conduct or
behaviour representing personal and professional
freedoms as well as boundaries.

Table 1: The behavioural competence elements based on ICB –

IPMA Competence Baseline Version 3.0
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2.2. Competing Values Framework (CVF)

The Competing Values Framework (CVF) evolved from the work of Quinn and
Rohrbaugh (1983) as they attempted to circumscribe a generally agreed upon
theoretical framework of the concept of organizational effectiveness. This
framework was chosen for this study, because it was experimentally derived and
found to have a high degree of face and empirical validity in comparison with other
instruments commonly used in organizational sciences (Cameron and Ettington,
1988; Cameron and Quinn, 1999). The CVF has also been utilised as a device for
mapping organizations’ leadership profiles and conducting comparative analysis
(Trivellas and Dargenidou, 2009). It is constituted from two dimensions (flexibility
versus control, and internal focus versus external focus), defining four quadrants,
those are Open Systems, Rational Goal, Internal Processes and Human Relations.
The diagonal dimensions also produce conflicting or competing values. For example,
the values in the Open Systems Model (upper right quadrant) emphasize an
external focus concerned with flexibility and growth, while the values in the Internal
Processes Model (lower left quadrant) accentuate an internal focus with control and
stability.

Cameron and Quinn (1999) developed an instrument to assess individual

effectiveness based on the four CVF models and consolidated a list of successful
leadership skills into a set of 12 competency categories. In particular, Open
Systems Model involves managing the future, promoting continuous improvement,
and fostering innovation, Rational Goal Model is comprised of managing
competitiveness, energizing employees and focusing on customer service, Internal
Processes Model is consisted of managing acculturation, controlling the system
and coordination, and Human Relations Model considers the management of
interpersonal relationships, teamwork and personal development.

3. Methodology

3.1. Research design

The field research was conducted using a structured questionnaire, which was
developed based on the work of ICB–IPMA Competence Baseline Version 3.0,
describing behavioural competences, and Quinn and Cameron’s instrument of
individual effectiveness. The research instrument was tested twice before it was
released. Firstly, it was examined by ten project managers from consulting,
construction and engineering companies. Secondly, it was provided to academics
for in depth discussions. This process was fruitful, since they commented, rejected
and finally confirmed the cognitive relevance of the items comprised the final
competency questionnaire. It must be stressed that this paper provides the results
of an ongoing field survey, thus the findings of this research must be treated with
caution because of the small sample size and its limited representativeness of the
respective population. The data analysis was based on an aggregation of
individuals' scores for each of the high and low performers subgroups (N=30)
according to each one of the four individual effectiveness dimensions, which were
compared using t-tests. Almost 23% of the respondents are female. The majority of
the respondents (47%) has a working experience of more than 15 years. Finally,
30% of the respondents have been Certified Project Managers.

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3.2. Internal reliability of subscales

Inter-item analysis was used to verify the behavioural competences sub-scales for
internal consistency or reliability. Specifically, Cronbach’s coefficient alpha was
calculated for each sub-scale, as recommended by Flynn et al. (1990), ranging
approximately between 0.65 and 0.85, apart from Rational Goal Model dimension of
effectiveness (0.65). Thus, most sub-scales exhibited over 0.70 reliability levels,
which as suggested by Nunnally (1967) is the minimum level for acceptance. Given
that the Rational Goal Model effectiveness sub-scale comprises only three items and
considering its cognitive complexity and ambiguity, we favoured to sustain the
theoretical designed component structure, notwithstanding this comparatively low
alpha coefficient.

Items Cronbach’s alpha

Behavioural Competences
Leadership 13 .81
Engagement & Motivation 7 .79
Self-control 8 .78
Assertiveness 8 .81
Relaxation 7 .75
Openness 10 .89
Creativity 5 .85
Results Orientation 4 .70
Efficiency 8 .83
Consultation 8 .71
Negotiation 6 .70
Conflict & Crisis 6 .79
Reliability 4 .70
Values appreciation 10 .87
Ethics 5 .70

Individual Effectiveness
Human Relations Model 3 .80
Open Systems Model 3 .75
Rational Goal Model 3 .65
Internal Processes Model 3 .70

Table 2: Results of internal reliability analysis for all subscales

4. Findings and Analysis

4.1 T-test analysis

The objective of our study was to identify the profiles of high and low levels of
Project Managers’ effectiveness. T-test analysis was used to assess the statistical
significance of the differences between groups of Project Managers according their
level of individual effectiveness across the four dimensions prescribed by the CVF.
Results of paired t-test analysis comparing the means of each competence across
the four effectiveness dimensions are exhibited in Tables 3, 4, 5 & 6, indicating
each group’s high and low value, difference and level of significance of each paired
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comparison. Graphical visualisations of the findings across the emerging dimensions

are presented in the Appendix (Figures 1, 2, 3 & 4).

4.2 PMs’ behavioural competences profiles according to individual

effectiveness

Regarding individual effectiveness focused on Human Relations Model, the three

types of competences which were proven to be the most dominant ones
distinguishing high and low PMs’ performers are Efficiency, Values appreciation, and
Engagement & Motivation. However, six out of the fifteen behavioural competences
have no significant difference between high and low levels of Human Relations
Model effectiveness (Table 3).

12.1.2 Behavioural Competences Low High Dif. Sig.(t-test)

1 Leadership 5,30 6,07 0,77 p<0,01

5,17 6,13 0,96 p<0,01
2 Engagement & Motivation
3 Self-control 5,25 5,65 0,40 n.s.

4 Assertiveness 5,31 5,88 0,57 n.s.

5 Relaxation 5,10 5,54 0,44 n.s.

6 Openness 5,41 6,23 0,82 p<0,01

7 Creativity 5,07 5,78 0,71 n.s.

8 Results Orientation 5,09 5,74 0,65 n.s.

9 Efficiency 4,96 5,97 1,01 p<0,01

10 Consultation 5,14 5,83 0,69 p<0,05

11 Negotiation 4,97 5,88 0,91 p<0,01

12 Conflict & Crisis 5,36 5,92 0,56 n.s.

13 Reliability 5,61 6,18 0,57 p<0,05
14 Values appreciation 5,10 6,11 1,01 p<0,01
15 Ethics 5,52 6,45 0,93 p<0,01

Table 3: Results of paired t-test analysis among competences of high and low level
of Human Relations Model effectiveness

Considering individual effectiveness focused on Open Systems Model criteria, the

top three types of competences differentiating high and low PMs’ performers are
Creativity, Efficiency, and Engagement & Motivation. However, two behavioural
competences (Self-control and Reliability) found to have no significant difference
between high and low levels of this effectiveness dimension (Table 4).

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12.1.2.1 Behavioural Competences Low High Dif. Sig.(t-test)

1 Leadership 5,32 6,08 0,76 p<0,01

2 Engagement & Motivation 5,14 6,16 1,02 p<0,01

3 Self-control 5,16 5,73 0,58 n.s.

4 Assertiveness 5,22 5,96 0,74 p<0,05

5 Relaxation 4,99 5,70 0,71 p<0,05

6 Openness 5,39 6,26 0,87 p<0,01

7 Creativity 4,82 6,00 1,18 p<0,01

8 Results Orientation 5,02 5,71 0,69 p<0,05

9 Efficiency 4,91 6,00 1,09 p<0,05

10 Consultation 5,22 5,80 0,58 p<0,05

11 Negotiation 4,92 5,89 0,96 p<0,01

12 Conflict & Crisis 5,30 6,00 0,70 p<0,05

13 Reliability 5,68 6,11 0,43 n.s.

14 Values appreciation 5,13 6,12 1,00 p<0,01

15 Ethics 5,57 6,42 0,85 p<0,05

Table 4: Results of paired t-test analysis among competences of high and low level
of Open Systems Model effectiveness

Referring to individual effectiveness focused on Rational Goal Model, the three

types of competences which were proven to be the most dominant ones
distinguishing high and low PMs’ performers are Creativity, Efficiency, and
Engagement & Motivation, sharing the same pattern with the Open Systems Model.
Reliability was the only behavioural competency with no significant difference
(Table 5).

12.1.3 Behavioural Competences Low High Dif. Sig.(t-test)

1 Leadership 5,23 6,09 0,85 p<0,01
2 Engagement & Motivation 5,01 6,19 1,17 p<0,01
3 Self-control 5,08 5,76 0,69 p<0,05
4 Assertiveness 5,13 5,98 0,85 p<0,05
5 Relaxation 4,87 5,74 0,87 p<0,01
6 Openness 5,31 6,25 0,94 p<0,01
7 Creativity 4,72 5,98 1,26 p<0,01
8 Results Orientation 4,94 5,72 0,78 p<0,05
9 Efficiency 4,80 6,00 1,20 p<0,01
10 Consultation 5,13 5,83 0,70 p<0,05
11 Negotiation 4,82 5,90 1,08 p<0,01
12 Conflict & Crisis 5,23 6,00 0,77 p<0,05
13 Reliability 5,68 6,08 0,40 n.s.
14 Values appreciation 5,03 6,12 1,09 p<0,01
15 Ethics 5,53 6,38 0,85 p<0,01

Table 5: Results of paired t-test analysis among competences of high and low level
of Rational Goal Model effectiveness

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Examining individual effectiveness focused on Internal Processes Model criteria, the

top three types of competences differentiating high and low PMs’ performers are
Creativity, Efficiency, and Engagement & Motivation, sharing the same pattern with
the previous two models. However, two behavioural competences (Self-control and
Reliability) found to have no significant difference between high and low
effectiveness, results identical to those of the Open Systems Model (Table 6).

12.1.4 Behavioural Competences Low High Dif. Sig.(t-test)

1 Leadership 5,32 6,10 0,78 p<0,01
2 Engagement & Motivation 5,15 6,18 1,03 p<0,01
3 Self-control 5,17 5,76 0,59 n.s.
4 Assertiveness 5,23 5,98 0,76 p<0,05
5 Relaxation 4,99 5,72 0,73 p<0,05
6 Openness 5,40 6,28 0,88 p<0,01
7 Creativity 4,83 6,02 1,20 p<0,01
8 Results Orientation 5,03 5,73 0,71 p<0,05
9 Efficiency 4,92 6,02 1,11 p<0,01
10 Consultation 5,22 5,82 0,60 p<0,05
11 Negotiation 4,93 5,91 0,98 p<0,01
12 Conflict & Crisis 5,31 6,02 0,72 p<0,05
13 Reliability 5,69 6,13 0,45 n.s.
14 Values appreciation 5,13 6,14 1,01 p<0,01
15 Ethics 5,58 6,44 0,87 p<0,05

Table 6: Results of paired t-test analysis among competences of high and low level
of Internal Processes Model effectiveness

5. Conclusions

This study aims to invistigate the skills and competences profile of Project
Managers based on the ICB–IPMA Competence framework. The CVF is adopted to
operationalize Project Managers’ effectiveness, as it shares wider acceptance
among researchers. This preliminary field research (the research is still on-going) is
based on a structured questionnaire pilot-tested and adapted to fit to Greek reality.
The first findings reveal that project managers characterized by high levels of
competencies exhibit also enhanced individual effectiveness across all four
dimensions (Open Systems, Rational Goal, Internal Processes and Human
Relations). In particular, Creativity, Efficiency, Engagement & Motivation as
well as Values appreciation are the four competency categories that best
highlight the gap differentiating high and low PMs’ performers.
Furthermore, CVF may serve as a diagnostic tool, providing guidance to Project
Managers in the identification and cultivation of the key skills and competences that
they will need to improve in order to foster individual effectiveness.

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6. Appendix

Figure 1: Competences’ profiles of high

and low performing PMs regarding
Human Relations Model effectiveness

Figure 2: Competences’ profiles of high

and low performing PMs regarding Open
Systems Model effectiveness

Figure 3: Competences’ profiles of high

and low performing PMs regarding
Rational Goal Model effectiveness

Figure 4: Competences’ profiles of high

and low performing PMs regarding
Internal Processes Model effectiveness

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7. References

Cameron, K.S. and Ettington, D.R. (1988), “The Conceptual Foundations of

Organizational Culture.” in Smart, J.C., ed. Higher Education: Handbook of
Theory and Research. New York: Agathon.
Cameron, K.S. and Quinn, R.E. (1999), “Diagnosing and Changing Organizational
Culture: Based on the Competing Values Framework”, Reading, MA: Addison-
Wesley.
Flynn, B.B., Sakakibara, S., Schroeder, R., Bates, K., & Flynn, J., (1990), ”Empirical
Research Methods in Operations Management. Journal of Operations
Management”, 9(2), pp. 250 - 284.
ICB - IPMA Competence Baseline Version 3.0 (2006), International Project
Management Association (IPMA).
Nunnally, J.C. (1967), “Psychometric Theory”, 1st Edition. New York: McGraw-Hill.
Quinn, R.E. and Rohrbaugh, J. (1983), “A Spatial Model of Effectiveness Criteria:
Towards a Competing Values Approach to Organizational Analysis”,
Management Science 29 (3): pp. 363 - 377.
Trivellas P. and Dargenidou, D. (2009), “Leadership and Service Quality in Higher
Education: The case of the Technological Educational Institute of Larissa”,
International Journal of Quality and Service Sciences, Vol. 1, Issue 3, pp. 294 -
310.

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AA018

Development and Prototype Application of an Oil Spill Risk Analysis

in a Coastal Zone

Tsimopoulou, V.
(MSc student, Hydraulic Engineering, Delft University of Technology, Delft, The
Netherlands)

Abstract
This paper introduces the development of a methodology for performance of oil spill
risk analysis in coastal zones through a prototype application. The main objective of
the research effort is to develop the basis for a tool that can assess risks due to the
occurrence of an oil spill event aiming at assisting to the risk response process. The
methodology concerns the processes of probability and consequence assessment.
The two processes are accomplished qualitatively with a risk prioritization based on
Analytic Hierarchy Process. Being a decision-making technique, Analytic Hierarchy
Process can only be used after some appropriate modifications, which transform it
into a tool for prioritizing risks with respect to their probability and consequence in
different oil spill scenarios. This is an approach that attempts to rationalise the risk
analysis stages and to indicate the uncertainties imposed to the problem, hence
creating a basis for optimization of the risk analysis results.

Keywords
Risk Analysis, Oil Spill, Analytic Hierarchy Process.

1. Introduction

The aim of oil spill risk management is to minimize the probability of occurrence of
an oil spill event, and to optimize the risk response process once the event occurs.
The present research effort is orientated to the risk response process, and
particularly to the assessment of risks that occur after an oil spill event. The main
objective is the elaboration of the basic processes of a risk analysis, which are the
identification of risks, the assessment of their probability and consequence, and
finally the actual risk assessment.

The analysis is performed in an imaginary coastal area that is assumed to

concentrate some particular features which allow demonstration of a broad number
of oil spill cases. Those features are the existence of wetlands, fisheries, a port with
both commercial and passengers’ services, an oil refinery and coastal tourism.

2. Risk identification

The risk identification has been based on literature (Kassomenos, 2004) and the
author’s experiential review, and facilitated by the event-tree technique. Accounting
for the assumed characteristics of the application area, a number of mainly short-
term risks were initially recorded, which were then presented with an event-tree.
The event-tree as well as the identified risks are presented in figure 1.

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R15 R17 R18

R2
R17 R18

R11 R18 R1 : Degradation of coastal ecosystem

R3
R1 R12 R18
R2 : Ban on swimming
R3 : Ban on fishing activities
R6 R17 R18 R4 : Port entrance blockage
R15 R17 R18 R5 : Accident (fire/explosion)
R7 R6 : Degradation of coastal aesthetics
R17 R18
R7 : Loss of balance in coastal ecosystem
R15 R17 R18 R8 : Delays in port operations
R2
R17 R18 R9 : Life losses/injuries
R10: Material damages on ships
R11 R18
Oil Spill R3 R11: Financial losses in fishing and aquaculture industry
R12 R18 R12: Limitations in the supply of goods to the market
R12 R18 R13: Decrease of Port Organization's reliability
R14: Decrease of involved shipping companies' reliability
R4 R8 R13 R16 R18
R15: Decrease of tourists' inflow
R15 R17 R18 R16: Financial losses in shipping companies
R9 R14 R16 R18
R17: Financial losses in tourism industry
R5 R18: Political costs
R10 R14 R16 R18

R14 R16 R18

Fig 1: Event-tree and identified risks

The identified risks can be classified in three categories based on their position in
the event-tree. They can be direct, indirect or dual. Direct are the risks that
constitute direct consequence of the oil spill event. Indirect are the risks that
constitute direct consequence of another risk that has occurred, and not of the oil
spill event. Dual are the risks that can be consequence of both the initial event and
some other risk. In the above event-tree, direct are the risks R1, R4 and R5, dual
are the risks R2, R3 and R14, while all the remaining risks are indirect. In the
upcoming analysis it is assumed that dual risks belong in either set of direct and
indirect risks.

3. Probability assessment

The probability of occurrence of the identified risks is assessed qualitatively. The

choice for a qualitative analysis is based on the fact that records referring to follow-
up risks of an oil spill are usually not available, and therefore a quantitative
analysis is not possible. The product of this process is qualitative probability values
for every identified risk. For this reason a probability scale is required. The scale
proposed contains five probability classes, characterized with the integer numbers
from 1 to 5. Each class corresponds to a probability range. The description of the
five classes together with an indicative correspondence to real probabilities is
presented below (table 1).

Class Probability range Description

1 0-20% very low
2 20-40% low
3 40-60% medium
4 60-80% high
5 80-100% very high

Table 1: Probability scale

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The probability of each risk varies under different conditions. For direct risks it
depends on the characteristics and the nature of the oil spill event. For indirect
risks, it depends on the probability of all preceding direct and indirect risks. The
main parameters that affect the probability of direct risks are the following: P1) Oil
spill size, P2) Weather conditions, P3) Oil spill location. These parameters can take
various values. The combination of certain values of the three parameters
determines certain oil spill scenarios for which the risk probability can be assessed.
The parameter values that are used in this research are presented in table 2. The
oil spill size is determined in accordance to the oil spill categories of the
International Tanker Owners Pollution Federation. The weather conditions are
determined by a combination of wind speed and direction. The wind direction is
characterized favorable or unfavorable, depending on if it results in decrease or
increase of a certain risk probability respectively.

P1 P2 P3
S1: < 7t W1: 0-15km/h, favorable L1: close to wetlands
S2: 7-700t W2: 15-35km/h, favorable L2: close to tourism installations
S3: > 700t W3: 35-55km/h, favorable L3: close to fisheries
W4: > 55km/h, favorable L4: port entrance
W5: 0-15km/h, unfavorable L5: commercial quay in the port
W6: 15-35km/h, unfavorable L6: passengers' quay in the port
W7: 35-55km/h, unfavorable
W8: > 55km/h, unfavorable

Table 2: Parameter values

Based on the above parameter values, 168 different oil spill scenarios can be
derived. The probability assessment of the direct risks in each of these scenarios
can be facilitated if an intermediate process of risk prioritization with respect to
probability is accomplished. In order to minimize the uncertainties imposed by a
qualitative prioritization, it is necessary that the process is rationalized in a way
that all steps requiring subjective decisions by the analysts are distinguishable. This
can be achieved with application of a modified form of Analytic Hierarchy Process.
The modifications made concern mainly its transformation from a decision-making
technique to a tool for risk prioritization.

Analytic Hierarchy Process offers a rational framework for structuring and solving
multi-criteria decision-making problems. The outcome of its application is a
prioritization of the alternative choices by means of numerical factors. Its
framework can be easily adapted for use in a risk prioritization process when
different hazard scenarios are examined. In this case the process has to be
repeated as many times as the number of direct risks. The outcome is a
prioritization of the scenarios with respect to the magnitude of probability that they
impose to the examined risk. Two additional simple steps can lead to the final
objective, which is the prioritization of all direct risks with respect to their
probability in every single scenario. A presentation of the risk prioritization steps as
applied to the example area is given below. Only steps that are not identical to the
corresponding steps of Analytic Hierarchy Process are described. These are steps 1,
2, 3 and 7. Steps 4, 5 and 6 are in absolute correspondence with Analytic Hierarchy
Process, and therefore their presentation is neglected. The application refers to risk
R3.

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1. Definition of the problem parameters and their possible values. They have been
already introduced. There are three parameters namely P1, P2 and P3 with
values S1-S3, W1-W8 and L1-L7 respectively.
2. Comparisons of the problem parameters in pairs with respect to the rate that
they affect the probability of the examined risk. The comparisons made are
based on a series of assumptions related to the importance of parameters and
their values, whose reliability is directly dependent to the analysts’ experience
on the subject. This step is therefore a source of uncertainty. The comparisons
are facilitated by a comparison grading scale that determines the rate of
importance of a parameter i when compared with a parameter j. This scale is
absolutely correspondent to the fundamental scale of Analytic Hierarchy Process
(Saaty, 1990), and is presented in table 2.

Class Description
1 i and j are of equal importance
2 intermediate class
3 i is slightly more important than j
4 intermediate class
5 i is fairly more important than j
6 intermediate class
7 i is much more important than j
8 intermediate class
9 i is absolutely more important than j

Table 2: Comparison grading scale

The comparisons made are presented in a matrix as shown in table 3. When the
importance of parameter j is higher then the inverse values of the comparison scale
are used.

j
i P1 P2 P3
P1 1 1/3 1/3
P2 3 1 1
P3 3 1 1

Table 3: Comparison matrix of parameters

3. Comparison of the parameter values in pairs with respect to the rate that they
affect the probability of the examined risk. This step follows in practice the same
procedure as step 2. The comparison matrix of parameter P1 is demonstrated in
table 4. The matrices of parameters P2 and P3 are similar, hence their
demonstration is neglected.

j
i S1 S2 S3
S1 1 1/7 1/9
S2 7 1 1/7
S3 9 7 1

Table 4: Comparison matrix of values of parameter P1

4. Consistency control of the created matrices.

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5. Computation of normalized Eigen vectors of the matrices of steps 2 and 3.

6. Computation of weight ratios of the problem parameters and parameter values.
7. Computation of the final prioritization factors of each scenario. This is the final
prioritization step. The scenario with the highest factor imposes the highest
probability to risk R3, while the one with the lowest factor imposes the lowest
probability.

A step further stands the estimation of the probability class in which every direct
risk belongs. This can be achieved through a correlation code between prioritization
factors and probability classes, so that every factor corresponds to a certain
probability class. Since there is already a correlation available among the different
scenarios expressed by the prioritization factors, it is sufficient to estimate the
probability class in only one scenario. The probability class of the remaining 167
scenarios can be then derived with a straight forward calculation.

A quick examination of the established scenarios reveals that the probability class
of some of them can be reasonably estimated. Such a case is scenario C164 (S3-
W8-L3). It refers to a large oil spill, occurring under the highest possible wind
speed with unfavorable direction, and is located close to fisheries. In this case the
probability that risk R3 occurs is very high, and thus a probability class 5 can be
considered. C164 can be therefore used as a base-scenario for the calculation of
probability in the remaining scenarios as follows:

VCi
PCi  PC164 (1)
VC164

In this equation VCi is the prioritization factor of scenario Ci, VC164 the prioritization
factor of scenario C164 and PC164 the probability of risk R3 in scenario C164. Since
the performed analysis is quantitative, the probability PC164 is not a certain
numerical value. The only information about it is that it belongs to the range 80-
100% which is indicative of probability class 5. In the present analysis the
maximum probability of the corresponding range is considered for the base
scenarios. This way a conservative risk assessment is accomplished, since the most
unfavorable risk values will be extracted. Choosing the median or lowest value of
the range would result in more favorable risk estimation. This choice constitutes
another source of uncertainty in the analysis.

Another point that needs to be stressed is that the probability calculated with
equation 1 is not a real probability, but it indicates the probability class that
scenario Ci imposes to the examined risk. If for instance PCi is equal to 29%, then
in case of scenario Ci, the probability class of risk R3 is 2.

The risk prioritization process and probability class estimation is repeated six times,
since there are in total six direct risks. The results of this procedure are used in the
probability class estimation of the indirect risks. This estimation can be realized
with the use of the event-tree that has been previously presented and of the
principles of Probability Theory. In particular a methodology with two basic steps is
proposed. These steps are presented below:
1. Empirical assessment of the probability class in which every indirect risk
belongs, when the preceding direct or indirect risk according to the event flow
lines has occurred. This is in fact an empirical determination of conditional
probabilities. The imposed probability classes to the indirect risks that may occur

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after the occurrence of risk R3 are presented in figure 2. This step is highly
subjective and therefore imposes a high degree of uncertainty to the analysis.
2. Assuming that the numerical probability value that corresponds to a certain
probability class is the highest value of its probability range, and according to
the Probability Theory principles, a probability is calculated for every indirect
risk. Similarly to the estimations made for direct risks, the calculated
probabilities are not real, but their value is indicative of the probability class in
which every indirect risk belongs.

5 3
R11 R18
R3
5 3
R12 R18

Fig 2: Probability classes of event-flow lines following the occurrence of R3

It should be noted that there are risks occurring in more that one event sequences,
such as risk R12. According to the event tree of figure 1, risk R12 can be a cause of
the occurrence of risk R3 or of risk R8. The final probability class of this kind of
risks is the most unfavorable of the two resulting classes.

4. Consequence assessment

The consequence assessment of the identified risks follows a methodology similar

to the one of the probability assessment process. The two problems are not
identical, hence some adaptations are necessary. In accordance to the probability
assessment, the consequence assessment process is qualitative and makes use of a
consequence class scale with the integer numbers from 1 to 5. The description of
the consequence classes is absolutely correspondent to this of the probability
classes.

The risk consequence is affected by five parameters. The three of them are the
same with the probability parameters, P1, P2 and P3. The remaining two
parameters are the following: P4) Oil type, P5) Season. The possible values of oil
type are: O1) Crude oil and O2) refined oil. The possible season values are: T1)
Spring, T2) Summer, T3) Autumn, T4) Winter.

In total 1344 new oil spill scenarios are produced with combination of the
parameter values. The risk prioritization with respect to consequence is
accomplished through application of the modified form of Analytic Hierarchy
Process. The followed steps are identical to the ones presented in chapter 3. The
determination of the consequence class in which every identified risk belongs
follows too the base-scenario technique that has been used for determining the risk
probability classes. Unlike the probability assessment, the determination of
consequence classes does not differ between direct and indirect risks. The severity
of consequences of any risk is considered correlated to the oil spill scenarios, and
there is no correlation between the consequences of direct and indirect risks. Hence
all risk consequences are calculated with the same method.
A minor divergence between the base-scenario technique for probability and
consequence assessment is that there are no ranges of consequence indicative of
the consequence classes to be used as boundary values. The consequence classes
could be described with damage ranges expressed in real damage costs. Such
quantification is out of the scope of a quantitative analysis. A practical solution to
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this problem is the use of numerical ranges correspondingly to the probability

ranges for indication of each consequence class. Thus class 1 can be described with
the range 0-20, class 2 with the range 21-40 and so on.

5. Risk assessment

Following a qualitative probability and consequence analysis, the risk assessment

has to be qualitative as well. A risk scale similar to the scales of probability and
consequence is necessary in this process too. The proposed scale contains three
classes, 1, 2 and 3 correspondent to low, medium and high risk respectively. The
nature of results extracted by the two previous processes enables the use of a
probability-consequence table, which seems to be the most appropriate technique
for the assessment of risks. The table used is presented in figure 3.

5 5 10 15 20 25
Probability

4 4 8 12 16 20 high risk
3 3 6 9 12 15 medium risk
low risk
2 2 4 6 8 10
1 1 2 3 4 5

1 2 3 4 5
Consequence

Fig 3: Probability-consequence table

The probability-consequence table technique is applied for every risk in all oil spill
scenarios. The scenarios used in this process are the ones that have been used for
the consequence assessment. The 168 scenarios of the probability assessment are
integrated in the consequence scenarios.

Some indicative results of the analysis performed for risk R3 in five random
scenarios are presented below (table 5).

Scenario Descriction Probability Consequence Risk

class class class
C1 S1-W1-L1-O1-T1 2 2 1
C255 S1-W5-L4-O2-T3 2 1 1
C589 S2-W3-L4-O1-T4 1 2 2
C1050 S3-W3-L6-O1-T2 3 5 3
C1341 S3-W8-L7-O2-T1 5 3 3

Table 5: Risk assessment results for risk R3

6. Conclusions

 A methodology for probability and consequence assessment is developed which

is based on Analytic Hierarchy Process. After some appropriate modifications,
Analytic Hierarchy Process is transformed from a decision-making technique into
a tool for risk prioritization and qualitative risk analysis.

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 The risk prioritization is achieved through the comparative evaluation of the

problem parameters and their values, and not through a direct risk assessment.
A rationalization of the risk assessment stages is attempted with this approach,
which facilitates the discrimination of uncertainties imposed to the analysis.

7. Recommendations

 The developed methodology refers to an oil spill risk analysis. Appropriate

alterations of the problem parameters enable its application in other kinds of
hazards as well, such as flooding, failure of structures and nuclear accidents.
 An objective evaluation of the methodology through a validation is necessary.
This can be achieved with application in a real area by experienced analysts.
Such a procedure can indicate elements that need to be reconsidered.
 The methodology indicates the sources of uncertainty in the risk analysis.
Further research on the deviation of the final results caused by the imposed
uncertainties would highly contribute to the reliability of the analysis.
 The possibility of transforming the method to a quantitative analysis tool is
interesting to be examined. This can be possibly realized by correlating the
qualitative probability and consequence classes with real probabilities and
damage costs respectively.

8. Acknowledgements

This research has been realized in the framework of the author’s graduation work at
Aristotle University of Thessaloniki under the supervision of Dr. Y. Xenidis and Prof.
D. Angelides, whose contribution is acknowledged and highly appreciated.

9. References

Kassomenos, P.A. (2004), “Risk analysis for environmental hazards: the case of oil
spills in Crete”, Global Nest: Int. J. Vol. 6, No 1
Molloy, F.C., White, I.C. (2003), “Factors that determine the cost of oil spills”, IOSC
2003
Saaty, T.L. (1990), “How to make a decision: The Analytic Hierarchy Process”,
European Journal of Operational Research 48, North-Holland
Tsimopoulou, V. (2008), “Development and prototype application of an oil spill risk
analysis in a coastal zone”, Thessaloniki, Greece (diploma thesis)
White, I.C., Baker, J.M. (1998), “The Sea Empress oil spill context”, International
Conference on the Sea Empress Oil Spill 1998, Cardiff, Wales

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AA013

Analysis of Project Performance of a Real Case Study and

Assessment of Earned Value and Earned Schedule Techniques for the
Prediction of Project Completion Date

Theodoros Tzaveas
(Project Engineer, Egnatia Odos S.A., Thessaloniki, Greece)

Stefanos Katsavounis
(Assistant Professor, Democritus University of Thrace, Xanthi, Greece)

Glikeria Kalfakakou
(Professor, Aristotle University, Thessaloniki, Greece)

Abstract
The management of a project, especially in the construction industry, is without
doubt a subject of high interest, demanding and complex and in the same time
challenging and exciting. In the line process of planning-supervision-control, the
last element enables the manager to determine the deviation range of actual
practice from the original planning. Developing a construction schedule for a
complex viaduct using the software MS Project 2007, and tracking the progress
with real dates and durations, the results of Earned Value (EV) and Earned
Schedule (ES) techniques are assessed regarding the duration forecasting accuracy
schedule performance of a late finish project. The schedule includes complex
interrelations, logistics in relation to the effective management of construction
equipment and unforeseen events during the construction process. Three different
scenarios are examined, from the construction of the whole bridge to a single
structural element in order to assess the effectiveness of the methods, their
sensitivity to re-baselining, and the contribution of critical tasks to the end result.

Keywords
Construction Management, Earned Value, Earned Schedule, Microsoft Project,
Egnatia Odos AE

1. Introduction

In project management, it is vital to have adequate means of obtaining information

about the progress of a project against a baseline and the anticipated outcome of
the project. The information are required to (1) assure managers that the project is
progressing within acceptable budget, schedule and quality expectations; (2)
support decisions to approve the movement of the project through its stages, and
(3) confirm subjective assessments that benefits will be realised. A project has
traditionally been viewed as successful if it was completed on time, within budget
and with the specified quality. More recent views of project management consider a
project successful if it came in within its original schedule and its expected cost, but
also if it still works after the implementation as suggested by Mahaney and Lederer
(2008) with a particular relevance to construction projects. EV systems, being a
standard method of measuring project performance, have been setup to deal with
the complex task of controlling and adjusting the baseline project schedule during
execution, taking into account project scope, timed delivery, and total project
budget. Vanhoucke and Vanvoorde (2006) state that although EV systems have
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been proven to provide reliable estimates for the follow-up of cost performance
within certain project assumptions, it often fails to predict the total duration of the
project. Although there are barriers to having an estimating formula for predicting
final project duration from EVM data, it remains a desired capability. Project
managers (PM) need the ability to generate reasonable estimates of the duration.
Furthermore, they need to be able to estimate a revised completion date at every
reporting period without having to exhaustingly evaluate the tasks remaining each
time. That is, to manage cost and schedule equally well, PMs need comparable
analysis capability for both (Lipke and Henderson, 2006). Earned Value Method
(EVM) has not been as successful in assessing schedule performance. After a
project is about two-thirds complete, EVM schedule performance metrics become
unreliable, as EV invariably converges on PV. Another question frequently asked is
how the project managers handle the effects of re-baselining in making their
forecasts. Lipke (2008) states that in the research it was discovered that there is a
little discussion of the topic, in even the best EVM reference books.

Lipke in 2003 proposed the concept of 'Earned Schedule" (ES) to address these
issues. Rather than just looking at schedule performance using the value of work,
earned schedule also looks at when the work was to be completed. ES aims to
measure schedule performance using a time-based measure from which time based
measures of Schedule Variance (SV(t)) and Schedule Performance Index (SPI (t))
metrics are derived. The ES concept is claimed to be analogous to EV and can be
used to calculate measures intended to be analogous to EVMs cost based
counterparts. Small scale research mainly focused on IT or high technology projects
has occurred throughout the evolution of ES. Although lack of testing is a
drawback, the risk associated with ES usage is minimal. Henderson (2003)
suggests that one compelling point supporting ES is that, regardless of the
circumstances of the application (who, project type, company, country), the
findings from all sources are consistent. The ES method, in every application,
outperforms other EVM-based methods for representing schedule performance.

The purpose of the paper is to examine the capability of the methods to represent
the schedule performance effectively in a late construction project with inherent
complexities and unforeseen events. It is also to test the capabilities of the
methods to adequately forecast the final duration. The analysis includes three
parts. First, we compare the classic earned value performance indicators SV and
SPI with the newly developed ES performance indicators SV(t) and SPI(t) and their
forecasting accuracy, during the assessment of the overall viaduct construction
schedule. Next, we present the comparable findings when a re-baselining takes
place at an early stage of the project. Finally, we illustrate the use of each method
on lower-WBS level where the majority of activities are part of the critical path of
the project. The methodological approach is outlined in detail and results are
presented in tables and graphs. The conclusion is that the ES concept has validity.
The ES based schedule metrics more accurately portray a project's schedule
performance compared to the EVM equivalents.

2. Project monitoring tools, EVM vs. ES

Earned Value Management (EVM) uniquely connects cost, schedule, and

requirements thereby allowing for the creation of numerical project performance
indicators and enable to managers to express the cost and technical performance of
their project in an integrated and understandable way to employees, superiors and
customers. EVM has three measures: Planned Value (PV), Actual Cost (AC), and
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Earned Value (EV). The planned values of the tasks comprising the project are
summed for the periodic times (e.g., weekly or monthly) chosen to status project
performance. The time-phased representation of the planned value is the
Performance Management Baseline (PMB). AC and EV are accrued and are likewise
associated with the reporting periods. For each measure, the time-phased graphs
are characteristically seen to be "S-curves”. From the three measures, project
performance indicators are formed. The schedule indicators are: SV = EV - PV, and
SPI = EV / PV, where SV is the schedule variance and SPI is the schedule
performance index. The fact that PV equals BAC at the planned completion point
and does not change when a project runs late causes the schedule indicators to
falsely portray actual performance. In fact, it is commonly observed that the
schedule indicators begin this behavior when the project is approximately 65%
complete (Lipke, 2008). The irregular behavior of the schedule indicators causes
problems for project managers. At some point it becomes obvious when the SV and
SPI indicators have lost their management value. From this time of uncertainty
until project completion, the manager cannot rely on the schedule indicators portion
of EVM. For all of the accomplishments of EVM in expressing and analyzing cost
performance, it has not been as successful for schedule performance. The EVM
schedule indicators are, contrary to expectation, reported in units of cost rather
than time. Beyond this problem, there is the much more serious issue: the EVM
schedule indicators fail for projects executing beyond the planned completion date.

The technique to resolve the problem of the EVM schedule indicators is Earned
Schedule (ES). The ES idea is simple: identify the time at which the amount of
earned value (EV) accrued should have been earned (Lipke, 2003). By determining
this time, time-based indicators can be formed to provide schedule variance and
performance efficiency management information. Projecting the cumulative EV onto
the PV curve (i.e., the PMB), determines where PV equals the EV accrued. This
intersection point identifies the time that amount of EV should have been earned in
accordance with the schedule. The vertical line from the point on the PMB to the
time axis determines the "earned" portion of the schedule. The duration from the
beginning of the project to the intersection of the time axis is the amount of Earned
Schedule (ES). With ES determined, time based indicators can be formed. It is now
possible to compare where the project is time-wise with where it should be in
accordance with the PMB. Actual time (AT) is the duration at which the EV accrued
is recorded. The time-based indicators are easily formulated from the two
measures, ES and AT. Schedule Variance becomes SV(t) = ES - AT, and Schedule
Performance Index is SPI(t) = ES / AT. The computed value of ES describes where
the project should be in its schedule performance.

3. The project

Egnatia Odos, part of the Trans-European Road Network and one of the 14 priority
projects of the EU, is a modern 680km highway, stretching from one side of Greece
to the other. Being one of the few Greek highways to be designed and built to full
up-to-date national and modern international specifications has been described as
Europe’s most difficult and modern motorway. The case study used in this paper is
related to the construction of complex viaduct is part of the significant structural
content of a 37km section 720m€ from Panagia to Grevena in the western part of
the motorway, crossing a mountainous area with complex geology and severe
environmental constraints.

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4. The case study of a bridge construction and the monitoring of

the construction schedule

This bridge carries the road over the deep valley of a river (Figure 1). At the
southern end of the valley the carriageway splits into two separate viaducts, the
lengths of which are different due to the prevailing topography. The structure
consists of twin segmental box girder viaducts, with integral piers varying in height
from 29m to 70m. The ground conditions are variable with visible fractures in the
rock slope formations. The overall length is 636.20m and 531.10m for the
eastbound and westbound structures respectively. The isolated site, with its steep
70m-deep valley, required a bridge solution driven more by construction method
than anything else, which is why a balanced cantilever bridge was chosen.
Similarly, the position of the river Venetikos in relation to the steep valley slope
resulted in spans up to 120m.

Fig 1: View of the viaduct

4.1 Time Schedule Details

In a bridge of such size and complexity, overall time is mainly determined from the
construction equipment (machinery, cranes, and formworks) which is available on
the construction site and obviously not all activities start simultaneously. Thus in
addition to the scheduling of works for the construction of foundations and pier
walls, critical activities for the completion of the bridge are the available number of
formwork for the construction of pierhead and cantilevers, and effective use and
transfer from pier to pier. A WBS established to make such a complex project more
manageable and is formed in such a way to help breakedown the project into
manageable chunks that can be effectively estimated and supervised. The analysis
followed the determination of deliverables with a four level breakdown structure.
Resources include the detailed quantites of all the items of the bridge construction
(concrete, reinforcing steel, prestresssing steel, earthworks, accessories) in
accordance with the design provisions and tender documents. The overall cost of
the bridge is estimated at 19.6 m€. The start date of the construction was the 27th
of May 2005, with a planned duration of 129wks. The schedule is characterized by
slow early progress, followed by a significant acceleration following completion of
about 10% of works. The actual duration was 145.2 wks.

4.2 Particular aspects of construction

There are several factors affected the schedule performance. Some of them were
unforeseen events others required re-work of several activities. However most or
all of them are common in the construction projects. Variations in the initially
assumed geotechnical conditions, under-skilled personnel in demanding activities,

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late supply and management of equipment, bad concreting and a fire incident are
the main aspects influenced the schedule performance.

4.3 Analysis and results

For the analysis of the overall bridge construction schedule, nine control periods
were determined taking into account the percentage completion of works and main
events along the timeline of the project. In Table 1, the control dates are presented
along with the corresponding items.

Control 1 2 3 4 5 6 7 8 9
period
Wk. No. 10 19 37 45 76 89 106 123 141
Compl.% 1 3 7 11 34 44 66 84 96
Table 1: Data related to the control periods of the schedule

Based on the activities progress and completion dates, the curves of Earned Value
(EV) and Planned Value (PV) against cost are prepared at each control period,
followed by the accumulation of all the results representing the overall schedule
performance as illustrated in Fig 2.

Fig 2: PV, EV curves for the 3rd control period and the overall schedule

Following the principles and techniques of the methodologies presented in the

precedence paragraphs, the main duration metrics and indices are calculated with
both methods. EV metrics are obtained directly from MS-Project where ES values
are processed manually. Fig 3(a), portrays the forecasting performance of the two
methods, along with the actual duration (in black) and the Critical Path(CP) analysis
(in red) for comparison. It is apparent that Earned Schedule converges faster
towards the actual duration but without any remarkable results. It is also clear that
CP forecast, continuously underestimates the actual duration. The schedule
performance is illustrated in Fig 3(b), where SPI for both methods is plotted against
the percentage of work performed. It is clear, from a value of as low as 0.2, that
there is a late start and slow progress at the beginning up to approximately 1/3 of
the work completed, which clearly indicates a problematic project. The tendency of
the SPI(c) to reach a value of 1.0 is clearly noted even though the project is late
and exceeded the original contractual deadline, and that occurs at about 66%
completion, that is when 2/3 of the project is effectively complete.

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Fig 3 : (a)Comparison of forecasting accuracy and (b)Schedule Performance Index

A second analysis includes the assessment of the two methods during re-baselining.
During this process a revised baseline is set, which purposely involves the BCWS of
the 3rd control period since it corresponds to approximately 10% of work
completion. A recalculation of EV and ES metrics is carried out in order to assess
the forecasting result, having recovered the project form a late start. In Fig 4, the
revised baseline (in red) is plotted against the original PV (in brown) and the EV
curve (in green).

Fig 4 : Re-Baselining and ES,EV metrics

The values from the analysis and the revised indices are shown in Table 2. It is
remarkable how the schedule performance index is improved, with values of 0.7
and 0.9 for EV and ES analyses respectively comparing with original corresponding
values of 0.49 and 0.56. What is to be noted is that the forecasting made with ES is
144.7wks is remarkably close to the actual duration of 145.2wks, whereas EV
suggests a value of 189wks.

EV & ES Metrics Original Baseline New Baseline

BCWP, EV(€) 2.239.983,37 2.239.983,37
BCWS, PV(€) 4.582.255,75 3.034.095,15
SV(c) (€) - 2.342.272,38 - 794.111,78
SPI(c) 0,489 0,7
ES 25,01 40,11
SV(t), (wks) -19,99 -4,89
SPI(t) 0,56 0,89
Forecasting with ES 232,08 144,72
Forecasting with EV 263,80 184,29
Actual 145,2 145,2
Table 2 : Data of ES and EV extracted from re-baselining

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A third analysis included the schedule performance of a single structural element

which includes the foundation and column of the pier, the pier table and the
cantilevers. The pier selected, has all its activities along the critical path of the
project. The control periods are now coinciding with the full completion of a
structural section or activity. The schedule consists of 64 activities with a small and
controllable duration. The planned duration was 48.2 weeks. Thirteen control
periods were set from the start date to 100% completion of the cantilevers. Fig 5,
illustrates the schedule performance and the project duration forecasting. It is
stated that the planned work should have been completed at 62% completion. It is
very clear from the first diagram that SPI(c) tends to increase at 2/3 completion in
order to receive eventually the value of 1.0, thus not accurately representing the
schedule performance. On the contrary SPI(t) follows a smoother trend, with a
better representation of the performance reaching a value of 0.8. Very good
convergence is shown by ES after the 43rd week which corresponds to the 50%
completion at a SPI(t) value of around 0.6. On the contrary convergence using EV
is reached after the 80% completion of works. Almost accurate is the CP but that is
explained from the fact that all activities are in critical path therefore the software
provides almost the exact duration throughout the schedule.

Fig. 5 : Schedule performance and forecasting accuracy

5. Summary and conclusions

Highway construction projects are quite uncertain in nature and often are late,
exceeding original budget. Although responsibilities of parties and causes of such
events are interesting to explore further in a contractual framework, for a client
who needs to prioritize work and effectively manage European funding within strict
deadlines, the ability to forecast the end date of a project and have progress
indicators early in the course of construction and at least before the 2/3 of the
duration, is of vital importance. Testing the performance of the techniques on an
actual construction project was a challenge as it allows easy comparisons of the
forecasting ability and performance indicators analytically obtained, with real
values. In this paper, we presented an application of the EV and ES methodologies, as
specific-duration methods, using EV metrics and evaluate them on real-life construction
project data extracted from a complex viaduct in Egnatia Odos highway, using MS-Project.
The three analyses carried out reveal the superiority of the ES method showing reliable
results during the whole project duration, confirming conclusions previously published in
literature related to the weakness of the EV method to produce reliable duration forecasting
even at 50% project completion. The ES method seems to provide valid and reliable results
along the project's lifespan. The value of the paper to practicing professionals can be
summarized in the following items:

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1. It demonstrates the application of the two methods on a late construction

project with variations and unforeseen events, having the actual data of the
schedule as planned, the actual progress and the actual finish date.
2. The methods are tested with three scenarios including a re-baselining of the
schedule and a group of activities along the critical path, giving a very good
insight of how the methods are performing in each case in terms of forecasting
the duration and progress indicators and compared with the real case.
3. It helps the reader and potential user of a tracking method, to get an
appreciation of the use of the techniques for particular cases and how the
indices resulting from the methods should be read, their reliability during the
2/3 duration of the project and how these can be assessed and combined to
obtain a good idea of how the schedule is performing leading to an optimum
decision to recover from a possible disaster.

As a conclusion, the use of EVM or the ES method depending on the need and knowledge of
the project manager might lead to similar results for project monitoring in the early and
occasionally in middle stages. However this statement can be misleading if a re-baselining is
applied at early project stages, and that needs to be handled very carefully. In general, the
EV metrics shall be set-up as early warning signals to detect potential problems in an easy
and efficient way. Our forecasting results and the assessment of schedule performance on
the three cases demonstrate that reliable early warning signals are obvious. We refer to
Cooper (2003) stating that the use of EVM can be questioned when they are applied in
highly complex projects. Due to the cycles of rework, the accuracy of the EVM metrics can
be biased, leading to incorrect management decisions. Therefore further investigation is
necessary to this research topic and more data is necessary for assessment and comparison
when a complex project also subject to a vast amount of rework cycles.

6. References

Cooper, K.G., (2003),” Your projects real price tag”, Harvard Business Review,
81(12):122.
Henderson, K., (2003), “Earned schedule, A Breakthrough extension to Earned
Value Theory”, The Measurement News, PMI College of Performance
Management.
Lipke, W., (2003), “Schedule is different”, The Measurable News, PMI College of
Performance Management.
Lipke, W., (2008), “Project Duration Forecasting: Comparing Earned Value
Management Methods to Earned Schedule”, The Journal of Defense Software
Engineering(Dec.), 10-15.
Lipke, W. and Henderson, K., (2006), “Earned Schedule: An Emerging
Enhancement to Earned Value Management”, The journal of Defense Software
Engineering, 26-30.
Mahaney, R.C. and Ledered. A.L., (2008), “The role of monitoring and shirking in
information systems project management”, International Journal of Project
Management, 28, 14-25.
Velde, R., (2007), “Time Is Up: Assessing Schedule Performance with Earned
Value”, PM World Today, Vol.IX, Issue X.
Vandevoorde, S. and Vanhoucke, M., (2006), “A comparison of different project
duration forecasting methods using earned value metrics”, International Journal
of Project Management, 24, 289-302.

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NGO3

Social economy and certification in the context of the EQF

Anastasios Vasiliadis
(Universtity of Aegean, Rhodes, Greece)

Georgia D. Christodoulopoulou
(Project Manager, Institute of Entrepreneurship Development, Larissa, Greece)

Ioanna C. Leontaraki
(Project Manager, Institute of Entrepreneurship Development, Thessaloniki, Greece)

Abstract
One of the economy sectors, which in the past years has been concentrating the
interest of researchers is that of the social economy, contributing to the
development of regions and support of groups of the population that are struggling
with significant problems of unemployment. The lack of a specialized executive
dynamic workforce, and especially the weakness of the typical educational system
to adapt to new data and conditions, has led many individuals with insufficient
typical qualifications to be active as advisors and/or educators of social economy.
The present paper deals with the development of a professional profile of the
advisor of social economy and an innovative method of certification of non-formal
learning that responds to the directional guidelines of the EU in relation to the
recognition of learning outcomes. The research that was conducted, utilizing the
Delphi Method on 45 participants in 3 different EU countries revealed a necessity
for the certification of informal learning in the specific field. With regards to the
methodology of certification, a new, innovative method of correlation of the
learning outcomes with the European Qualifications Framework is being proposed.
In parallel, the need for further research in the field of social economy, and
especially with regards to the methods of exploitation and integration of the
suggested methodology to non-governmental organizations, is highlighted.

Keywords
Social economy, Certification of informal learning, European qualifications
framework, Social consultant, Non Governmental Organisation

1. Introduction

The sector of social economy, one of the most developing sectors, employed more
than 11 million individuals in Europe in 2007 (CERIEC, 2007), while it also
presented with remarkable progress in the last years in all member states of the
EU, has created new prospects of employment, which are based on the combat of
discrimination and exclusion from the labor market, and has created favorable
conditions of development of entrepreneurial initiatives, while meeting the needs
for the provision of social services.
However, despite the development of the sector, significant weaknesses are
observed as to its development with the most significant one constituting the lack
of an integrated framework for the dimensions, characteristics, organization and
functioning of the specific sector, especially in Greece. The aforementioned
deficiency has led to the entrance of non specialized individuals that undertake the
counseling and education of individuals and institutions that are active in the social

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economy, which most often are unable to cope with modern day requirements. As a
result, the validation of non-formal and informal qualifications constitutes a
challenge that will improve the qualifications of executives and will contribute to the
development of the sector. The present work discusses and presents the
development of a professional profile of the advisor of social economy and an
innovative method of certification of non-formal learning that responds to the
directional guidelines of the European Union in relation to the recognition of
learning outcomes. The sector of Social Economy is presented in continuation, as
well as the certification of qualifications, the methodology with which the research
was conducted, and the results and conclusions of the research.

2. Social economy: A third sector in economies

The Social Economy is defined as the sector of the economy that is found between
the private and public sector of the economy, in which economic activities with
social aims and objectives are being concluded in. The European definition of social
economy supports that social enterprises are particularly active in certain fields
such as social protection, social services, health, banking, insurance, agricultural
production, consumer affairs, associative work, craft trades, housing, supply,
neighbourhood services, education and training, and the area of culture, sport and
leisure activities” (CEPCMAF, 2002). The definition of social economy may also be
supplemented by Roelants (2002) definition where social economy is the part of
economy where enterprises are created by and for those who have common needs
and are responsible for those to whom they are to serve. Social economy is also
defined as the specific kind of entrepreneurship with unique features, which is
assessed by its contribution into solidarity field, social cohesion and territorial
development.
Between the member states of the European Union, Italy is the only member state
throughout the 90s that allocated specific legislation for social enterprises. Later, in
1995 and afterwards, Belgium, France, Portugal, Finland and Lithuania drew up
relative legislation (National Institute of Employment, 2002). In Greece the
participation of the third sector to the employment represents the 1% to 2% of the
total employment in Greece. More specifically, in the third sector approximately
68,700 people are employed which represent the 1.8 % of the total employment
and the 3.3 % of the paid employment (Chrysakis et al. 2002). The main interest
and focus of social enterprises is either socially or geographically excluded people
and the enterprises in social sector are usually Very Small Enterprises VSEs.

3. Advisors of social economy

Independent of the realized benefit of social economy to sustainable development

and employment/entrepreneurship, in our country the meaning and activities of the
sector of social economy are not yet developed. The lack of an integrated
framework in secondary and tertiary education for the dimensions of the sector of
social economy and the lack of the “deliverance” of the third sector contribute to
the involvement of individuals in the area of social economy employed as
advisors/educators that are either characterized by a lack of qualifications or the
allocation of non-certificated informally acquired knowledge.

4. The professional outline

In order to set the limits to the object of the advisor of social economy, the
determination and definition of all tasks that he executes is necessary, leading to
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the development of the professional profile of the profession. The “Professional

Profile (P.P)” includes the overall basic and individual professional tasks and
functions that make up the object of work of the profession, as well as the
respective knowledge, skills and competences that are required for the
correspondence to these functions and tasks (Greek Ministrial order, 2006).
The analysis of the profession is concluded in four levels (a) Main Professional
Functions (MPF), (b) Individuals Professional Functions, (c) Professional Activities,
(d) Knowledge, Skills, Competences, (Halas, 2002).

5. The certification of advisors and the European Qualifications

Framework (EQF)

The certification of informal learning constitutes a significant parameter for the

personal and professional development of a significant number of professions, as
well as for mobility in the labor market. It is especially significant that practices for
the recognition of past experience of individuals are adopted for professions that
have recently appeared in the labor market, such as the social advisor/educator,
where the delimitation of the profession and the recognition of learning are deemed
necessary, especially in the context of the fulfillment of the strategy of lifelong
learning for the recognition and evaluation of learning outcomes. As a matter of
fact, the process of recognition of informal learning causes significant issues with
regards to its acceptance and inclusion in the different systems of education and
training throughout Europe. The certification of learning outcomes is able to satisfy
the objectives only if these are recognizable and transferable throughout Europe.
The EQF is a common European reference framework which links the qualification
systems of the countries, acting as a translation device for easier reading and
understanding of qualifications across different countries and systems in Europe.
The common reference level of the EQF contains eight levels, each level is
determined by a set of descriptions that indicate the learning outcomes associated
with the main functions of each profession.
So far only partial analysis efforts of the profession of the advisor of social economy
with a European dimension have been observed, while internationally, the only
attempt to certify learning outcomes of advisors/educators was implemented by the
Scottish Qualifications Authority but which does not propose a specific methodology
of certification.
Since the previous review, the need for the development of the Professional Profile
of the advisor/educator of social economy and the development of a proposed
methodology of certification of the learning outcomes that is in line with the EQF
becomes apparent.
As a result, it is important to answer research questions such as: a) what are the
basic tasks that an advisor of social economy executes? B) At what level is it
assigned to the EQF; (c) what is the recommended method for the certification of
learning outcomes? d) What is the importance/weighting of learning outcomes and
assessment categories in the certification?

6. Methodology

For the development of professional profile, the tools utilized for the concentration
of information were: literature desk research for the collection of necessary
information concerning the profession and its dynamic and the adapted to the
needs of the Professional Profile Delphi method (Halas, 2002). The Delphi method
included a coordinator for each participating country and 15 individuals who are

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active in the field of social economy (academics and professionals). The research
took a sample of 45 participants in 3 different EU countries.
Regarding the process of assigning the learning outcomes of the advisor/educator
of social economy to the EQF, 3 workshops (1 for each country) with 10 experts,
each followed by qualitative interviews were concluded. They included the
correlation of each MPF to the level of the EQF, depending on the learning outcomes
that are required (Leveling), the statement of the weight of each MPF relating to
the learning outcomes required (Weighting Procedure) and the evaluation of the
results by experts of other European countries. Finally, literature desk research for
the collection of necessary information relating to the methods of valuation of
informal learning and 3 workshops (1 in each country) with qualitative interviews
by 3 experts in each workshop were carried out for the process of assessment and
evaluation of the learning outcomes and the certification of informal learning.
The research instrument for the development of the Professional Profile was a
structured questionnaire description of the profession, adapted to the basic features
of the Delphi method, based on a review of international literature. The
questionnaire was designed to extract individual expert responses to the problem at
hand and to allow for the processing of views.
The research instruments for the process of correlation of the learning outcomes
with the EQF included a set of template forms evaluating the level of the EQF in
correspondence to each learning outcome and the weighting of each outcome,
which were adapted to those of the Advisor of Social Economy. The templates were
designed in the context of a Leonardo da Vinci project for the assigning of EQF
levels to existing qualifications in the financial sectors across EU member states,
under the Lifelong Learning Programme (€QUALIFISE, 2008).

7. Results

a) The basic tasks that an advisor of social economy must execute

From the summary of the results obtained, the following Main Professional
Functions (MPF) resulted regarding the Professional profile of the advisor of Social
Economy.

MPF
GR IT PL Total

Welcome, Supports and Serves the individuals

referring to the institution - 10% 5% 15%
Advises/Trains interested individuals in general
20% 25% 15% 60%
entrepreneurial and business issues
Advises/Trains interested individuals in organizational
20% 10% 20% 50%
and management issues
Advises/Trains interested individuals in issues
20% 15% 15% 50%
relating to marketing and business communication
Materializes educational and training adult programs
20% 20% 20% 60%
in the sector of social economy
Supports the processes of dissemination of services
10% - 15% 25%
of the institution and entrepreneurship
Supporting social capital mobilization – managing
human resources - 5% - 5%
Activities supporting self-employment - 5% - 5%
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Activities supporting financial capital mobilization for

- 10% - 10%
the social economy objectives usage.
Activities supporting social problems elimination
which generate pathologies 10% - - 10%
Table 1: Weighting of the MPF of the Professional profile of the advisor of Social
Economy

The MPFs that prevailed and are proposed, as they emerged from the development
process, include the following:
 Welcome, Supports and Serves the individuals referring to the institution (MPF
1)
 Advises/Trains interested individuals in general entrepreneurial and business
issues (MPF 2)
 Advises/Trains interested individuals in organizational and management issues
(MPF 3)
 Advises/Trains interested individuals in issues relating to marketing and
business communication (MPF 4)
 Materializes educational and training adult programs in the sector of social
economy (MPF 5)
 Supports the processes of dissemination of services of the institution and
entrepreneurship (MPF 6)

b) Level of assigning the professional profile to the EQF?

Composing the results of the workshop of evaluation materialised in Greece and the
results of the workshops of evaluation that were materialised by the partners in
their countries, the final results with regards to the level of the EQF that the
Certificate of Advisor/Educator of Social Economy receives is apparent.

GR PL(1) PL(2) IT TOTAL

EQF % EQF % EQF % EQF %
EQF %
Leve weigh Leve weigh Leve weigh Leve weigh
Level weighting
l ting l ting l ting l ting
Knowle
5 39% 5 38% 5 30% 5 39% 5 36%
dge
Skills 5 22% 5 31% 5 30% 5 22% 5 26%
Compet
5 39% 5 32% 6 40% 5 39% 5 38%
ences
5 100% 5 100% 5 100% 5 100% 5 100%
Table 2: Final level of EQF and weighting that the Certification of Advisor/Educator
of Social Economy receives.

c) proposed methodology (categories) for the certification of learning outcomes

From the summary of the results of literature desk research and the workshops of
the experts, the proposed methodology of assessment and certification of learning
outcomes consists of three stages, (a) Evaluation and assessment of the curriculum
vitae, (b) on-line test with multiple choice questions and (c) development of a case
study.
The valuation of the CV was based on a standard electronic tool that includes four
major areas: (a) Education, (b) Training, (c) Work Experience, (d) Additional
Skills/Abilities. The axes of Education, Training and Work Experience are separated
depending on their relevance or not to the Social Economy, while the score of each
variable is also defined respectively. The maximum score for each basic axis so that
education is not a substitute for professional experience and vice versa, has been
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set as follows: 25% Education, 25% Training, 30% work experience and 20%
Skills/Abilities. The maximum score that can be collected by each participant from
the CV is 100.
The conclusion of the online test was based on an appropriate educational platform
(moodle) which hosts a database with approximately one thousand questions from
which participants were asked to answer 100. All questions are scored equally
(considering that the process of weighing questions of primary and secondary
business functions/thematic took place prior to the exam). The maximum score
that can be gathered from the online test is 100.
The third category of evaluation relates to a database of approximately 60 Case
Studies that concern the social economy and cover at least three MPFs of the profile
of the advisor of social economy. The evaluation of the case study is based on three
pillars (a) Content, (b) Written Presentation and (c) Support CASE STUDY.

d) Weighting of learning outcomes and categories of assessment and evaluation in

the certification?
The table that follows shows the category and percentage with which each learning
outcome is evaluated and assesses, in accordance to the results of the expert
groups.

CASE
CV TESTTotal
STUDY
Knowledge - 70% 30% 100
Skills 20% 60% 20% 100
Competences 30% - 70% 100
Table 3: Percentage of evaluation of each learning outcome per category

The percentage weight of each category of evaluation (curriculum vitae, online test,
case study) results from the percentage of evaluation of each learning outcome per
category (table 3) depending on the weight given to each learning outcome from
the process of correlation/assigning to the EQF (table 2).

CASE
CV TEST Total
STUDY
Knowledge - 25,214 10,8 36
15
Skills 5,2 15,6 5,2 26
Competences 11,4 - 26,616 38
16,6 40,8 42,6 100
Table 4: Weighting of each category of evaluation in the overall score

8. Conclusions

The social economy sector has not become an important pillar of economic growth,
which enhances both the employability and quality of life of local communities and
can be shown to cover economic and social purposes not covered by the public and
private sector. However, the lack of an integrated framework for the dimensions of
the sector contributes to the depreciation of the competitiveness of human
resources, which in the absence of a single framework for the recognition of l

14
70 (percentage of knowledge that the online test evaluates, table 3)*36% (percentage of weighting of knowledge, table 2)
15
20 (percentage of skills that the CV evaluates, table 3)*26% (percentage of weighting of skills, table 2)
3
70 (percentage of competences that the case study evaluates, table 3) *38% (percentage of weighting of competences, table 2)
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earning fails to respond to current trends. Therefore, the definition of the profession
of the social economy advisor and the development of a methodology for the
validation of informal learning harmonized with the EQF would assist in addressing
these challenged.

The present paper, compiled after literature desk research and the use of the
Delphi method in three European countries, proposes the Professional Profile (P.P)
of the advisor of social economy, which consists of six MPFs, which the advisor
must be able to perform. The process of assigning the P.P with the levels of the
EQF, which was based on qualitative interviews with 30 experts of three EU
countries, shows level 5 of the EQF as appropriate. The proposed method of
certification of learning outcomes, which results from literature desk research and 9
qualitative expert interviews in three EU countries, includes three categories, the
valuation of the CV, the conduct of an on-line test of multiple choice questions and
the preparation of a case study. According to the survey results, knowledge
represents 36% of the learning outcomes that an advisor of social economy should
have, skills represent 26% and competences 38%. The contribution of each
category to the final certification of learning outcomes results as follows: CV
16.6%, on-line test 40.8% and case study 42.6%.
The impact of the present paper is to overcome the lack of qualifications of
advisors, to upgrade their knowledge and skills, to the transparency of
qualifications in the labor market and to facilitate mobility in the workplace.
However, it is important to further explore the application of the methodology by
the target group to determine the degree of response to the needs of advisors of
social economy. Furthermore, it would be useful to explore whether the proposed
methodology can be applied to other professional profiles that require the
recognition of non-formal learning.
Finally, it would important to develop the Professional Profile of executives of NGOs
and the development of methodology for the certification of learning outcomes
harmonized with the EQF.

9. References

National Institute of Employment, (2002). Prospects of Employment in the sector of

social economy, Sakkoula Publications, Athens.
Greek Ministrial order (2006). Greek Official Gazette 566/ 08.05.2006]
“Certification of Professional Profiles”, Athens
Roelants B., (2002). Rozszerzenie ekonomii społecznej; dokument przygotowawczy
na I Europejską Konferencję Ekonomii Społecznej w Europie Środkowo-
Wschodniej, CECOP, Praga 2002, s. 28
€QUALIFISE Guidance for allocating a European Qualification Framework level and
learning category weighting to a qualification – V4 – last updated 30/09/08
Typology of Knowledge, Skills and Competences, CEDEFOP Reference Series; 64,
2009
Towards a European Qualifications Framework for Lifelong Learning, Commission of
the European Communities, Brussels, 8.7.2005
European Commission, (2007) importance of social economy enterprises. Accessed
on January 5th 2009, available at http://ec.europa.eu/
Austrian Institute for SME Research and TSE Entre, Turku School of Economics,
(2007). Study on Practices and Policies in the Social Enterprise Sector in
Europe, Vienna. Accessed on January 5th 2009, available
http://ec.europa.eu/enterprise/entrepreneurship
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Fowles, J. (1978). Handbook of Futures Research. Westport: Greenwood Press

Halas, G. (2002). Analysis of Labor. Guide of Support for the design of educational
programmes for education based on performance capabilities. Centre for the
Development of Vocational Training/Greek General Confederation of Labor:
Series Education, Training, Essays.
EKEPIS, (2007). Guide for the Development of Professional Profiles, Athens

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AA023
Predicting cost of prefabricated housing using neural networks

Mladen Vukomanović
(Research Assistant, University of Zagreb, Zagreb, Croatia)

Mirsad Kararić
(CEO, Libra Projekt, Ltd., Zagreb, Croatia)

Mladen Radujković
(Professor, University of Zagreb, Faculty of Civil Engineering, Zagreb, Croatia)

Abstract
Political and economic pressures have become an aggravating circumstance for
construction companies in achieving basic project management criteria, i.e. cost,
time and scope. The construction's low performance only stresses out the need for
improving current practices - especially in regard to cost. Therefore, we sought to
find a critical set of variables for predicting total cost of prefabricated housing. We
applied neural networks on data from more than 30 projects and thus have identify
17 critical variables for the cost prediction. The model was verified on 28 buildings
with following performances: 85.7% of predicted values had the deviation lower
5%, while 10.7% had the deviation lower than 10%, in relation to the actual cost.
After validating the model on data from 3 buildings, that had been new to the
network, the performances were as follows: 83.8% of predicted values had the
deviation lower 5%, while 12.9% had the deviation lower than 10%. Therefore this
model showed to be very robust. Furthermore, this study has also demonstrated a
more efficient and effective way of predicting total cost of building. Thus
construction companies can influence project performance during project early
phases, and acquire more competitive position on the market. Conclusion brings
guidelines for use of the model and gives recommendation for its further
development.

Keywords
prefabricated housing, prediction, cost, neural networks, model, construction

1. Introduction

Construction industry has a poor project management performance, especially in

relation to achieving cost objectives (Al-Jibouri, 2003, Atkinson, 1999, Costa et al.,
2004, Roztocki and Weistroffer, 2005). Therefore, construction companies have to
be more accurate in predicting total cost of building, still during the tendering
phase. Nowadays only 34% of projects make it on the time, within the budget and
in accordance with the agreed scope (Vukomanović et al., 2008, Standish-group,
2009). Because of this bad performance the construction has been proclaimed the
worst, inefficient, plundering etc (Beatham et al., 2005, Beatham et al., 2004).
Neural networks (NN) are a form of artificial intelligence which tries to simulate
behavior of human’s brain. The first model was published in 1943 by McCulloch and
Pitts (McCulloch and Pitts, 1943), where the authors analyzed fundamental logic
functions. Besides the founders; Hebb (1949), Lashley (1951), Minsky (1988) and
many others served as the catalyst of change and as promoters of NNs. After initial
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

fame, up to 1980s and the IT dawn, NN were developing in a slower pace,

considering only smaller improvement (Rumelhart and McClelland, 1982, Werbos,
1994, Kohonen, 1988). Rapid development of IT stimulated further development of
NN, as well.

Nowadays, NN can be also found in researches in area of construction

management. E.g., Chua et al. (Chua et al., 1997) studied the influence of critical
success factors on planned construction cost. Ling et al. (2004) defined a set of
indicators that can predict project performance in Design & Build projects. They
found strong correlation among 65 success factors and 11 criteria of project
success. Odeh et al. (2002) studied a set of indicators in correlation with project
time, in traditional, construction management procurement routes. Kog et al. (Kog
et al., 1999) designed a model using NN in predicting the deviation [%] of project
time. Iyer et al. (2005) and Iyer and Jha (2006) analyzed more than 1500 projects
in India and found reliable set of factors for prediction of cost in traditional building
projects. NN can be also found in many areas besides construction, e.g.: finance,
ICT, medicine, transport etc, as well.

While competitive pressures are forcing construction contractors companies to

produce numerous bids every day, investors (sponsors) do not have any obligation
to even consider them. This huge gap between realized and unrealized bids has
unfortunately become a common practice, especially in prefabricated housing. This
only indicates low ability of the companies in calculating the final cost. Therefore we
sought to find a solution to this problem using NN approach.

This paper elaborates the

Selecting variables Preliminary set potential of NN on prefabricated
housing. It examines and
Analysing the Defining inputs and identifies variables for predicting
database outputs
NEURAL NETWORK PROCESSING

final cost of building. It proposes

Designing the a NN model for cost prediction,
The problem network
which companies can, during
early project phases; use to
Learning
If verification
calculate relatively accurate
was not estimate of total cost of building
satisfactory
Verification and thus save scarce resources.
The research starts with
If validation was
not satisfactory hypothesis that: The final cost of
Validation
Final model prefabricated housing can be,
If validation was
satisfactory within reasonable limits,
predicted using Neural Networks
on a critical set of factors.
Fig 1: The NN methodology

2. Methodology

The methodology of this research is presented on Figure 1. After we had identified

the problem, we started to analyze database of already finished prefabricated
housing projects (DB). The original DB included 35 indicators from 28 projects. The
initial selection of the indicators for NN was based on heuristics and experience of
the authors. We employed mean cost/m2 ratio as a filter for identifying outliers
from the set. From initial set, altogether three outliers were discarded.

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29-31 May 2010, Heraklion, Crete, Greece.

During verification of the model, we compared actual cost vs. predicted cost. The
performance of verification was evaluated using statistical indicators, i.e. R square
and standard deviation. If we had found that a variable had no influence on the
output, we removed it from the set. Moreover, if we had found a significant
deviation between actuals and predictions, the variable was also removed from the
set. After 12 iterations, the initial set of 32 variables was reduced to 17 successfully
verified variables. We validated the set on new data (three new projects), that
model had not seen before. The validation performance was used to test the
hypothesis. We set validation treshold at 5% of deviation between predicted and
actual values.

3. Application of NN on the problem

3.1. The identification of variables

Variables were filtered in NN in regard to two crucial criteria: a) influence of a

variable on the final outcome and b) interrelation among variables. Variables had to
be at the same time specific and easily calculated, so that companies could swiftly
come up with accurate predictions. Otherwise, the concept becomes only a
redundancy to procurement process. Table 1 shows the final, verified and validated
set of 17 variables.

Variable Definition Values

Outer wall – quality of outer wall is defined by different
quality levels, in regard to different building materials,
Out.wall 1-3
thermodynamic properties etc. In accordance with
Croatian market we defined three levels of quality.
Ceiling. Two levels of quality: with visible beams and
Ceil 1-2
without visible beams.
Floor Floor. Two levels of quality dependant of floor covering. 1-2
Staircase. Two types of staircases, dependent of building
Stair 1-2
material.
Carpentry. Three levels of quality, dependant of different
Carp 1-3
material, i.e. wood, aluminum/wood or PVC.
Electrical installation - Two levels of quality in regard to
Elec 1-2
price levels.
Central heating - Two levels of quality in regard to price
Cen.heat 1-2
levels.
Plumbing and sanitation - Two levels of quality in regard
P&S 1-2
to price levels.
Net area. The area was calculated without any correction
Fnetto numeric
factors in regard to attic.
Ratio between the net and gross area. The gross area
NB numeric
was calculated as area in between outer walls.
Ratio between area of windows and total length of outer
Win numeric
walls
Ratio of area of area of gallery against gross area of the
attic. The gallery is defined as a part of the ceiling where
Attic numeric
no ceiling was built. Gallery area did not involve the area
of the stairs.
Roof Ratio of roof area against orthogonal area of the roof. numeric
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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Ratio between the height of ceiling wall and the height of

Wall numeric
one floor (2.65 m).
The ration between total lengths of the roof on
Gable longitudinal side against total length of the roof on the numeric
gable.
The ratio of ground floor ceiling area against 1st floor
Ceil.fl numeric
ceiling area.
The ratio of gross area of covered terrace against ratio of
Terrace numeric
the total gross area.
Table 1: The final set of variables for the cost prediction

Table 1 also shows two types of variables; ones with preset quality levels and ones
with numerical values that have to be calculated in regard to the building’s
architecture. Thus, the ones with predefined intervals [1-3] or [1-2] (e.g. V.ZID)
were predetermined and dependant of market conditions, and the ones with
numeric variables had to be calculated in regard to building dimensions (e.g. house
net area, ratio of roof area against orthogonal area of the roof, etc).

3.2. The network design and the learning procedure

After the initial outlier filtering, the set of 32 indicators was subjected to NN
training in Neuro Shell 2 application (Release 4.0., Ward System Group, Inc). Table
2 shows input and output data for Nero Shell 2. Values of 0.000 were replaced with
0.001 (see table 2, e.g. OBJ 16), since otherwise NN would not recognized the
input and would considered it as missing data. The data was trained on different NN
architectures, different training modes and different termination criteria. The design
phase also considered different numbers of neurons in order to find an optimal
solution. In total, we ran over 20 different architectures and came with the final set
consisting of 17 indicators (see table 1). We have found that the most effective
network was 3 Layer Backprop with Jump Connections, from the group of
recommended classification net.

3.3. Verification of the model

The network’s effectiveness depends on duration of training. Too much training

would give the best results for current data, but would not perform as good on new
data. Therefore, a good verification performance does not indicate a good validation
performance, as well. Table 3 shows unfavorable (Output Layer Dampened
Feedback Link NN architecture) and favorable (3 Layer Backprop with Jump
Connections NN architecture) performances from verification phase.

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“Concepts, Tools & Techniques for Managing Successful Projects”
29-31 May 2010, Heraklion, Crete, Greece.

Out.w Floo Ele Cen.he P& Fnett Terra Total cost

all Ceil r Stair Carp c at S o NB Win Attic Roof Wall Gable Ceil.fl ce

OBJ 1 3 1 2 2 2 2 2 2 135.8 0.847 0.4 0.007 1.27 0.275 0.51 0.58 0.001 701.499.
OBJ 2 1 2 1 1 1 1 1 1 149.8 0.849 0.4 0.048 1.33 0.132 0.56 0.49 0.04 558.809.
OBJ 3 2 1 1 1 1 1 1 1 162.9 0.825 0.3 0.029 1.28 0.377 0.89 0.52 0.03 607.838.
OBJ 4 3 2 2 2 3 2 2 2 154.9 0.853 0.2 0.001 1.32 0.128 0.56 0.52 0.001 741.073.
OBJ 5 2 1 1 1 2 1 2 1 198.3 0.862 0.2 0.048 1.08 0.490 0.85 0.36 0.04 689.093.
OBJ 6 1 2 1 1 1 1 1 1 108.4 0.822 0.3 0.001 1.39 0.369 0.76 0.55 0.001 463.718.
OBJ 7 3 2 2 2 2 2 2 2 189.8 0.856 0.3 0.001 1.37 0.286 0.99 0.52 0.001 828.784.
OBJ 8 2 1 1 1 1 1 1 1 140.7 0.844 0.2 0.053 1.27 0.098 0.83 0.37 0.08 512.498.
OBJ 9 1 1 1 1 1 1 1 1 154.6 0.852 0.4 0.001 1.22 0.569 0.87 0.52 0.001 556.143.
OBJ 10 2 2 2 2 2 1 1 2 181.3 0.853 0.5 0.044 1.32 0.301 0.64 0.56 0.03 766.131.
OBJ 11 3 1 2 2 3 2 2 2 132.6 0.842 0.2 0.001 1.41 0.169 0.75 0.49 0.13 686.075.
OBJ 12 2 2 1 1 1 1 1 1 141.8 0.823 0.3 0.057 1.26 0.113 0.84 0.35 0.06 528.189.
OBJ 13 1 1 1 1 1 1 2 1 245.9 0.878 0.4 0.047 1.13 0.754 0.86 0.76 0.03 815.195.
OBJ 14 3 1 2 2 2 2 2 2 209.7 0.854 0.3 0.001 1.22 0.452 1.29 0.64 0.05 933.829.
OBJ 15 2 1 1 1 1 1 1 1 131.3 0.837 0.2 0.001 1.31 0.128 0.52 0.52 0.02 513.529.
OBJ 16 1 0.00 1 0.00 1 1 1 1 103.8 0.867 0.2 0.001 1.15 0.001 0.001 0.001 0.12 405.594.
OBJ 17 2 0.00 1 0.00 2 1 1 1 123.8 0.872 0.6 0.001 1.15 0.001 0.001 0.001 0.08 478.294.
OBJ 18 1 0.00 1 0.00 1 1 1 1 56.55 0.826 0.2 0.001 1.1 0.001 0.001 0.001 0.001 271.332.
OBJ 19 2 0.00 2 0.00 2 1 2 1 93.82 0.856 0.3 0.001 1.18 0.001 0.001 0.001 0.07 456.011.
OBJ 20 3 0.00 2 0.00 3 2 2 2 140.0 0.865 0.3 0.001 1.15 0.001 0.001 0.001 0.17 687.015.
OBJ 21 1 0.00 1 0.00 1 1 1 1 93.13 0.861 0.2 0.001 1.23 0.001 0.001 0.001 0.04 361.531.
OBJ 22 3 0.00 2 0.00 3 2 2 2 139.1 0.865 0.4 0.001 1.15 0.001 0.001 0.001 0.06 666.780.
OBJ 23 2 0.00 2 0.00 2 2 1 2 123.7 0.867 0.1 0.001 1.16 0.001 0.001 0.001 0.13 549.856.
OBJ 24 1 0.00 1 0.00 1 1 1 1 134.9 0.880 0.6 0.001 1.18 0.001 0.001 0.001 0.03 491.374.
OBJ 25 3 0.00 2 0.00 2 2 2 2 104.6 0.860 0.3 0.001 1.15 0.001 0.001 0.001 0.001 544.925.
OBJ 26 2 0.00 2 0.00 3 2 2 2 135.5 0.861 0.4 0.001 1.18 0.001 0.001 0.001 0.06 671.687.
OBJ 27 3 0.00 2 0.00 2 2 2 2 121.6 0.865 0.5 0.001 1.15 0.001 0.001 0.001 0.04 619.887.
OBJ 28 1 0.00 1 0.00 1 1 1 1 115.4 0.862 0.3 0.001 1.08 0.001 0.001 0.001 0.07 443.711.
Table 2: Overview of the input data for the NN model

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statistics unfavorable values favorable values

2
R 0.9373 0.9809
r2 0.9375 0.9824
Square mean arror 1391.588 422.622
Absolute mean error 28.381 12.827
Min. mean error 0.348 0.432
Max mean error 80.446 61.837
Correlation (r) 0.9682 0.9912
percentage under 5% 60.714 85.714
percentage between 5% and 10% 25.000 10.714
percentage between 10% and 20% 10.714 3.571
percentage between 29% and 30% 3.571 0
percentage over 30% 0 0
Table 3: The comparison of favorable and unfavorable values in the verification
phase

3.4. Validation of the model

Validation of the network was conducted on three new objects, where each one had
different characteristics.

Actual cost Predicted cost deviation %

(NN)
556.7750244 560.5253296 -3.750305176 -0.67
450. 618988 429.5108948 21.10809326 4.68
731.3359985 778.3654175 -47.02941895 -6. 43
Table 4: Comparison of actual vs. predicted values during the validation

Table 4 shows deviation between predicted and actual total cost. The validation
showed that the NN model performed within preset boundaries (5%). Therefore,
the mean deviation of 4.13% was accepted as final.

Output verification validation

2
R 0.9809 0.9781
r2 0.9824 0.9783
Square mean arror 422.622 467.896
Absolute mean error 12.827 13.905
Min. mean error 0.432 0.432
Max mean error 61.837 61.837
Correlation (r) 0.9912 0.9891
percentage under 5% 85.714 83.871
percentage between 5% and 10% 10.714 12.903
percentage between 10% and 20% 3.571 3.226
percentage between 29% and 30% 0 0
percentage over 30% 0 0
Table 5: Comparison of the verification and the validation performances

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Another interesting fact was that the verification and the validation performances
differed only in smaller amounts (0.9809 and 0.9781, respectively) which show
model’s robustness. Therefore, we concluded that the network stable and trained
enough.

4. The discussion: analysis of results and the use of the model

This paper has demonstrated that by using a set of critical set of variables
construction companies can, in very short time, predict the total cost of
prefabricated buildings and thus save huge amount of energy. The final set of
factors is consistent of 17 variables, which are: Out.wall, Ceil, Floor, Stair, Carp,
Elec, Cen.heat, P&S, Fnetto, NB, Win, Attic, Roof, Wall, Gable, Ceil.fl, Terrace.
Definition of the variables is given in table 2.

The model was validated with satisfactory validation performance: the minimum
deviation of predicted from actual values was on 0.67%, the mean deviation on
4.13% and the maximum deviation on 6.43%. Therefore, the hypothesis: The final
cost of prefabricated housing can be, within reasonable limits, predicted using
Neural Networks on a critical set of factors was tested and accepted. Since the
model becomes more and more robust as the database grows (Chua et al., 1997,
Ling and Liu, 2004, Iyer and Jha, 2006) construction companies should use the set
of variables and try to fill it with new data whenever a new project is realized.

Besides NN, we had considered other methods, as well (E.g. linear regression,
nonlinear regression and stepwise regression). In all our attempts we could not find
as efficient models as NN are, which was especially evident when introducing or
replacing new variables to the model. Practical value of this research can be found
in possibility to effectively respond to client requests, while consuming as little
resources as possible.

5. Limitations regarding different types of houses

In order to compare this study with simmilar ones, first, some limitations have to
be acknowledged. Prefabricated housing, in this research, was considered as
facilities with prefabricated wooden bearing structure - panel type. The total cost of
building was considered as for the turn key projects, i.e. the cost of fully completed
and totally functional buildings. The cost also considered all of the craft work, e.g.
pluming, HVAC etc. The final cost did not comprehend: the cost of design,
consulting fee, cost of land and infrastructure etc. The profit margin of 10 % was
also included in the final cost. Furthermore, the model was designed only for
family-type houses and not for other kind of facilities. All family houses were limited
on to one and two floor buildings with the hight of one floor at 2.65 m.

6. Conclusion

This research has showed that companies can predict total cost of prefabricated
housing in a relatively accurate and efficient way. This model will help construction
companies in dealing with current market pressures and responding to market
needs. Construction management discipline has obviously other tricks up its sleeve
than traditionally accepted methods and companies should finally start to use them.

In further research some limitations have to be abandoned: e.g. the model has to
be developed for facilities other than residential, the model should also consider
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29-31 May 2010, Heraklion, Crete, Greece.

other than 1 floor houses. The model should also introduce administrative costs and
other financial variables (i.e. net present value, return of investment etc.), as well.
The model should be expanded on to traditional type buildings (brick, concrete etc.)
as well, especially since its trend in Croatia. Finally, it would be very interesting to
apply factor analysis on original 35 variables and try to compare the results with
this set of critical variables.

7. References

Al-Jibouri, S. (2003), "Monitoring systems and their effectiveness for project cost control in
construction", International Journal of Project Management, 21, 145-154.
Atkinson, R. (1999), "Project management: cost, time and quality, two best guesses and a
phenomenon, its time to accept other success criteria", International Journal of Project
Management, 17, 337-342.
Beatham, S., Anumba, C., Thorpe, T. & Hedges, I. (2004), "KPIs: a critical appraisal of their
use in construction", Benchmarking: An International Journal, 11, 93-117.
Beatham, S., Anumba, C., Thorpe, T. & Hedges, I. (2005), "An integrated business
improvement system (IBIS) for construction", Measuring Business Excellence, 9, 42-55.
Chua, D., Loh, P., Kog, Y. & Jaselskis, E. (1997), "Neural Networks for Construction Project
Success", Expert Systems With Applications, 13, 317-328.
Costa, D., Formoso, C., Kagioglou, M. & Alarcón, L. (2004) Performance Measurement
Systems for Benchmarking in the Construction Industry.
Hebb, D. (1949), " The organization of behavior", A neuropsychological theory. New York.
Iyer, K. & Jha, K. (2005), "Factors affecting cost performance: evidence from Indian
construction projects", International Journal of Project Management, 23, 283-295.
Iyer, K. & Jha, K. (2006), "Critical factors affecting schedule performance: evidence from
Indian construction projects", Journal of Construction Engineering and Management,
132, 871.
Kog, Y., Chua, D., Loh, P. & Jaselskis, E. (1999), "Key determinants for construction
schedule performance", International Journal of Project Management, 17, 351-359.
Kohonen, T. (1988), "Self-organization and associative memory".
Lashley, K. & Jeffress, L. (1951), "Cerebral mechanisms in behavior", The problem of serial
order in behavior, 112-136.
Ling, F. & Liu, M. (2004), "Using neural network to predict performance of design-build
projects in Singapore", Building and Environment, 39, 1263-1274.
McCulloch, W. & Pitts, W. (1943), "A logical calculus of the ideas immanent in nervous
activity", Bulletin of Mathematical Biology, 5, 115-133.
Minsky, M. & Papert, S. (1988), Perceptrons: An introduction to computational geometry,
MIT press Cambridge, MA.
Odeh, A. & Battaineh, H. (2002), "Causes of construction delay: traditional contracts",
International Journal of Project Management, 20, 67-73.
Roztocki, N. & Weistroffer, H. (2005), "Evaluating Information technology investments in
emerging economies using activity based costing", Electronic Journal of Information
Systems in Developing countries, 19, 1-6.
Rumelhart, D. & McClelland, J. (1982), "An interactive activation model of context effects in
letter perception: Part 2. The contextual enhancement effect and some tests and
extensions of the model", Psychological review, 89, 60-94.
Standish-group (2009) Chaos report 2009. Standish group.
Vukomanović, M., Radujković, M. & Burcar Dunović, I. (2008), "Performance management
models in construction companies", Gradevinar, 60, 771-778.
Werbos, P. (1994), The roots of backpropagation: from ordered derivatives to neural
networks and political forecasting, Wiley-Interscience.

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29-31 May 2010, Heraklion, Crete, Greece.

AA100

Informal projects management with volunteers participation

Marek Wirkus
(Profesor, Faculty of Manag. & Economics, Gdansk University of Techology, Poland)

Abstract
This article presents the results research conducted to identify key elements
influencing the success of projects managed in informal way with volunteer
participation. The data was collected from several “soft” projects. These projects
included organisation of sporting, cultural, and charity events targeting large
groups of people. The research involved discussing the following areas:
 roles and activities of volunteers,
 rules for employing volunteers ,
 factors influencing the success of the projects including:
o the trust as the base of informal projects management,
o intra-project communication,
o cooperation
o team work.
Project risk, reporting, execution control, and the role of project culture as
elements influenced on project success were discussed.

Keywords
Project management, volunteers in project.

1. Introduction

Volunteers are commonly and globally engaged in "soft" projects in the economic
world. The primary reason for engaging volunteers is that they are offer their time
and skills for free. Projects with volunteers are generally managed using the same
rules that are used for managing "normal" projects. Looking at these projects, we
should realize that volunteers are working without payment, have no legal
agreement with project management, and are not available full time. Therefore we
should pay attention to the specific character of management and execution of
these projects. Management of these projects is often done in an informal way
rather than by employing any well-known methodologies described in literature.
Management of these projects is based on common sense, learning through
experience, and the intuition of people who execute them. In this article I have
tried to identify the key factors having influence on the success of soft projects
involving volunteers.

2. Volunteers and reasons for hiring them in projects

The foundations of volunteer work are free-will, unpaid, conscious, and exceeding
family relationships (and relationships between neighbors) work for others. Anyone
can be a volunteer. You are a volunteer if you want to work for others without pay,
just because of free-will. (www.wolontariat.org.pl; 2010). People give different
reasons for working as volunteers and different expectations about working in this
kind of projects. Here are the most common reasons:
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29-31 May 2010, Heraklion, Crete, Greece.

 improving skills and gaining practical experience, which will increase their
value in the employee market,
 new experiences,
 attractive project topic ,
 on-material benefits connected with attending this project - for example
chance to attend an interesting concert,
 self-testing,
 making life more attractive, having new adventures,
 moral duty.

Project executives hire volunteers, because they work for free (we should realize
that in some projects low budgets limit the ability to hire full time employees).
Volunteers are usually needed for a short time, during specific periods and for
specific tasks of a project. Looking at these aspects we can see that volunteers
provide flexibility in this area. Volunteers usually support projects run by non-profit
organizations, for example:
 non-government organizations, foundations,
 local associations of local government agencies,
 churches
 entities under public administration and supervised by the municipality.
The number of these projects is really large, but they are undervalued by project
management methodology.

Detailed research was conducted on eight projects. Quality research was done by
interviewing project managers and volunteers working in these projects. Research
was done for the following projects:
a) organizing a musical concert for about 110 000 people,
b) preparing huge sport event with on-street marathon for about 550 runners,
c) charity event - collecting food and preparing a welfare holiday meals for
1200 persons,
d) organizing the Tall Ships’ Race,
e) wedding party for about 150 guests.
The owners of all these projects said that their projects were successful. Some of
these opinions were confirmed by media reports, but not all for them had an
objective success indicator. The concert was given at the planned time, the charity
event took place and so on. Projects did not exceed their planed budgets, but no
one assed the satisfaction of people attending these events. Here is a short
characteristic of these projects:
 "Soft" projects, in different areas, where results of project are not material,
so it is hard to identify and measure effect of the project.
 The length of the projects is diverse: from a few months (charity event) to a
few years (Tall Ships’ Race). We can observe that there is increased effort
connected with the delivery final product (concert, sports event and so one)
at the end of the project.
 Project are executed under time pressure (for example it is not possible to
change concert data.
 High complexity.
 Public scrutiny of these projects through media, and opinions that could not
be ignored (but in some cases the media did not have enough data to form
the correct opinion).
Volunteers were an important part of all this projects. All these projects were
managed in a non-formal way, without using any project management

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methodology. Managers used their intuition. Based on these projects we can

postulate the following characteristics:
 Poor documentation on the management (tracking, controlling) and results of
the project (low level of "paper work").
 most communication was done in through individual, informal, face to face
meetings,
 decision making was neither formalized nor documented (no reasons given)
 budget was low and not specific

The organizational structure of all these projects was simple. Here are most
important components of this structure:
 project manager - played a key role and was supported by an organizational
office consisting of several persons,
 specialized subcontractors,
 groups of volunteers.

In some projects (e.g. the wedding party, Tall Ships’ Race), but not all (e.g.
concert) the number of volunteers was significantly higher than the number of
employees. In all projects number of people needed for different phases of the
project changed dynamically.

All projects were managed by organizations with poor awareness of project

management methodology. Project managers were not certified in project
management. Their knowledge in this area was fragmentary, and came from
personal experience, not professional trainings. On the other hand, project
managers had great knowledge about the subject matter from previous experience.
Project Managers was nominated as PMs because of this.

Based on observation of these people and the assessment of their skills we can
indicate some key characteristics of people who should be involved in managing
huge projects (or people who are should manage major work packages of such
projects):
a) the project manager should be a full time employee, chosen based on skills
not on position,
b) leadership skills, ability to work with people, open, with good interpersonal
skills, people who can build trust relationships,
c) enthusiastic, with ability to motivate other people, giving enthusiasm to other
people (volunteers),
d) well motivated, and goal-focused,
e) possessing skills in human resource management.

You should pay attention on choosing people for project management, especial if
you want to nominate volunteer as a project manager. If you are choosing a
volunteer as a project manager, you should be 100% sure if this person will attend
this project until the end. If this person will resign before the project ends you will
experience an "information gap" and this will have great impact on the success of
the project.

3. Rules for recruiting and hiring volunteers

There was no problem in finding people who have the qualifications and understand
the general purpose of project. Volunteers were recruited through press and on-line
advertisements. Some of advertisements were focused on special groups of people.
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For example there were advertisements focused on students interested in sailing

(Tall Ships’ Race) and sports (sport event). Advertisements contained slogans like
"great satisfaction guaranteed". Many volunteers were recruited through personal
connections of people employed in the organization and contacts of already
recruited volunteers.

People were engaged basing on oral declarations of candidates. People were

declaring that they:
 would attend to the project,
 donate their free time,
 have the required education and overall skills (in some cases people were
asked to prove their skills - for example show medical certificates).
In very attractive projects (e.g. concerts, Tall Ships’ Race) which attracted many
candidates, there was a preference for people with experience in similar projects.

It is necessary to pay attention to the interview, which was not always appreciated
by managed (because of lack of time). Skills, experience and abilities were not
dependent on the age of volunteers. It is important to asses all skills, to choose
appropriate people, who will bring value to project, but this should be two-way
relation - volunteers should be satisfied from taking part in your project. Usually
the interview was the only tool to verify the skills of all volunteers. What is more
interesting - in most cases all declarations were true. In most cases declared skills
were followed by real, high scored, work. Of course some lack of experiences could
be fixed by training. But analyzing trainings delivered during the project we can say
that most were delivered as a short overview, rather than detailed training.

There was no formal agreement between volunteer and organization preparing the
event. Volunteers did not ask for such agreements17 but it is important how the
volunteers enter the project. Volunteers should:
 be engaged at the right time, he or she should have enough time to
understand tasks he had to do an to "feel the project",
 be assigned to the right person, who is managing project (or some aspects of
project) and is a contact person, working as a mentor for a volunteer.

4. Roles, rules and rights of volunteers

In the analyzed projects, volunteers performed the following tasks:

 non-complex without any prerequisite skills,
 routine, repeatable tasks,
 some tasks requiring additional skills: driving, fluency in languages, first aid.

Some examples of work done by volunteers includes:

 manning information booths,
 handing out brochures,
 technical assistance, office work,
 animate events accompanying the main event,
 support for the main event (e.g. collecting food for the charity event),
 taking care for spectators, artists, sportsman or VIP,
 providing first aid.

17
According to law in some countries it is necessary to sign agreement if volunteers are working in project for more
than 30 days
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Volunteers were obligated to the following:

• be punctual,
• work in uniforms provided by the organizer,
• attend meetings with management.

To do their jobs correctly, volunteers had to find information about what is

happening in project (where and when) and what changes had occurred. They
needed to know who was responsible for the different areas and been able to
contact this person. Volunteers hired for projects had some rights stemming from
oral agreements or local law. Because volunteers should not pay any costs
associated with helping out, managers were responsible for providing a budget to
cover the necessary expenses. For example all volunteers had to be insured against
accidents, provided with meals during working hours and so on. This was an
additional cost of the project. Other costs included:
 business trips,
 sundries and uniforms,
 phone, internet costs etc.
In some cases volunteers were covered small costs from their own pocket (e.g. in
the charity event).

Assignments were handed out verbally during meetings with managers responsible
for appropriate aspects of the projects. The following aspects were specified during
meeting:
 setting scope of tasks,
 giving instructions on performing the tasks,
 setting rules for contact in the future.
After delegating tasks to volunteers, they were responsible for these tasks. In some
cases formal responsibility was placed on the volunteers, but in most cases the
manager who delegated task, took formal responsibility for it. In a few rare
situation meeting minutes were written down.

5. Project planning issues

Task planning was the weakest side of projects that were analyzed. It was because
of the informal character of project - informal project management caused informal
scheduling. No official methods like Work Breakdown Structure and Gantt Chart
were used to plan tasks. Generally project managers were focused on milestones.
They estimated data for milestones as a reference data for other tasks.

Estimation of project duration was done using intuition and previous experience
with similar projects. Sharing experience with specialists in different aspects of
project was done only from time to time.

This informal scheduling was the source of missing tasks and wrong estimation of
effort needed to finish tasks (very often assumed work was smaller than real work).
This underestimation was bring to light in less inspected moments. Project
managers, using intuition predicted problems started tasks early (looking at the
finish data). However an early start caused lax discipline, because the perception
was of appropriate time.

One of the major problems was volunteer availability - they were not available full-
time. Their availability did not always match the project managers’ expectations. In

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some cases the declared availability did not match actual availability, due the
additional work or wrong estimation of time needed for normal, everyday activities.

Non-distinct planning caused peaks in work effort required. These peaks were very
high at the end of the project. Hiring additional volunteers and assigning new work
to available volunteers helped to reduce this problem, but in some cases
overloading caused the volunteers to reject the new tasks or were quit the project.
Lack of resources at the end of the projects affected the quality of tasks and results
of some task was not as good as it was expected.

6. Communication in informal projects

Good communication is key to efficient volunteer oriented-project execution. This

conclusion was made by most PMs after their first failures. They stated that main
reason for these failures was poor communication. After this conclusion owners of
subtasks were obligated to make sure that all volunteers have appropriate
information about duties, tasks, and the project. It was necessary to get
confirmation that volunteers understood all the information. The communications
applied not only to tasks and duties, but also to safety.

Over the course of a project, communication happened in the following ways:

a) informal, individual talks with volunteers - this was the primary form of
communication (even in projects with large number of people). In these talks
tasks were described in detail and deadlines were given. They were a great
opportunity to share and discuss experiences. It is important to say that this
kind of communication has some problems: they are not documented and it
takes a lot of time to communicate in this way. It is natural that volunteers
want to state their own opinion about the project and informal meetings take
longer than expected. The volunteers were honest and were not afraid to
state critical opinion (they were not afraid of losing a job).
b) two-way experience sharing between people on the same part of the
project. The reason for this meeting was sharing experience, opinions, and
socializing. Some people were recognized for doing a good job.
c) written, formal notes were created rarely. Written communication was very
often done using real-time communicators. In some cases (Tall Ships’ Race)
short instruction leaflets were provided to the volunteers.

7. Motivating volunteers

The reasons for which volunteers take part in projects were stated at the beginning
of this article. All the stated reasons can be trace back to self-motivation, which is
grounded in emotions and want to partake in something special. Satisfaction from
accomplishment is a primary goal for them.

Volunteers, like any other person, want and need to be stimulated to work more
effectively. Well motivated people have more enthusiasm for their job and are more
resistant to small failures. In the analyzed projects, managers forgot to motivate
the volunteers.

Volunteers, working for free, cannot be motivated by financial gains - so they

should be motivated in the different ways, to be well-engaged in projects. They can
be motivated in following ways (but not all this methods were fully used in all
projects):
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showing appreciation for volunteers for job well done (for example by praise
and thanks or other different kinds of verbal appreciation),
 internal prizes- for example in tickets ( e.g. concert tickets, party invitation).
 networking and socializing opportunities.
At the same time, it is difficult to use punishment as a way to stimulate volunteers.
It is almost impossible to use financial punishment or use legal consequences
against volunteers doing a poor job. In some cases negative motivation was used -
for example, people who did not do their job well did not receive concert tickets or
were moved to less prestigious tasks. Motivating people by verbal appreciation and
small punishments seems to be the best solution for motivating volunteers.

8. Risk and trust in projects with volunteers

Hiring volunteers raises some project risks (which should be managed with other
project risks) like - over-optimistic task duration estimation or lack of cost control.
Generally PMs did not perform a detailed risk analysis, especially for risks arising
from hiring volunteers.

It is possible to identify some typical risks which occur in these projects. Here are
some examples:
a) smaller than expected efficiency: wrong people are chosen and tasks are
assigned to people who do not have enough time or appropriate skills,
knowledge and experience,
b) volunteers quitting the project (sometimes without notifying management
about this) which can bring problems especially in peak work time.
Volunteers were quitting because of discouragement, which is caused by:
o more intensive and more difficult work than expected,
o lack of identification with project.
After identifying this risk they can be mitigated by hiring other volunteers with
better sense of responsibility or hiring more volunteers then it is necessary.
All problems with volunteers are connected to the recruitment process. Each
volunteer has a different personality, and declarations they gave at the interviews
were not always right. Sometimes they were over-valuing their skills. Looking at
the time restrictions it was not possible to perform good recruitment.

Trust plays a key role in cooperating with volunteers. Managers delegating task to
volunteers trusted them and hoped that they would do their jobs appropriately.
Management was more dependent on volunteers, than the other way around.

We can observe two different attitudes of management, all of them are based on
life experience of management (Grudzewski, M.W. and Hejduk, I.K. … (2009)):
a) full trust - some managers were assuming that people will do their jobs well.
Usually managers trusted well known people and people with references.
b) limited trust - in limited trust volunteers were regularly monitored. After
good results of monitoring limited trust was changed to full trust.

The best method for monitoring was Monitoring by Walking Around. This method
put stress on observing and talking with people (personal contact). During these
meetings it was possible to give feedback to volunteers, asses their work (motivate
people), give instructions, inform about changes, and so on.

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9. Summary

Soft projects like organizing concerts, sport events, charity event are not always
appreciated. Sometimes they appear to be less complicated and not so valuable as
building bridges or skyscrapers. Project managers of soft projects are not as
appreciated as PMs of a normal project, so in some cases it was difficult to hire
skilled managers. Informal methods of project management are used, because PMs
were not familiar with formal project management methodologies.

In soft projects volunteers were engaged to do some jobs. This brings benefits for
both sides. Volunteers are usually enthusiastic people working for free in selected
tasks. It could be hard (from a manager’s perspective) to hire volunteers for a
project. Sometimes they are not well-prepared and have poor skills (for the tasks
they are assigned). In some cases costs and problems generated by volunteers
outweigh the benefits they bring.

Key aspects which have influence on projects with volunteer participation are:

a) you should accept every volunteers who want to access the project. Skills of
this person should be assessed in an appropriate way.
b) trust plays a key role in this projects,
c) Monitoring by Walking Around is good solution for monitoring volunteers,
d) communications should be accurate clear and well organized
e) non-material motivation is important for people who are by default self-
motivated,
f) written communication should be done where necessary, especially in peak
time,
g) real availability should be periodically reassessed,
h) a project manager should be chosen based on skill, leadership, ability to
work with people, with good interpersonal skills, people
The above are guidelines for initiators and people executing projects with volunteer
participation. Using these guidelines will improve the chance for success. Also
Project management training should be considered for people leading these efforts.

10. References

Grudzewski, M.W. and Hejduk, I.K. and Sankowska, A. and Wantuchowicz, M.

(2009) „Zarządzanie zaufaniem w przedsiębiorstwie” (Trust Management in
Enterprises), Oficyna a Wolters Kluwer business, Warsaw
An ABC of volunteering (ww.wolontariat.org.pl;10. 03.2010)

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AA028
The Greek Legal Framework on Occupational Diseases in
Construction: Conformity to Risk Management Standard

Yiannis Xenidis
(Lecturer, Aristotle University, Thessaloniki, Greece)

Maria Anastasiou
(Civil Engineer, Kounna Bros. Enterprizes Ltd., Larnaca, Cyprus)

Socrates Maggos
(Student, Aristotle University, Thessaloniki, Greece)

Abstract
This paper investigates the conformity of the Greek legal framework on
occupational diseases in construction with the guidelines for application of risk
management as described in the Project Management Body of Knowledge, a
credible international standard. The aim of this research is to identify specific
provisions in the Greek legal framework that require further improvement towards
an effective risk management of occupational diseases. To achieve this goal, related
laws and presidential decrees are analysed and their provisions are associated –
based on content – to the appropriate risk management process. The identification
between the levels of compliance of legal provisions with the specifications
described in the standard is performed through comparative analysis. The results
reveal that the current Greek legal framework addresses the issue of risk
management for occupational diseases in an unsystematic and incomplete way. The
research identifies certain weaknesses and makes specific suggestions towards a
legal framework aligned with the respective international standard.

Keywords
Risk management, Occupational diseases, Construction, Health and Safety

1. Introduction

Occupational accidents and diseases (OAD) are of major concern in the construction
industry because of health and safety, financial and legal implications. While human
health must be the primary concern, the financial burden to social security systems
and the managerial cost of legal actions such as complaints or prosecutions must
not be neglected as well. Hämäläinen et al (2009) refer to estimations by the
International Labour Organization (ILO) that raise, globally, the total costs of
occupational accidents and work-related diseases up to 4% of the Gross National
Product (GNP). The ILO, at the same time, estimates that 160 million people are
suffering from occupational diseases globally (ILO Safety in Numbers (2003)). OAD
are, also, strongly connected to the competitiveness of national economies, where
the safer the occupational environment is, the more competitive is the respective
economy.

Despite the fact that all interested stakeholders, including governments and
industrial players, are well aware for many years of the negative impact that OAD
have on the societal and economic profile of a country, serious deficiencies still
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exist both in the recording and notification systems of OAD and in the strategies for
treatment and their implementation (Hämäläinen et al (2009)). Two striking
examples of such deficiencies are the lack of official data for OAD and the deficient
legal framework for safety and health issues. Unexpectedly enough, this is the case
for both developing countries and countries with established market economies
such as those forming the European Union (EU).

Another critical issue is that OAD prevention activities focus more on occupational
accidents than on occupational diseases (Hämäläinen et al (2009)). This is
reasonable considering that:
 The impact of occupational accidents to costs and human health and life are
more direct compared to the latent diseases.
 The investigation of the causes and the risk of exposure to occupational diseases
are harder and more complicated considering that a disease may be the
outcome of a combination of several factors (e.g. workload, working conditions,
etc).
 Any corrective measure against occupational accidents has a direct and
quantifiable impact, which is the reduction of the number of injuries and deaths.
On the contrary, any corrective measure against occupational diseases cannot
be evaluated in the short-term and its effectiveness is dependent on a large
number of parameters even out of the working environment.
As a result, it is inferred that the situation with regard to the management of
occupational diseases is rather vague, hence the requirement of further
investigation towards the improvement of safety and health in the working
environment.

2. Research Methodology

This paper presents the results of research work on the specific issue of conformity
of the Greek legal framework on occupational diseases in construction with the
guidelines for application of risk management. In the context of this research the
following law (L.) and presidential decrees (P.D.) were studied: L.1568/1985, P.D.
307/1986, P.D. 85/1991, P.D. 77/1993, P.D. 397/1994, P.D. 17/1996, P.D.
90/1999, P.D. 159/1999, P.D. 339/2001, P.D. 149/2006, P.D. 212/2006, and P.D.
162/2007. These documents constitute the framework for safety and health in work
and comply with the EU’s respective guidelines and directives.

The research focuses on the construction sector, which is one of the most critical in
terms of occupational diseases, worldwide. The European Labour Force Survey
conducted by the Eurostat in 2007 (Eurostat, Statistics in Focus (2009)) ranks the
construction sector as fourth across different sectors in terms of recorded work-
related health problems and third in terms of exposure to factors that adversely
affect physical health (Eurostat, Statistics in Focus (2009)). Given the significance
of the construction sector for all national economies the focus there is well-justified.

The investigation of the case of Greece is selected because it presents the following
interesting features:
1. It is a country member of the EU with an established market economy and a
legal framework for occupational safety and health that complies with the EU’s
respective legal provisions (directives).
2. It demonstrates relatively good results between the member states of the EU
with regard to work-related health problems based on the European Labour
Force Survey (2007) conducted by the Eurostat (Eurostat, Statistics in Focus
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(2009)). Table 1 demonstrates that the performance in Greece concerning

exposure to factors adversely affecting physical health and limitations and
resulting sick leaves due to work-related health problems is very close or less
than the average between both the EU-15 and the EU-27 in all cases except
from one (see Row 2).

EU-15 EU-27 GREECE

% of workers who experienced one or
7.5 8.6 6.6
more work-related health problems
% of workers with work-related health
problems who experienced limitations in 48.2 50.1 58.8
normal daily activities to some extent
% of workers with work-related health
problems who experienced limitations in 22.0 22.3 17.1
normal daily activities considerably
% of workers with work-related health
62.3 62.0 47.1
problems resulting in sick leave
% of workers with work-related health
problems resulting in sick leave for more 29.2 27.0 15.2
than a month
% of workers who are exposed to factors
41.0 40.7 41.4
affecting physical health

Table 1: Greece’s performance in safety and health issues compared to the

other member states in the European Union (Data source: Eurostat, Statistics in
Focus (2009))

3. It features a construction sector with a high contribution to the total number of

occupational accidents in the country. Based on data from the Greek Labour
Inspectorate the construction sector in Greece ranks second – behind the
Retail/Repair sector – in occupational accidents among 60 different sectors of
economic activity for the time period between 2005-2008. Although, there are
no specific data for occupational diseases, it is logical to assume that the sector
presents equally high numbers as in the case of occupational accidents.

The research focuses on occupational diseases caused by noise, exposure to

chemical factors and asbestos and musculoskeletal disorders. Based on data from
the European Labour Force Survey these factors have caused a 69.04% of the total
work-related health problems experienced by workers in the EU (Eurostat, Statistics
in Focus (2009)). All of these factors are met in the construction industry.

For each one of the occupational diseases mentioned above, the legal framework
was thoroughly examined in order to identify provisions that could be associated in
terms of content to one of the risk management processes as described in the
Project Management Body of Knowledge (PMBOK (2004)), a credible international
standard published by the Project Management Institute (PMI). These processes are
schematically presented in Figure 1.

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Risk
Management
Planning

Risk Risk Response

Identification Planning

Qualitative Risk Risk Monitoring

Analysis and Control

Quantitative
Risk Analysis

Figure 1: The risk management processes according to the PMBOK

The definition of each of the processes presented in Figure 1 is given below (PMBOK
(2004)):

 Risk Management Planning is the process where decision is made on the

approach of the planning and implementation of the risk management
processes.
 Risk Identification is the process where the risks that may affect the project are
determined and their characteristics are documented.
 Qualitative Risk Analysis is the process where risks are prioritized for
subsequent further analysis or action by assessing and combining their
probability of occurrence and impact.
 Quantitative Risk Analysis is the process where the effect of identified risks on
overall project objectives is numerically analyzed.
 Risk Response Planning is the process where options and actions are developed
to enhance opportunities, and to reduce threats to project objectives.
 Risk Monitoring and Control is the process where identified risks are tracked,
residual risks are monitored, new risks are identified, and risk response plans
are executed and their effectiveness throughout the project life cycle is
evaluated.

The aim of the research was to determine the conformity of the provisions in the
legal framework for occupational diseases with the risk management framework
and consequently suggest improvements that can ensure a more effective
treatment of the safety and health issues in construction. The results are presented
in the following section.

3. Results and Discussion

For the purpose of performing a comparative analysis between: a) the provisions of

the current legal framework in Greece for occupational diseases and b) the
provisions of the PMBOK, for the correct implementation of each one of the risk
management processes, the following features have been defined:

 Feature 1: Clear definition of the process.

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 Feature 2: List of specific tools and techniques to apply the process.

 Feature 3: Provision for the documentation of the process.
 Feature 4: Suggestion of templates for the documentation of the process.

These features have been defined to constitute an interface between the compared
items. Therefore, when considered in relation to the legal framework, these
features prove to summarize in a satisfactory way the several legal provisions that
relate to the risks under study. On the other hand, the same features when
considered in relation to the content of the risk management processes, they prove
to accurately present all the requirements for the proper application of these
processes based on the PMBOK standard. Therefore, the four defined features along
with a fifth one (Feature 5: List of identified consequences upon risk occurrence)
that applies only for the Risk Identification process are adequate for use in a
comparative analysis.

A four-grade scale was applied to assign to each feature an assessment, in terms of

the identified level of conformity between the legal framework and the risk
management framework. The grades of the scale were:

 No (N): Denotes no conformity at all.

 Limited (L): Denotes very small conformity.
 Partial (P): Denotes partial conformity.
 Yes (Y): Denotes full conformity.

Having defined the parameters to compare (i.e. features) and the grading scale for
the comparison, the content of each one of the legal documents that constitute the
framework for safety and health in work in Greece was studied and assessed by the
authors with regard to the conformity to the respective risk management process.
For example for the risk of exposure to noise, the P.D. 149/2006 (2006) indicates
that: “Employers are obliged to assess the level of exposure to noise focusing
especially on the kind and duration of the exposure, and the implications to health
and safety of the employees”. For the same risk, the P.D. 81/1991 (1991) provides
with specific equations for the quantitative assessment of the level of noise in the
working environment. Since no other provision is made for this risk in the legal
framework with regard to the Quantitative Risk Analysis Process, the latter is
evaluated as having full conformity only concerning the reference to specific tools
and techniques to apply the process (Feature 2). However, no other feature is
complying with the requirements of the PMBOK standard for the application of the
Quantitative Risk Analysis Process and therefore all other features are given the
grade “N”. All the specific results that were provided by the comparative analysis
are presented in Table 2. These results demonstrate the following interesting and
significant issues:

1. The “Risk management planning” process is not described at all in the legal
framework for all the risks under study. Considering the definition of this
particular process as given in Section 2, this lack of reference indicates the
unsystematic way of treating risks related to occupational diseases in Greece.

2. The risk of exposure to asbestos is the only case where the risk identification
process is described in the legal framework fully compliant to the risk
management standard. This is also the only case with full compliance between
the compared items in the total number of the risk management processes.

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3. There is a complete lack of suggestions of templates for the documentation of

the processes. With the sole exception of the risk identification process in the
case of the risk of exposure to asbestos all other cases do not refer to such
suggestions.

4. Qualitative risk analysis is not mentioned at all in the legal framework, with the
sole exception in the case of the risks of musculoskeletal diseases.

Risk of
Risk of Risk of
Risk of exposure
exposure musculoskel
Features exposure to
to etal
to noise chemical
asbestos diseases
factors
Feature 1 N N N N
PLANNI
MANAG
EMENT
RISK

Feature 2 N N N N
NG

Feature 3 N N N N
Feature 4 N N N N
Feature 1 N P Y N
IDENTIFI
CATION

Feature 2 N N Y L
RISK

Feature 3 Y N Y N
Feature 4 N N Y N
Feature 5 Y P Y P
Feature 1 N N N Y
QUALIT

ANALY
ATIVE
RISK

Feature 2 N N N N
SIS

Feature 3 N N N N
Feature 4 N N N N
Feature 1 N P N N
QUANT

E RISK
ITATIV

ANALY

Feature 2 Y P N N
SIS

Feature 3 N N N N
Feature 4 N N N N
Feature 1 N P N N
CONTR
ORING
MONIT
RISK

Feature 2 P Y Y P
AND

OL

Feature 3 N Y Y P
Feature 4 N N N N
Feature 1 N N N N
PLANNI
RESPO
RISK

Feature 2 Y Y Y N
NSE

NG

Feature 3 N N Y N
Feature 4 N N N N

Table 2: Results concerning the conformity of the Greek legal framework for
occupational diseases to the risk identification process, as described in the
PMBOK, for specific risks

These findings clearly indicate the great distance between the risk management
framework and the way of its application in Greece in the field of occupational
diseases. While, the intention of the legislator is, undoubtedly, to address the risk
management approach towards a reduction of occupational diseases, it is evident
that this incorporation is unsystematic, inconsistent and, eventually, poor. This
should mainly be attributed to the lack of knowledge on behalf of the legislators
over the proper processing of risk management as described in related standards.
It is obvious that the legislators are based on previous regulations, intuition, and

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common sense rather than a systematic and analytical process that could lead to a
structured and complete content of provisions.

A generic proposal for the improvement of the current state is to introduce in the
respective legislative process experts or at least knowledgeable persons on risk
management theory and practice. It is logical to assume that in the cases of
successful adaptation of the risk management framework to the legal framework
(e.g. the risk identification process for the risk of exposure to asbestos compared to
the same process for all other risks) the contribution of such experts was the
critical success factor. It is obvious that the contribution of risk management
experts in the legislative process will result to the appropriate addressing to the
legal framework of both the theoretical requirements and the best practices for risk
management.

Apart from the generic proposal, specific amendments to the legislative framework
can be suggested to improve the current situation. Two of them are:
1. Improvement of the P.D. 159/1999, which is the basic legal document that
governs safety and health issues. This improvement will be achieved by the
incorporation of new clauses (e.g. listing of proposed tools and techniques for
the application of each risk management process) and amendment of existing
ones (e.g. Article 2, Paragraph 6) with regard to: a) suggestions for tools and
techniques, definitions, and descriptions of content for each risk management
process.
2. Improvement of the P.D. 397/1994, which governs the issues of manual
handling of loads. This legal document is the sole that although valid has not
been updated to comply with the P.D. 159/1999. This improvement will be
achieved by the incorporation of new clauses (e.g. incorporation of the Manual
Handling Assessment Charts (MAC) method and Key Item Method (KIM) for the
quantification of risks related to musculoskeletal diseases) and amendment of
existing ones (e.g. Articles 1-4) with regard to: a) definitions, b) the field of
application, c) employers’ commitments, and d) the ergonomy of site.

4. Conclusions

This paper presents a research on the conformity of the Greek legal framework
concerning occupational diseases with the risk management framework as
described in the PMBOK (2004) standard. Through detailed analysis of the legal
documents and comparison with the requirements of the standard, it is evident that
there is only partial compliance between the two compared items. Although
obviously unintended, the legal framework fails to address systematically,
consistently, and fully the risk management approach as described in a universal
standard. Instead, it incorporates a risk management approach that is vague,
incomplete, and not persuasive to the interested stakeholders (i.e. workers,
employers, etc.). Considering the great impact of occupational diseases in the
economy and the society, it is imperative to update the existing legal framework by
incorporation of new provisions and modification of existing ones to properly
address the risk management processes and, eventually, treat risks of occupational
diseases in a more efficient way. Specific proposals such as those presented in the
discussion section of this paper may be studied and applied. A proper application of
the risk management framework to safety and health issues shall: a) increase
efficiency in production, b) improve competitiveness of the economy, c) reduce
costs for the social security systems, and, most important of all, d) ensure safety
and health for the workers in their working environment.
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5. References

Eurostat, Statistics in Focus (2009), “Population and social conditions”, Technical

report 63/2009, Eurostat.
Hämäläinen, P., Saarela, K.L. and Takala, J. (2009), “Global trend according to
estimated number of occupational accidents and fatal work-related diseases at
region and country level”, Journal of Safety Research, 40, 125-139.
International Labour Office (ILO) (2003), “Safety in Numbers”, Technical report
XXX/2003, International Labour Office, Geneva, Switzerland.
L.1568/1985 (1985), “Workers safety and health” In Greek, Gazette of the
Government, National Printing Office, Athens, Greece.
P.D. 162/2007 (2007), “Protection of health for workers exposed to certain
chemical factors during their work in accordance with the Directive 2003/10/EC”
In Greek, Gazette of the Government, National Printing Office, Athens, Greece.
P.D. 212/2006 (2006), “Protection of workers exposed to asbestos during their
work in accordance with the Directives 84/477/EC, 91/382/EC and 2003/18/EC”
In Greek, Gazette of the Government, National Printing Office, Athens, Greece.
P.D. 149/2006 (2006), “Minimum specifications for the safety and health of workers
exposed to risks due to natural causes (noise) in accordance with the Directive
2006/15/EC” In Greek, Gazette of the Government, National Printing Office,
Athens, Greece.
P.D. 339/2001 (2001), “Modification of the P.D. 307/1986” In Greek, Gazette of the
Government, National Printing Office, Athens, Greece.
P.D. 159/1999 (1999), “Modification of the P.D. 17/1996 and the P.D. 70a/1988” In
Greek, Gazette of the Government, National Printing Office, Athens, Greece.
P.D. 90/1999 (1999), “Determination of marginal and maximum values for
exposure of workers to certain chemical factors during their work” in
accordance with the Directives 91/322/EC and 96/94/EC” In Greek, Gazette of
the Government, National Printing Office, Athens, Greece.
P.D. 17/1996, (1996), “Measures for the improvement of safety and health of
workers during their work in accordance with the Directives 89/391/EC and
91/383/EC” In Greek, Gazette of the Government, National Printing Office,
Athens, Greece.
P.D. 397/1994 (1994), “Minimum specifications for the safety and health of workers
during manual handing of loads in accordance with the Directive 90/269/EC” In
Greek, Gazette of the Government, National Printing Office, Athens, Greece.
P.D. 77/1993 (1993), “Protection of workers from natural, chemical and biological
factors” In Greek, Gazette of the Government, National Printing Office, Athens,
Greece.
P.D. 85/1991 (1991), “Protection of workers from risks due to exposure to noise
during their work in accordance with the Directive 86/188/EC” In Greek,
Gazette of the Government, National Printing Office, Athens, Greece.
P.D. 307/1986 (1986), “Protection of health for workers exposed to certain
chemical factors during their work” In Greek, Gazette of the Government,
National Printing Office, Athens, Greece.
Project Management Institute (2004), A Guide to the Project Management Body of
Knowledge (PMBOK Guide), 3rd edition, Project Management Body of Knowledge
Inc., United States.

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AA030

The Development of a Robust Resource Constrained Project

Scheduling Framework

Qaolin Yuan
(Research Fellow, University of Manchester, Manchester, UK)

Yiannis E. Polychronakis
(Senior Lecturer, University of Salford, Manchester, UK)

Abstract
The literature on resource constrained project scheduling attempts to schedule
projects with deterministic activity durations subject to various objective functions
and possible additional assumptions. During project execution, however, a project
may be subject to considerable uncertainty. Such uncertainty may lead to the
actual realized activity durations to substantially deviate from the durations that
were initially estimated in the baseline schedule and cause a serious project
overdue. This paper offers a framework that deals with the project scheduling
problem from the start of a project through to the finish, and therefore provides a
whole robust project scheduling strategy which is more tolerant to various
uncertainties. Our framework combines the buffer sizing technique, proactive
project scheduling approach and reactive project scheduling approach, which are
usually implemented at different stages of a given project. The proposed scheduling
framework constructed based on these approaches is tested using a large
experimental design in order to detect the effectiveness of each procedure.

Keywords
Project Scheduling, buffer sizing technique, proactive/reactive project scheduling

1. Introduction

All Project scheduling, as a stage of project planning in the field of project

management, has been shown to be an important factor to improve the success
rate of the project. It aims at deciding when to start and finish which activity in a
time order and optimal allocating resources to each project activity subject to
various constraints, such as resource limitations, activities durations and
ethnological precedence etc. This type of scheduling problem is known as Resource
Constrained Project Scheduling Problem (RSPCP).

The most common practice in project scheduling is to generate a schedule before

the start of the project that minimizes project duration with the assumption of
complete information under a static and deterministic environment. Such schedule
will then be served as the baseline schedule for the execution of the project.
However, during project execution, a project may be subject to considerable
uncertainty which stems from a number of internal and external sources, such as
project scope change, resources supply failure, original wrong estimation, etc. As a
result, the actually realized activity durations may deviate from the durations that
were initially estimated in the baseline schedule (Zhu et al., 2005). With a sensitive
schedule, once a disruption happens to one activity, it may pass on to its
successors till the end of project and leads to a serious project delay. Therefore,

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without any anticipation of variability, deterministic project scheduling is normally

not robust enough to be implemented in “real-life” projects.

Due to its practicality and assuming the recognition of unavoidable uncertainties

during project execution, the field of proactive project scheduling has been paid
much attention recently. The proactive project scheduling approach extends the
baseline schedule in order to absorb anticipated disruptions that may occur during
project execution. In simple terms it inserts buffer in front of each activity based on
the statistical knowledge of uncertainty (Van de Vonder et al., 2007).

The proactive scheduling is, arguably, practical and highly popular amongst
practitioners; due to complexities and unpredictable characteristics of “real life”
projects however it cannot guarantee that the project is fully protected against
delays. It is due to this fact that there is a constant need for contingency planning
that follows predictive scheduling. The purpose of that is to answer ‘what if’
question and continuously guide the project implementation through the
unavoidable schedule disruptions that occur.

The reactive project scheduling approach is used to modify the baseline schedule
when disruption occurs during project execution. The reactive scheduling action
may completely regenerate a new schedule or repair an existing schedule taking
into account the current state of the system (Wang 2005; Herrmann 2006; Van de
Vonder et al., 2007).

The combination of these two project scheduling approaches is known as proactive-

reactive project scheduling. Proactive scheduling approach is used to schedule a
project time plan before the start of the project, an approach which is widely
believed to be robust enough to absorb the expected disruptions; while reactive
scheduling approach is used to revise (or re-optimize) the baseline schedule during
the project execution particularly when disruptions occur that cannot be absorbed
by the proactive schedule. Researchers have suggested that the combination of
proactive project scheduling and reactive scheduling provides an effective and
efficient project scheduling strategy (Van de Vonder et al., 2007). Nevertheless,
one area that has not been given substantial consideration in previous scholarly
studies is that of fixed project deadlines i.e. where the project deadline is assumed
to be known and both the proactive and reactive approaches are calculated based
on that assumption. However, the estimate of the project final deadline that must
be decided at the early stages of the project has never been integrated into the
proactive-reactive project scheduling field even though this is arguably a crucial
input to the project time plan. If the project due time is overestimated the project
will be overprotected and lead to time and resources wasting. In contrast, if the
project due time is underestimated the project will still endure the risk of being
overdue even though the proactive-reactive scheduling strategy has been applied.
An appropriate buffer sizing technique needs to be applied to estimate the project
due time with both safety and economics considered before any project scheduling
approach can be calculated and implemented.

2. An alternative proposal

Arguably, the buffer sizing technique, proactive scheduling approach and reactive
approach could be combined together as a complete project scheduling strategy in
order to generate optimal and robust project schedules which should be able to
protect the project due date and at the same time avoid the unnecessary costs. The
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robust resource constrained project scheduling framework can be summarized as

follows:

Step 1. Predict the project duration using the buffer sizing technique:
After creating the project schedule using deterministic RCPSP approaches, the
project time buffer is decided using the buffer sizing technique and this buffer is
added to the project schedule in order to obtain a reasonable project duration.

Step 2. Construct the project baseline schedule using proactive project scheduling
approach:
Based on the deterministic project schedule and the project deadline that were
generated in Step 1, use proactive project scheduling approach to create the
project baseline schedule to absorb as much as possible the expected uncertainty.
Such baseline schedule will then be used to guide the project execution.

Step 3. Create a project contingency schedule using reactive project scheduling

approach:
When any unexpected disruptions occurred during the project execution, which
leads to the realized project activities to deviate from the baseline schedule
generated in Step 2, revise the project baseline using the reactive project
scheduling approach.

Such a project scheduling framework can be viewed as a feedback control process

as shown in Figure 1. A time control target needs to be specified first. During the
monitoring, the online implementation time of activities will be compared with the
plan. If the real time deviates from the predefined constraints, corrective action will
therefore be required to be taken in order to ensure the project end within the
deadline, as shown in Figure 2.

Figure 1: Closed-loop Management Control System

Figure 2: Stable Control System Performance

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This proposed project scheduling framework provides a general routine related to

the project scheduling procedure which optimizes the project at each scheduling
step. Many comprehensive techniques have been developed for buffer sizing,
proactive project scheduling and reactive project scheduling respectably. These
approaches are based on various objectives and considerations, which may behave
differently when applied to projects with different characteristics. Following this
section, several popular buffer sizing, proactive project scheduling and reactive
project scheduling approaches will be highlighted in Section 2. In section 3, these
techniques will then be used to construct the scheduling framework that was
proposed above based on various combinations. These distinguished frameworks
will then be tested on the projects with various characteristics using a large
experimental design set in order to evaluate their capabilities under the composite
objective of maximizing both the schedule solution robustness and schedule quality
robustness. Detailed knowledge of the characteristics of each strategy should
enable project managers to decide which framework should be selected, based on
the specific project characteristics and demands. Finally, Section 4 provides
conclusions of the work presented in this paper.

In the full paper 4 buffer sizing techniques, 3 proactive project-scheduling

approaches and 3 reactive project-scheduling approaches, are reviewed. However,
due to length constraints the review has been omitted from this manuscript and
instead we move on to testing directly. Naturally, the full review is available from
the corresponding author upon request.

2.1. The Robust Resource Constrained Project Scheduling

Framework

Four project buffer sizing techniques, namely False Positive rate (FPR), Root Square
Error Method (RSEM), Adaptive Procedure with Density (APD), (APRT), three
proactive project scheduling approaches, namely Resource Flow Depandant Flow
Factor (RFDFF), Walk with me (VADE), Sensitivity Time Control (STC) and three
reactive scheduling approaches, namely Finish to Finish (FF), Automated Bulk
Provisioning (ABP) and Resource Constraint Project Scheduling Problem (RCPSP),
are considered. These approaches are based on various objectives and
considerations, which may behave differently when applied to projects with
different characteristics. Using the robust scheduling framework proposed in
Section 1, any one method from each group can be selected and combined together
to construct a project scheduling procedure. Therefore, it is possible to create a
total of 36 robust scheduling strategies. In this section, the 36 scheduling
strategies will be tested using a series of projects with varying characteristics. The
results will be used to evaluate the each individual strategy’s capability under the
composite objective of maximizing both the schedule solution robustness and
schedule quality robustness. This process provides a guide which allows project
managers to identify the proper scheduling methodology for different project
scheduling environments.

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2.2. Test Rationale

In the test, all 36 procedures described above will be investigated using a MatLab
simulation. A standard test is set up at the beginning. Based on this standard test,
four individual parameters that could influence the capability of the 36 approaches
will be applied individually using four separate tests. This will provide an
investigation into the effectiveness of the 36 approaches under different situations.

For each test, the total number of 30 random project networks with 10 non-dummy
nodes will be generated using project RanGen (Demeulemeester et al., 2003).
RanGen is a random network generator for generating activity-on-the-node
networks with the required amount of network resources and Order Strength (OS).
OS is defined as the number of precedence relations (including the transitive
relations, whilst excluding the arcs connecting the dummy start or end activity)
divided by the theoretical maximum number of precedence relations. The
deterministic RCPSP scheduling technique will be implemented on each network
created by RanGen to obtain the deterministic scheduling baseline. Based on these
deterministic schedules, the 36 approaches will then be applied to generate robust
project schedules.

Finally, the robust schedules generated using the 36 approaches will be compared
with the realized project schedules. The realised project schedules were simulated
based on various possible situations. The effectiveness of the 36 approaches was
measured by the average value of SR and QR indices over the 30 networks. The
project configuration measures ( flex , fldt , dsrp ) will also be calculated for the
deterministic baseline schedules to define its characteristics in order to investigate
the effectiveness of various robust scheduling approaches under different project
environments. All of these approaches are based on the assumption that the
project is executing to a predefined baseline schedule. If an event happens which
cause the activity to deviate from its baseline schedule, the reactive scheduling
approach will be applied. The testing procedure is expressed in Figure 3.

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Generate 30 random networks using

project RanGen with specified OS

Generate random parameters

(d, w, R, σ, Pdelay)

Create deterministic schedules using

deterministic RCPSP approach
Simulate realized schedules
Calculate configuration indices (flex, fldt, dsrp) and
resource indices (RF, RC) for deterministic schedules

Construct 36 robust schedules

using proposed framework

Calculate the robustness indices

(SR, QR) for robust schedules

Compute the average value of robustness

indices over the 30 networks
Figure 3: Testing Procedure

Each of the tests was based on the simplest single-project and single-mode RCPSP.
Each has finish-start precedence constraints, zero time lag, no pre-emption and
fixed renewable single resources. The basic parameter settings for the whole test
are listed in Table 1.

Symbol Description Value

n number of don-dummy activities 10
d max maximum duration for all the activities 5

di duration for activity i d i  d max

Pd i  ~ 0,1
rmax maximum resource requirement for all the activities 40
ri resource requirement for activity i ri  rmax
Pri  ~ 0,1
wmax maximum weights for all the activities 10
wi weight for activity i wi  wmax
Pwi  ~ 0,1
Table 1: Basic configuration parameter settings

For the purpose of this case study, excluding the standard test, four variables that
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possibly could influence the capability of project scheduling approaches were

adjusted under each test individually. By doing so it was possible to investigate the
effectiveness of each approach under various scenarios. The values for the
parameter settings used in each test are detailed in Table 2.

Symbol Description Value

Standard OS order strength 0.5
Test R total availability of resource rmax
 estimated standard deviation of an activity 1.0
duration
Pdelay probability of  not being the same as estimated 0.2
Test 1 OS order strength 0.2:+0.1:0.8
Test 2 R total availability of resource 1 rmax :+0.2 rmax :2 rmax
Test 3  estimated standard deviation of an activity 0.8:-0.2:0.2
duration
Test4 Pdelay probability of  not being the same as estimated 0.1:+0.05:0.3
Table 2: Variable settings for individual tests

2.3. Some Test Results

The results for each of the tests are detailed within the following section. Each
result was obtained through implementing the experimental designs in MatLab. Due
to lenght constraints only one data set has been addressed in this paper. For the
full results please contact the correponding author.
Standard Test:
In this test, the parameters are set as OS=0.5, R  rmax ,   1.0 and Pdelay  0.2 . The
SR and QR indices for all the 36 approaches are listed in Table 3 and Table 4
respectively.
FPR FF ABP RRCPSP Proactive
RFDFF 202.0667 205.0667 246.4667 217.8667
VADE 238.5333 241.5333 274.5333 251.5333
STC 392.5000 395.5000 417.0333 401.6778
Reactive 277.7000 280.7000 312.6778 290.3593
RSEM FF ABP RRCPSP Proactive
RFDFF 163.0333 165.6333 206.4000 178.3556
VADE 192.7333 195.7333 230.9667 206.4778
STC 358.3667 361.3667 377.0667 365.6000
Reactive 238.0444 240.9111 271.4778 250.1444
APD FF ABP RRCPSP Proactive
RFDFF 74.3333 76.7333 115.3000 88.7889
VADE 89.4667 92.4667 122.1000 101.3444
STC 200.8667 203.8667 213.5000 206.0778
Reactive 121.5556 124.3556 150.3000 132.0704
APRT FF ABP RRCPSP Proactive
RFDFF 143.4333 146.2333 183.9667 157.8778
VADE 171.2667 174.2667 202.9333 182.8222
STC 330.0333 333.0333 350.5000 337.8556
Reactive 214.9111 217.8444 245.8000 226.1852
Table 3: SR Indices for Standard Test
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FPR FF ABP RRCPSP Proactive

RFDFF 24.8833 24.8833 24.7833 24.8500
VADE 25.1000 25.1000 25.0000 25.0667
STC 25.8500 25.8500 25.7500 25.8167
Reactive 25.2778 25.2778 25.1778 25.2444
RSEM FF ABP RRCPSP Proactive
RFDFF 24.0833 24.0833 23.9833 24.0500
VADE 24.3333 24.3333 24.2333 24.3000
STC 25.1167 25.1167 25.0167 25.0833
Reactive 24.5111 24.5111 24.4111 24.4778
APD FF ABP RRCPSP Proactive
RFDFF 22.3333 22.3333 22.2333 22.3000
VADE 22.5333 22.5333 22.4333 22.5000
STC 22.9833 22.9833 22.8833 22.9500
Reactive 22.6167 22.6167 22.5167 22.5833
APRT FF ABP RRCPSP Proactive
RFDFF 23.8167 23.8167 23.7167 23.7833
VADE 24.0167 24.0167 23.9167 23.9833
STC 24.7500 24.7500 24.6500 24.7167
Reactive 24.1944 24.1944 24.0944 24.1611
Table 4: QR Indices for Standard Test

Tables 3 and 4 compare the SR and QR indices for each of the 36 approaches
respectively. In Tables 3 and 4, the SR/QR indices for four buffer sizing technique
lead approaches are allocated in four different sub-tables. In each sub-table, the
average SR/QR indices for each reactive scheduling approach are listed in the last
row, the average SR/QR indices for each proactive scheduling approach are listed in
the last column, and the average SR/QR index for that sub-table expressed buffer
sizing technique is displayed in the right bottom corner. Table 3 and 4 demonstrate
that the APD buffer sizing technique lead group approaches have both the lowest
SR and QR indices. The RFDFF approaches produce the lowest SR and QR indices
compared with other proactive scheduling approaches. Table 3 illustrates that the
FF approaches are with the lowest SR indices compared to other reactive scheduling
approaches, and differently, Table 4 demonstrates that the RRCPSP approaches are
with the lowest QR indices, however, they are not much lower than the FF
approaches. Tables 3 and 4 prove that based on this standard test parameter
setting, APD-RFDFF-FF is much more preferable than other approaches.

3. Conclusions

The purpose of this research is not to compare and contrast alternative scheduling
approaches in order to conclude on relative robustness as such, but rather to prove
that when seemingly competitive approaches are combined better results can
potentially be realised. Therefore, commentary regarding all conclusions in this
paper is based on predetermined testing conditions. In that respect careful
project scheduling has been shown to be an important factor in improving the
success rate of a project. This paper proposed a robust project-scheduling
framework by combining the buffer sizing technique, with the proactive project
scheduling approach and reactive project scheduling approach. The new proposed
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framework deals with the project-scheduling problem from the start of the project
throughout to the finish, a rationale that admittedly provides a whole project
scheduling strategy that is more tolerant to various uncertainties that could
potentially be encountered.

Based on four buffer sizing techniques, three proactive project scheduling

approaches, and three reactive project scheduling approaches, 36 defined
scheduling results were generated using the initial proposed framework of page 3.
A large experimental design set was used to test each of the frameworks on
projects with a variety of characteristics. It was then possible to identify the
effectiveness of each procedure under different project scheduling environments
using the correct scheduling methodology. The test results indicate that all of the
suggested approaches provide sufficient protection against delays in project
completion times and as such address pertinent cost/financial gains.

4. References

Demeulemeester, E., Vanhoucke, M. and Herroelen, W. (2003), ‘‘RanGen: A

random network generator for activity-on-the-node networks’’, Journal of
Scheduling, 6, 17-38.
Herrmann, J.W. (2006), ‘‘Using the rescheduling framework to improve production
scheduling’, Rescheduling Strategies, Policies and Methods, US: Springer.
Van de Vonder, S., Ballestín, F., Demeulemeester, E. and Herroelen, W. (2007),
‘‘Heuristic procedures for reactive project scheduling’’, Computers & Industrial
Engineering, 52, 11-28.
Wang, J. (2005), ‘‘Constraint-based schedule repair for product development
projects with time-limited constraints’’, International Journal of Production
Economics, 95, 399-414.
Zhu, G., Bard, J. and Yu, G. (2005), ‘Disruption management for resource-
constrained project scheduling’’, Journal of the Operational Research Society,
56, 365-381.

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AA114

Planning, implementing and managing energy efficiency projects at

focused local level: The RURASU project successful example and the
SAVE-AGE project objectives

Konstantinos C. Zapounidis
(Project Manager, Pieriki Local Development Agency, Katerini, Greece
Invited Lecturer, Aristotle University of Thessaloniki, Thessaloniki, Greece )

Betty A. Partsalidou
(General Manager, Pieriki Local Development Agency, Katerini, Greece)

Darko Ferčej
(Director of e-institute, Institute for Comprehensive Development Solutions, Ptuj,
Slovenia )

Anja Prislan
(Project Manager, Institute for Comprehensive Development Solutions, Ptuj,
Slovenia)

Abstract
The effort to succeed the EU’s commitment of the “20-20-20” initiative-reducing
greenhouse gas emissions by 20%, increasing the share of renewable in the energy
consumption to 20% and improving energy efficiency by 20%, requires multi-level
actions and special projects that should be focused on specific targets. Additionally
to the large-scale projects, mainly focused on RES at national level, it is important
to provide support and knowledge at local level, especially in the sector of energy
efficiency. Local actors and citizens outside major urban areas are often unaware of
techniques and measures that could add the maximum potential gains to the
overall targets in the energy sector. For this reason, Pieriki Anaptixiaki-local
development agency in Greece (Pieriki) has implemented successfully several
projects focused on disadvantageous categories of citizens and areas. Moreover,
Pieriki is launching, under the coordination of E-zavod (Slovenia), a new
transnational project focusing on strengthening energy efficiency awareness among
residential homes for elderly people, under the title of SAVE-AGE.

Keywords
Energy efficiency, project management, rural areas, residential care homes

1. Introduction

The effort to succeed the EU’s commitment of the “20-20-20” initiative-reducing

greenhouse gas emissions by 20%, increasing the share of renewable in the energy
consumption to 20% and improving energy efficiency by 20%, requires multi-level
actions and special projects that should be focused on specific targets. Additionally
to the large-scale projects mainly focused on RES at national level, it is important
to provide support and knowledge at local level, especially in the sector of energy
efficiency. Local actors and citizens outside the major urban areas are often

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unaware of the techniques and measures that could add the maximum potential
gains to the overall targets in the energy sector.

For this reason and in full accordance with EU policies, Pieriki Anaptixiaki-local
development agency in Greece (Pieriki), has implemented successfully several
projects (funded by European Commission’s programmes and Institutions) focused
on disadvantageous categories of citizens and areas; rural areas buildings (RURASU
project), urban areas with no scientific support (REASURE project), social housing
(ECOLISH project). Moreover, Pieriki is launching a new project (funded by the EC’s
European Agency for Competiveness and Innovation under the Intelligent Energy
Europe II programme), under the coordination of E-zavod (Slovenia), focusing on
strengthening energy efficiency awareness among residential homes for elderly
people, under the title of SAVE-AGE. This project has incorporated elements of
feasibility potentiality and of managing possible confronted risks, as
multidisciplinary actions are required-including engineering, social sciences, physics
and economics. The project’s objectives tie in with European and national priorities
and policies, although some times the existing legislation that governs the under
focus buildings and installations and, moreover, the delay in the adaptation of EC
Directives as national legislation could create important delays that could lead to
jeopardising of the project in general.

2. Projects focused at local level supporting European energy

priorities and policies

Although important work has been achieved in the sector of disseminating

knowledge and increasing awareness of citizens and professionals in the sectors of
RES and energy efficiency, actual results of such applications are not so easily
understood due to lack of actions implemented at local level. Local actors and
citizens are many times reluctant to adapt proposed technologies and techniques
based on experimental and research results. Moreover, students, practitioners and
professionals related to these specific sectors, are incommoded in proposing or
adapting such technologies and techniques, since they are not so technically aware
on their operation and/or also unaware of their installation format. Finally, there
are areas in Europe, although having an important RES potential, that applications
are not so important, basically due to local reactions (in a great degree due to lack
of sufficient preparation and dissemination) and lack of political will. This reluctancy
on behalf of individual citizens, public-sector officers, planners, building
professionals, local actors, public authorities, SMEs could be faced through project
focused in dispersed local areas where knowledge is not so widely spread out and
training activities are not so easily organised. In this way support could be achieved
at the higher possible level. These projects aim to accelerate the penetration of RES
in buildings with dissemination and demonstration activities, while providing the
appropriate training to professionals in order to fulfil the potential requirements of
the new RES systems market.

Successfulness of these projects is reassured from the type of the involved

partners, like Pieriki local development agency -their activities are prescribed by the
wider European philosophy, for more essential decentralisation, with active
contribution in the planning and management of the development resources,
through the coordination of all local institutional authorities. Especially for Pieriki,
the detection, research, promotion, support and realization of integrated proposals
for the development of Pieria Prefecture is achieved through the productive
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exploitation of national and European financial support and development

programmes. The company's strategy determines its contribution in the evolution,
exploitation, promotion, development, management and protection of the natural
and human resources and the development of Pieria Prefecture.

Regarding European dimension, these projects aim to trigger local market and
support training activities which will provide professionals the required skills to fulfil
the needs and desires of the new market. Such local community markets could
produce success stories, based on the benefits which local markets could adapt
from the penetration of RES systems. It has to be mentioned that small scale RES
systems and energy efficiency techniques are proposed through these projects and
therefore it should be expected that a significant part of the financial benefits will
remain in the local communities.

Having analysed the experience of projects’ partners, the potential for proposing an
initiative at European level is clear, where the experience of each partner, supports
the others to achieve better results. In this sense, the projects are developed at
European level because the expected results are more important and deeper than
those at local level by the developed Action Plans. The success of the projects is
only possible through the experience exchange among member countries and the
communication and diffusion of the obtained objectives, which are the key points of
these proposals. The communication and dissemination actions of the actual
achieved results are transferred, as planned, at local and European level. Finally,
the possible high use of RES systems in an area results to local and general
environmental improvement which is the main target of these projects. It is though
concluded that the projects offer added value results and a European dimension to
scattered local actions.

These projects take into account the common desire of all people for improving the
local and general environment while it involves local communities from North, East
and South Europe which are in different climate, organization levels, financial and
local conditions. The different Partners involved have various experience level
which affect the final outcomes of the project. The most experienced Partners are
expected to provide technical support to non-experienced Partners in order to
achieve the Project's outcomes.

These projects strengthen the collaboration of organizations located in different

European countries having as common target the improvement of the local and
general environment through the use of RES system or solutions and energy
efficiency techniques. The framework of the projects is based in a general concept
of knowledge transferability: local installations to be visited by all interested
parties, training courses, support actions to local authorities and to citizens,
guidelines provision. Furthermore, communication strategy is drafted for all pilot
actions in order to transfer the results at local level (local dissemination actions),
transnational level (pair dissemination activities) and international level
(conferences). An important number of communication actions is always planned in
order to disseminate results all over Europe. Apart from these actions the locally
based organisations, implementing the local actions, transfer their knowledge to
other organisations of their countries.

 
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3. The RURASU project successful example

RURASU project focused on energy problems of each involved rural area (Pieria in
Greece, Allgäu in Germany, South Ayr in United Kingdom, Cordillera Subetica in
Spain), aiming to support dispersed local actors like engineers, buildings designers,
public authorities and consumers on the use of renewable energy sources and
energy efficiency measures in the building stock. The support was continuous,
throughout the project duration, and was achieved through the setting-up (in
United Kingdom and Spain) and further development (in Greece and Germany) of
Rural Design and Advice Support Units (DASUs).

The continuous support provided to local actors resulted in the broader use and
implementation of renewable energy sources and energy efficiency techniques.
Important elements were:
 Development of educational materials (Information Acquisition Tool, leaflets
etc.)
 Analysis, training and consultations regarding the European Buildings Directive
(2002/91/EC)
 Networking and training of the involved professionals and support of local
energy management in general.

The overall objective of the action was to provide energy management, energy
conservation consultancy and services in rural areas. This objective was achieved
fully through the proved establishment and operation of the four Design Advice and
Support Units (DASUs) of RURASU project in the involved rural areas of the four
predetermined countries. Taking into consideration the current state-of-the-art, 4
DASUs have been established and are fully operating in the rural areas of the four
involved countries; Pieria in Greece, Allgaü in Germany, South Ayrshire in Scotland-
U.K. and Cordillera Subbetica in Spain. For the establishment process of the new
DASUs and the further development of the existing DASUs, reports have been
prepared. The reports of project’s Work Package 2 have been revised in order to
better serve the purpose of disseminating good inspiration from and experience of
the participating regions to other EU regions that have similar needs and
opportunities to adapt or replicate RURASU practical approach. This objective is also
achieved by the creation of an Action Agenda for DASU set-up in rural areas.

The idea of supporting energy efficiency and RES in rural areas is a replicable
concept. Moreover, a number of deliverables produced could be important
methodology tools for other regions in Europe. In more detail, “Formulation of an
action agenda for DASU set-up in rural areas” (comprising technical, administrative
and financial aspects) is formulated in such a general way that it can be easily used
in other EU regions. The Action Agenda was disseminated broadly, as part of the
dissemination policy. Moreover, “Report on the experiences of the existing DASUs
in the rural environment in Germany and Greece”, “Report on the set up and
operation of the new rural DASUs” and “Report on the further development of DASU
work in Greece and Germany” are three important methodology tools for
replication. Especially the last two have been revised in order to better serve the
purpose of disseminating good inspiration from and experience of the participating
regions to other EU regions that have similar needs and opportunities to adapt or
replicate RURASU practical approach.

PIERIKI ANAPTIXIAKI S.A.-O.L.A., coordinating RURASU project and implementing

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local actions in Greece, is identified as the energy operator for the whole Pieria
prefecture and including urban and rural areas of the prefecture. From initial
enquires regarding simple subjects on RES and energy efficiency to advanced
enquires on sophisticated RES and energy efficiency subjects and funding
possibilities, PIERIKI’s offices are the first place that a citizen of Pieria visits, having
implemented numerous consultations and dissemination actions on small scale
installations, based on national or European funding. Moreover, the executives and
managers of PIERIKI are often invited to participate in conferences and congresses
organised in Pieria, Greece and Europe, as the most appropriate local actors in the
sector of energy and sustainability. Actions in disseminating energy knowledge in
rural areas led to the national ENERGY GLOBE AWARD for GREECE in 2006 (project
RURASU). Along with its consulting and technical character, the company promotes
innovative development initiatives for the more effective absorption of national
resources and E.C. allocations, in collaboration with Local Administration
Organizations, production - development institutions and Prefecture authorities.

4. The SAVE AGE project framework

More than 1,5 million residents live in 24.000 Residential Care Homes for Elderly
People (RCHEP) represented under the European Association for Directors of
Residential Care Homes for the Elderly People (E.D.E.). Most of these buildings are
not energy efficient due to the lack of awareness of the management regarding
energy efficiency benefits and due to the lack of knowledge and organization in
residential homes. Moreover, RCHEP managers do not fully recognize benefits of
energy efficiency nor can they afford the employment of experts with specific
technical skills. This sector is also specific as every investment lays as a burden for
elderly people and their relative who often pay the bills for hospitality. In addition,
inevitable ageing of European population will contribute to worsening the situation
in the near future.

Since employees and managers of RCHEP are mainly social care professionals, they
lack knowledge on energy efficiency and in many cases also foreign language skills
and in some cases even computer literacy. Therefore, the first step that has to be
done is to change RCHEP managers’ attitude towards more energy efficiency.

The SAVE AGE project will build upon analysis of the current situation, searching for
technical, behavioural, knowledge and financial obstacles towards energy efficiency
in RCHEP. Secondly, the project will use the already established E.D.E network
representing 24.000 homes to convince RCHEP managers to implement energy
efficiency strategy and action plan with the aim to stimulate investment and no or
low-costs measures leading to energy savings in RCHEP. Thirdly, a set of
educational/training activities will be developed at national level and some pilot
RCHEP will be established to test the various action plans. All these actions will be
heavily supported with communication/dissemination activities aiming at raising
awareness in order to change behaviour of RCHEP staff and residents to become
more energy efficient. Since there were no large-scale analysis on energy efficiency
done in the field of RCHEP before, all the information gained through this project
will also be valuable for policy-making at EU level.

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4.1 Specific objectives of the SAVE AGE project

The main objective of SAVE AGE project is to raise awareness on energy efficiency
in Residential care homes for elderly people. RCHEP are the biggest European group
organized within European Association for Directors of Residential Care Homes for
Elderly People (E.D.E.) covering 24.000 homes and 1,5 million inhabitants across
15 EU member states. Future demographic trends show that these numbers will
double within the next 20 years, but energy efficiency problems will stay the same,
if not addressed properly. The Intelligent Energy Europe programme is a good
opportunity to implement energy efficiency dissemination actions on wide EU level.

Project will prepare Energy efficiency strategies through initial analysis and action
plans (both at EU and national level), best and worst practices will also be identified
and pilot actions to demonstrate energy efficiency needs in RCHEP will also be
established. Transnational and national dissemination events will encourage RCHEP
management to undertake energy efficiency soft measures and investments in
order to reduce costs and greenhouse gas emissions.

Another specific objective is to educate and train Residential care homes staff on
energy efficiency. RCHEP managers and housekeepers lack specialized energy
efficiency knowledge and energy efficiency awareness is a low priority due to home
care needs. Changing this attitude would bring big multiplication effect and short as
well as long term energy efficiency. This will be achieved nationally with national
seminars, trainings and internationally with E.D.E. seminars.

Furthermore, SAVE AGE project aims to accept strategic orientation of E.D.E.

members towards energy efficiency. Strategic orientation for energy efficiency at
E.D.E. level would have large effect on the energy efficiency of the 24.000
residential homes. E.D.E. will accept to raise the energy efficiency topic as one of
the main goal of the organisation. Strategic orientation towards sustainable energy
use in E.D.E. organization will contribute to raise awareness of its members and
consequently to decrease energy use in RCHEP. This goal will have important long
term positive effects as the strategic orientation will remain a priority even after the
project's end. The E.D.E association will also organize specific management
contests for promoting Energy Efficiency towards their members.

Finally, the project focus to increase energy efficiency in RCHEP across 10 EU

member states, since improvement of energy efficiency in RCHEP will have large
demonstrative effect among 24.000 E.D.E members. Pilot actions will introduce
energy efficiency manager for RCHEP in 10 EU Member States implementing soft
measures for increase of energy efficiency. Pilot visibility actions (printing and
installing visibility signs) will also help reduce energy consumption in RCHEP by
changing the behaviour of the RCHEP residents.

Significant impact is also expected on the energy efficiency market. Change of

mindset of RCHEP managers into more energy efficiency will bring indeed numerous
investments into the sector. Market potential goes even well beyond the 24.000
E.D.E. members if considering also the RCHEP that are not E.D.E. members and the
fact that elderly people will need more and more residential homes in the near
future.

Project will also put focus on elderly people as an important group for EU
environment policies. Hopefully project will help change priorities of EU also to
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energy efficiency in this specific sector. Putting more effort will be sooner or later
necessary on EU and on national level since the EU ageing process is irreversible.

4.2 Strategic (long term) objectives of the SAVE AGE project

Long term objective (5 years from the beginning of the project) is to achieve 5%
energy savings in 24.000 care homes for elderly people across 15 EU member
states. In numbers this will mean saving 1700 GWh per year and consequently a
reduction of 700.000 tons of CO2 per year.

After 10 years, the objective is to decrease the energy consumption in RCHEP by at

least 10% and to include residential and health homes that are not included in
E.D.E. energy efficiency initiative. The initiative could then also include similar
organizations like hospitals.

The continuation of this initiative after the project's conclusion will be ensured by
commitment of E.D.E. organisation. Financial means for continuation will be
ensured by project partner organizations themselves, by public authorities and also
by the private sector interested in commercial activities with homes for elderly
people.

5. Conclusions

A lot of years of research efforts have produced a broad understanding of the

implications of building energy use, as well as an increasing number of energy-
efficient strategies and technologies with significant potential for energy savings.
However, these strategies and technologies have not been effectively transferred to
the users of the buildings and to the building design community. A great number of
buildings are still designed and, moreover operated, without any energy- related
considerations beyond these required by national building regulations.

One reason that this knowledge gap still exists is because building operators and
designers do not have the means to assess efficiently and reliably the impact of
new strategies and technologies during the operation and during building design
process. One of the major barriers to the successful implementation of energy
efficiency measures in the built environment is the inability to get so-called
operators and professionals to understand the benefits of energy efficiency. It is
therefore necessary to provide advice and information to them who have, yet, to
fully realize the benefits of a more energy efficient project.

This need for design advice and support is even more important and necessary to
be provided to professionals acting in regions away from large cities where
provision of support is easier, as usually there are located academic institutes and
other educational and technical bodies with high expertise on the subject and
capability of providing support.

The involvement of Pieriki Anaptixiaki-local development agency and of other actors

that operate at local level and implement the aforementioned and other similar
projects in the field of sustainability with emphasis on energy saving and RES is
implemented gradually and through targeted planning, in order to achieve the
greatest possible public awareness and dissemination of knowledge in the most
successful manner.

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6. References

Böhm T., Zapounidis K., Pavlou C., Epp C. and Sambale M., “How to operate Advice
and Support Units for the promotion of Renewable Energies and Energy
Efficiency in buildings of rural areas”, eza!, Kempten, Germany and Pieriki
Anaptixiaki S.A.-O.L.A., Katerini, Greece
Böhm T. and Epp C. (2006), Information Acquisition Tool (IAT), WIP, Munich,
Germany
Commission of the European Communities (2009), “Intelligent Energy-Europe II,
2009 Work Programme”, Brussels, Belgium
Epp, C. and Sambale, M. (2006), “Report on experiences and knowledge on existing
DASUs”, eza!, Kempten, Germany
Ferčej D. and Prislan A. (2009), “SAVE AGE project proposal”, E-zavod, Ptuj,
Slovenija
Manzano Laguna M.J., Marnie A., Marquis L., Böhm T., Epp C., Strachan P. and
Sánchez de la Flor, F.J. (2007), “How to set-up Advice and Support Units for the
promotion of Renewable Energies and Energy Efficiency in buildings of rural
areas”, Brussels, Belgium
Sambale, M. and Zapounidis, K. (2006), “Action Agenda for DASU Setup in Rural
Areas”, eza!, Kempten, Germany and Pieriki Anaptixiaki S.A.-O.L.A., Katerini,
Greece
Sambale M., Marnie A., Marquis L., Strachan P., Manzano Laguna M.J., Sánchez de
la Flor F.J., Epp C., Zapounidis K., Oxizidis S., Papadopoulos A., Papageorgiou
K., Pavlou K. and Santamouris M. (2007), “Report on Public Relations Strategy”,
Brussels, Belgium
Pavlou, K. and Zapounidis, K. (2006), “Report on experiences and knowledge on
existing DASUs”, Pieriki Anaptixiaki S.A.-O.L.A., Katerini, Greece
Zapounidis K. (2007), “RURASU project: Final Report”, Pieriki Anaptixiaki S.A.-
O.L.A., Katerini, Greece

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AA095

Reformation of local development agencies seeking conservation in

their wider market

Konstantinos C. Zapounidis
(Project Manager, Pieriki Local Development Agency, Katerini, Greece
Invited Lecturer, Aristotle University of Thessaloniki, Thessaloniki, Greece)

Betty A. Partsalidou
(General Manager, Pieriki Local Development Agency, Katerini, Greece)

Glykeria Kalfakakou
(Professor, Aristotle University of Thessaloniki, Thessaloniki, Greece)

Abstract
Local development agencies, acting in Greece for almost 20 years, are facing
important threats for their existence; the general crisis and the specific new
imposed frameworks require immediate actions. Aim of this paper is to analyse this
situation and to provide information on the detailed framework that could be
adapted in order to succeed conservation. The analysis method is based on actual
data and on actual processes that have led to successful conservation results-
results that demonstrate the actual need for reformation.

Keywords
Change management, Crisis, Local development agency, Organisation
Development, Reformation

1. Introduction

In this time period the world, and especially Greece, is facing the worst economic
crisis after the 2nd world war. This subject is the main discussion theme, inside and
outside the work environment. Managers have limited possibilities to reverse this
negative climate. They have, though, to take decisions on how to manipulate the
results of this crisis. A method to be adapted is to operate differently, adapting
differentiated way of thinking, more constructive and creative. Economic crisis
should be managed under the perspective of creation and exploitation of the
opportunities that are emerging from it.

An important tool to be adapted in this effort is organisational change, change

related more to the spectre of potential clients and possible funding thus to
organisational format. To change something implies altering it, varying or modifying
it in some way. Organisations change, or adapt, what they want to achieve and
how. Some organisations change mainly in response to external circumstances
(reactive change); others change principally because they have decided to change
(proactive change) (Cole, 1996). Local development agencies of prefectural level in
Greece are organisations governed by private law and their existence is based on
the income of projects and programmes and not on fixed state funding. The general
uncertain environment is becoming more intense due to the changes on the legal
framework within which these companies have to operate and to changes of
political decisions. Having specific purpose in their statutes, these organisations are
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not so common to be proactive; nevertheless they should not stay pathetic but at
least react to these situations. Nevertheless, the ability to be driven up to a
proactive organisation could be the optimum case.

The Local Agencies under consideration implement projects aiming to the

development of their areas and in such way they do not operate as existing
commercial enterprises. As a principle they do not distribute profits to their
shareholders (mainly public bodies and bodies of public interest)-profits (if they
exist) are invested for local development actions. Local Agencies are not being
funded by the national budget or by shareholders’ financial contributions, since this
is against the existing legal framework. As a result, implementation of projects and
programmes is the only income possibility for them; nevertheless local
development is their operational framework. New entities with the participation of
the Local Agencies are not created during programmes or projects, although some
programmes fund the creation of new independent enterprises. Local agencies’
strategy is determined by their contribution in the evolution, exploitation,
promotion, development, management and protection of the natural and human
resources, cultural heritage, and industrial development of their areas. Along with
the consulting and technical character, the local agencies promote innovative
development initiatives for the more effective absorption of national resources and
E.C. programmes, in collaboration with local administration organizations,
production - development institutions and local authorities.

Changes does not always imply innovation, in our case it has to do with
approaching new markets and potential clients seeking income and funding-that is
required for the existence of the organization. For this to be achieved organization
development should be incorporated as an in-house process.

2. Organisation Change and Development Background Framework

2.1 Change Management process

The process with which “successful” companies operate their change activities has
been the focus of a great number of researchers for many years. Of course
definition of “success” is not common for all researchers; nevertheless
growth/development above market’s average and financial return could be stated
as two basic and common characteristics along with innovation, which is,
unfortunately, prescribed differently for each company.

Peters and Waterman (1982, 1998) identified attributes of excellence, some of

which can be adapted to our case study organisations as follows:
 They have a bias towards action, once a problem is identified, it is analysed
and people are expected to come up with solutions.
 They listen to customers.
 They encourage internal autonomy and entrepreneurship.
 Employees are held in high esteem, but in a performance-conscious
environment, expectations are high
 They emphasize the organisation’s basic values (culture) and demonstrate
their commitment to them
 Control is loose yet tight; it is loose in that decision-making is pushed
downwards, but tight in that certain core values/practices are insisted upon

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Change management, in our focus example, is related to the required organisation

development, requiring (Bechhard, 1969) an effort planned, organisation-wide and
managed from the top to increase organisation development and health through
planned interventions in the organisation’s “process”, using behavioural science
knowledge. Although stated more than 40 years ago, definition of organisation
development by Warren Bennis (1969) as a response to change, a complex
educational strategy intended to change the beliefs, attitudes, values and structure
of organisations so that they can better adapt to new technologies, markets, and
challenges, and the dizzying rate of change itself, is very representative for our
focus example.

2.2 Implementation framework and problems faced

Although organisation development has a vast literature background, managers and

responsibles of implementing such processes should prepare their on methodologies
and tools. Nevertheless, there are values that could create a baseline framework
and these were also the basis in our analysis. In such a framework each individual
should be treated with respect and dignity and the organisation climate should be
characterised by trust, openness and support. Hierarchical authority and control are
not regarded as effective mechanisms and people affected by change should be
involved in its implementation. Finally, problems and conflicts should be confronted,
and not disguised or avoided.

The Organisation Development movement has been associated with the argument
that hierarchical and bureaucratic constraints are negative factors and that the
caring, sharing, empowering organisation is not only a better place to work, but is
financially and materially more effective.

A major barrier in organisation change and development is the resistance to

change, as most people need to be persuaded to the need to change and other fear
it. The reality is that every human grouping has some forces within it which keep it
together and provide it with stability and others which provide it with a reason to
change or adapt. Nevertheless, in our situation since change is of vital importance
for the existence of the organization under consideration, we are not analyzing
processes of development and re-engineering only, but also these of reformation, in
order to approach new funding potentials. As a result, resistance to change requires
radical action and, of course, full elimination. Since this could not be totally
achieved, those resisting should be manipulated in a way that they should not
influence other individuals.

Important influences in the change of processes require reformation of the

operational procedure. Fundamental principle is companies/organizations to
redesign their internal processes in order to minimize unnecessary elements that
consume time, workforce and resources required for their implementation.
Objective is the scaled change instead of the gradual change.

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Performance

Scaled change

Gradual change

Time

Fig 1: Scaled-gradual change

Due to the special circumstances that the under investigation agencies are facing,
scaled change is a one way road-no time is available fro gradual change in such a
severe market situation. This requires reformation of the enterprise’s processes,
something that the companies with excellent performance implement often as part
of their working framework. In this framework, Project Manager has to study the
assumptions underlying the existing problematic procedures and how to eliminate
them. Due to the undergoing changes, compromises on standards and operating
practices of the organization are held and the “as usual” scenario does not exist
anymore, as different individuals and activities are required.
Benchmarking-as a temporary baseline with position or size decided on relevant
measures and criteria, could be a useful tool for judging other circumstances. Key
performance indicators in our case study could be the percentage of projects on
time and the indicators of customers’ satisfaction. Establishing benchmarks
involves the study of very basic information, usually financial ratios that provide an
average comparison rate of total efficiency of management. Wrong choice of
numbers can be misleading and comparison between disparate sets of statistics is
not performing satisfactorily in such a process. Much more interesting and far more
potential benefits reveals to the project manager are the study and analysis of the
processes behind the numbers. Framing procedures provide useful information on
how to deal with these constraints, how to bypass obstacles and how to solve
problems. Successful is the method of networking among project managers-the
problems faced by managers are often solved more easily by others rather than
themselves. The output data reference measurement has clear advantages. The
comparison may include operating works: implemented into the same functional
body, internal projects: carried out by the company, general works: studies related
to procedures and comparison with projects having similar procedures, competitors’
reference measures: comparison with competitors. Basic measure is productivity,
the product produced per unit of resources employed. Categories for which
objectives are set and measures are prepared are: financial perspective, internal
entrepreneurial perspectives, innovations and knowledge management.

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2.3 Alternative management process adapted

It is required to define the differences from the conventional Taylor approach since
customers in crises periods tend to change their usual habits and experiment with
new “packets” within which it is more easily to be allured. Reformation of the
services offered to the traditional customers is required, incorporating
characteristics that enhance value and discarding those that add limited value and
charge cost disproportionately.

Traditional management faces the reduction in turnover as given and as such the
revenue reduction. Therefore in order to maintain acceptable profitability (within
healthy profit margins and liquidity) cost cuts across all activities are proposed. In
addition, price reductions in order to convince reluctant customers are proposed.
These trigger similar reactions from the competition and further pressure to profit
margins and earnings-threatening liquidity (Paufler, 2009).

Additionally to the aforementioned, alternative procedures are required taking into

consideration the prospect of economic recovery and boom. In such, facing a
potential increase in sales and focus on efforts to recast the value of products that
offer more creative and enticing way should be adapted. These lead to increased
sales to non customers and selected cost reduction (of rejecting the relevant
characteristics), while maintaining profitability, profit margins and liquidity.
Economic cycles are repetitive and immanent. Businesses must learn to effectively
manage the crisis and to prepare (strategically) for the upcoming recovery. Rules
for this are: increase of sales and reduction of costs through product redesign,
expansion to new customers, and focus not only on problems.

3. Case study analysis

The aforementioned framework was adapted by the local development agency of

Pieria Prefecture (Pieriki) leading to the achievement of its conservation during this
crisis, confronting the rest negative characteristics faced for such kind of
organisations. It is important to present that although executives of different level,
representing horizontal and vertical structures (general and project management)
within the organisation, face reasons of change/development and problems in this
process and come up with solutions to these problems, they have common views,
mainly to the urgent need of change imposed from the crisis.

The Case study presented is already implemented by Pieriki and due to the
successful results could be a proposal for replication. Pieriki, as an organisation
operating under ISO standards, kept and improved the high quality standards of
the services offered to the new range of clients.

3.1 Reasons for organisation development and change

 Change to the external working environment (legal framework of projects’

implementation, municipalities’ merge plan, technological evolution, legal
framework for working conditions in local development agencies).
 Necessity for offering new services that will cover clients’ new needs
(municipalities, prefecture, legal bodies, social actors, etc.) and requires re-
planning of the factors that define the attractiveness of the agency.
 Necessity for increase in the satisfaction of clients in order to “survive” in the
competitive environment.
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 Necessity to survive after the decrease of “stable” projects that come from
the operational co-funded programmes
 Necessity for reaction possibility of all human resources to the chances that
are offered via new funding means (at European level, transnational, etc.)
that require expertise knowledge and experience.
 Necessity for adjustment to the current ways of internal operation in general
(organisational breakdown structure, technological compliance, human
resources management).
 Identification of risks in services offering and public procurement.
 Necessity for conservation of high morale within the agency (absences,
withdrawals, climate, etc.)
 Previous and existing funding tools will not be available in the near future or
their size will be decreased at important level.

3.2 Problems faced during organisation development and change

 Inability of personnel to react to change, psychological pressure.

 Limited financial resources that could support the possibility of funding
development programmes (increased credit risk due to liquidity problems).
 Insecurity that is created by the personnel that “sabotages” adaptation to the
new situation and the relation with the administration.
 Negative reaction from the personnel for acceptance of change and offering
of new services. Possible need of dismissals and recruitment of expert
professionals, leading to the disturbance of the working conditions.
 Changes in management create fragile internal environment of adaptation to
development. High administration is possible that has not perception for the
necessity of adaptation.
 The new legal framework does not allow flexible required moves (i.e. work
contracts).
 Low effort for penetration in the market due to insecurity and retard of
important executives.
 Unfair competition that could be generated between agencies which have
either to merge or act together in a new geographical area. With the
implementation of municipalities’ merge plan new geographical data will be
created, that will create possible risks for obligatory merging or absorptions
and so changes in the internal environment.

3.3 Solutions implemented during organisation development and

change

 Improvement of motivation and reward system.

 Rediscovery of the agency’s vision.
 Seeking of new funding tools and methodologies.
 Exploitation of powerful collaborations between companies for the
maximisation of the benefits
 Reformation of the relation between agency and participants (personnel,
shareholders, clients, suppliers).
 Implementation of special training programmes for the executives that will
embrace the agency’s vision and definition of efficiency measurement tools of
the new services.
 Commitment to the technological development.

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 Training and development of the board of directors’ members in order to

have successful company profile that could implement “painless” and
successful adaptation to the new situation.
 In order to prepare the personnel and face “bad” possible responses,
meetings were organised with all of them or with those that were negative to
change having as subject to present the new situation, the future vision and
the sacrifices to be accepted. The implementation process was based in the
activation of the existing principles of the in-house experts. In this way the
differentiation of the external environment was faced as a “new challenge”
resulting to the enlargement of the offered services. As a result it was
required to implement rules for ensuring the quality standards in relation
with the offered services. This factor was reassured initially with the training
of the in-house experts to the new working fields along with specific co-
operations that ensured quality of the produced result.

4. Results

Organizations must, after all, cater for the special needs and aspirations of their
employees/members if they aim to exploit heir skills successfully and to retain their
primary source of competitive advantage, involving changes in structure, culture
and, mainly, management style employed within them. The traditional bureaucratic
command and control structure will have to be jettisoned in favour of more flexible
team and project-based management approached. Outcome of analysis related to
motivation (Zapounidis, Kalfakakou and Athanasiou 2008) pointed that
organizations motivate their employees, mainly by prompting them to participate in
different levels of decision making, and are positioned closer to the participating
management model, although their approach was rather unorganised and based
mainly on interpersonal relations.

What is planned to be achieved with the organisational development interventions

are:
 Improved organisational effectiveness, including better productivity and
morale
 Better management throughout organisation
 Commitment to and involvement in making the organisation successful
 Improved teamwork
 Better understanding of organisational strengths and weakness
 Improved communications, problem solving and conflict resolution
 Creativity, openness, opportunities for personal development
 Decrease in dysfunctional behaviour-politicking, playing game
 Increased ability to adapt to changing circumstances
 Increased ability to attract and retain quality people

Nevertheless, the following possible errors that could lead unsuccessful

organisational change and development (Kotter, 1995): sense of urgent is not
created, powerful guidance coalition does not exist, lack of vision, insufficient vision
transfer, obstacles are not removed towards new vision, omission of planning and
achievement of short-term successes, quick victory declaration, changes do not
keep up pace with organisational culture.

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5. References

Beckhard, R. (1969), “Organizational Development: Strategies and models”,

Addisson-Wesley, Reading
Bennis, R.M. (1969), “Organisation Development: Its nature, Origins and
Prospects”, Addisson-Wesley, Reading
Buchanan, D. and Huczynski, A. (1997), “Organizational behaviour: an introductory
text” (3rd edition), Prentice Hall, London
Cole, G.A. (1996), “Management, Theory and Practice” (5th edition), Letts, London
Harvard Business School press (2002), “Harvard Business Review on Change”,
Klidarithmos, Athens
Issues in People Management (1999), “Knowledge Management: a Literature
Review”, Institute of Personnel and Development, IPD House, London
Paufler, A. (2009), “Crisis management, getting over Taylorism”, in: Kathimerini
newspaper, Athnes, Greece
Peters, T. and Waterman, R. (1982), “In Search of Excellence: Lessons from
America’s Best Run Companies”, Harper & Row, New York
Peters, T (1988), “Thriving on Chaos-Handbook for a Management Revolution”,
MacMillan, London
Robbins, S.P. (1986), “Organizational Behaviour: Concepts, Controversies, and
Applications” (3rd edition), Prentice Hall International, NJ
Talwar, R. (1994), “Re-engineering – A Wonder Drug for the 90’s?” in: Coulson-
Thomas (ed), Business Process Re-engineering-myth or reality, Kogan Page
Warwick, D.D. (1984), “MODMAN: Managing Organisational Change and
Development”, Science Research Associates Inc., New York
Zapounidis, K.C., Kalfakakou, G. and Athanasiou, V. (2008), “Theories and Models
of Motivation and Leadership, Case Study Application”, in: PM-04 - 4th SCPM &
1st IPMA/MedNet Conference “Project Management Advances, Training &
Certification in the Mediterranean”, Chios Island, Greece

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AA079

Projects for the Design of Changes

Dagmar Zuchi
(Partner, Roland Gareis Consulting, Vienna, Austria)

Abstract
According to Levy and Merry (1986), changes can be differentiated into first order
changes and second order changes. First order changes describe changes in few
dimensions of the identity of an organization (e.g. changes in the products &
services offered) that might be performed continuously and not necessarily lead to
a change of the overall identity of an organization. Second order changes include
changes in many dimensions (e.g. the new organizational structures of a company,
including impacts on personnel, infrastructure, budget, etc.) and lead to a new
paradigm, a change in the identity of a company.

In the paper, change will be considered as fundamental, holistic change of an

organization, and it will be further differentiated between “radical new positioning”
(as consequence of a crises or chance) and “transformation”. This “discontinuous”
change can happen if strategic alliances are undergone, through the merger of
companies, or through existential loss of market shares.

Such a change has an impact to all dimensions of an organization and is of high

strategic importance. The high complexity of the change demands an appropriate
complexity in the design of the process. On the one side, immediate measures
must be taken, on the other side, projects respectively programs as temporary
organizations can be used for structuring the change.

Keywords
Project, Program, Change, Change Management, Change Roles, Project Roles,
Program Roles, Change Communication

1. Introduction

A “change” considers the whole identity of an organization, its result is a new,

altered identity [Gareis, 2008]. The establishment of change related roles and the
appropriate design of communication structures are essential for the success of
changes.

In changes specific change roles are required. The tasks and responsibilities of
change owners, change managers, change agents, etc. have to be designed
according to the change type. In 2nd order changes, change roles must be clearly
distinguished and related to project and program roles. Overlapping assignments of
different roles help to reduce complexity. Communication in changes is important
and essential, and its intensity differs for each change type.

In this paper, special focus will be given to roles and communication in changes. As
the tasks and responsibilities of change management roles may differ in each

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change type, as well as different communication needs exist, the paper will focus
on roles and communication in 2nd order changes.

2. Change

Levy and Merry [1986] differentiate between first and second order changes.
Second order changes are the change types „radical new-positioning“ and
„transformation“ (Gareis, 2010). The decision which type of change is looked at,
depends on the demand and potential for change [Gareis, 2010]. In consequence,
change phases can be identified and structured by processes. For the performance
of changes, projects and programs might be the appropriate organisations.

Figure 1 shows the processes for the change type “transformation”. The
transformation processes have to be performed in parallel to the daily business.
The transformation processes are performed by projects and/or programs.

Figure 1: Processes of the Change “Transformation” (Gareis, 2010)

The planning of the transformation can either be performed by a temporary

working group or by a project, depending on the complexity. The implementing of
the change as well as the stabilizing of the organization can be performed by one or
several projects or even by a program.

As the graph shows, in parallel to the transforming, the daily business is ongoing
and must be secured. When structuring change by projects and programs, the
establishment of project and program related roles, in addition to change
management roles, becomes necessary.

It is necessary to explicitly define change roles as integrative structures for the

performance of the overall change and to different those from program and project
roles. Program and project roles are required for the management of distinct
change programs or change projects, such as the planning of a transformation.

3. Change Management Roles in 2nd order changes

A change can be perceived as a chain of processes (see figure 1) and for the
performance of each change process an appropriate organisation, such as a
working group, a project or a program, must be defined. In consequence, it is
necessary to clearly distinguish between change roles, program and project roles.
(Stummer and Zuchi, 2010)

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a. Roles in 2nd order changes

For running changes professionally and assuring a continuous integration of all

projects and activities within a change, specific roles and communication structures
are required. Change management roles can be: Change Owner, Change Manager,
Change Agents, Change Team, Sounding Board, Change Consultant, etc. (Newton,
2007). These change management roles differ from the additionally to be
established project or program roles, in respect to objectives, tasks and
responsibilities.

In consequence the following roles might be differentiated:

Change management roles

 Change owner, change manager, change agent
 Change expert (organization expert, marketing expert, …)
 Change team
 Change management consultant

Program roles
 Program owner, program manager
 Program team member
 Program team

Project roles
 Project owner, project manager
 Project team member
 Project team

b. Role Descriptions “Change Management roles”

Change  Responsible for the strategic change management

owner  Responsible for the results of the change
 Definition of strategic requirements, making strategic
decisions
 Assignment of the change processes
 Authority to stop the change
 Marketing of the change
 Assurance of resources for the change
 Contribution in change projects and change programmes (as
owner/manager)
Change  Responsible for the operational change management
manager  Management of the change
 Assurance of the transition between sequential change
processes
 Assurance of compliance with change management
standards of the organisation
 Marketing of the change
 Dealing with resistance
 Contribution in change projects and change programmes (as
owner/manager/expert)
 Not: Content related decisions

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Change  Contribution in the change team

agent  Information of employees about decisions of the change
team
 Dealing with resistance
 Implementation of change measures in the organisation
 Contribution in change projects
Change  Further development of change management competences
management of the organisation
consultant  Gathering information, development of hypothesis, planning
of interventions
 Provision of analysis, observations, …
 Facilitation of meetings, workshops, documentations

Table 1: Role Descriptions “Change Management roles” (Stummer and Zuchi, 2010)

c. Role Descriptions “Program Management Roles”

Program  Responsible for strategic decisions

owner  Coordination of program and company interests
 Assignment of a program manager to perform the program
 Decisions about project-related issues which are beyond the
decision-making authority of the program team or the
relevant project owner and project manager
 Leading the program manager
Program  Responsible for the professional fulfillment of the program
manager management processes
 Realization of the program interests
 Ensuring the realization of the program objectives
 Leading the program team
 Representation of the program toward representatives of
relevant environments

Table 2: Role Descriptions “Program Management roles” (Gareis, 2005)

d. Role Descriptions “Project Management Roles”

Project  Responsible for strategic project decisions

owner  Assignment and approval of a project
 Realization of the project-related company interests
 Coordination of project and company interests
 Provision of context information
 Feedback to the project team on the (intermediary) results
 Leadership of the project manager
 Marketing of the project

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Project  Responsible for the project success, together with the project
manager team members and the project owner team
 Responsible for professional project management and for
adequate project marketing
 Realization of project interests and the project objectives
 Leadership of the project teams and the project contributors
 Representation of the project toward representatives of the
relevant environments

Table 3: Role Descriptions “Project Management roles” (Gareis, 2005)

e. Interrelationships and Differences between diverse Roles

The above described roles differ in their objectives and responsibilities. Change
management roles have to consider the overall change, whereas the program and
project related roles are responsible for the assigned program respectively project.
The change owner has a visionary view on the overall change and takes decisions,
that have consequences on the result of the identity of the overall company looked
at. The change owner is responsible for the results of the change, and thus for the
development of the company undergoing a change. The program or project owner
on the contrary is primarily responsible for the results of the respective program or
project and the herein defined results. A pre-requisite for the successful
cooperation within the change is a common view on the change by all roles, so that
possibly different objectives per interest groups might not lead to conflicts.
(Stummer and Zuchi, 2010)

Looking at the change manager, he or she is responsible for the entire change and
is in charge of the transitions between the projects and programs within this
change. Where the responsibility of the program or project manager ends, the
responsibility of the change manager takes over. To not lose energy throughout the
long lasting change, the change manager has to secure that when some phases in
the change have been successfully finished, the next phases (organized by a
project or a program) are assigned by the change owner, and the continuity is
assured. All managers have commonly no responsibility for the content but for the
process. They all need good communication skills and need to be able to convince
and lead people. The project managers will either report to the change manager or
– if established - to the program manager. The change manager is responsible to
report on the overall change (with the status of the single projects or programs) to
the change owner respectively the change agents. (Stummer and Zuchi, 2010)

4. Communication in 2nd order changes

As changes disturb established patterns and functions of social systems, the

systems might react with resistance. Resistance should be perceived as inherent
part of change, often enhanced by lack of adequate communication. Relevant
stakeholders do often not know, believe or understand that resistance is an
important factor in changes (Doppler, 2006), which makes appropriate
communication a success factor.

A change must be announced and explained. Communication can help to

appropriately inform those concerned by the change and to prepare accordingly for
the positive and or negative consequences. Though, communication might increase
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the understanding and commitment of the employees for the change. One further
objective of communication is that people are “moved” to change their attitudes
and behavior in favour of the change.

There are different communication structures and media to be established in 2nd

order changes, either to communicate within the change organization or to
communicate to the external, the relevant environments.

a. Communication within the change organization

At the beginning of the change, when having established the change management
roles, the necessary communication demand within the change organization shall
be agreed on. Communication media to be used for the communication within the
change organization are Email, Intranet, (Social) Events, etc. The communication
can be structured in regular intervals for ensuring the mutual exchange of
information, to keep the energy within the change team and to get decisions in
time.

The following table shows an extract of a list of possible communication structures:

Name Contents Participants Frequency

Change Information about the status Change owner Every second week
Owner in the change Change manager (eventually:
Meeting Ev. Change telephone
Taking strategic decisions management conferences with the
… consultant change manager or
change management
consultants)
Change Common development of the Change Team Once a month,
Team (Change
status in the change (Basis: lasting 0,5 days
Meeting progress reports by manager,
projects/programme) Change agents)
Change
Agreement on intermediate management
results consultants
…
… … … …

Table 4 “Communication Structures for the Change Management Roles”

Accordingly, the communication media and structures shall also be established

within eventually established program and project organizations for managing the
change.

b. Communication to relevant environments

On the basis of an environment analysis and the description of the environment

relationships, where the expectations towards the change show the necessary
communication intensity, a marketing plan can structure the required
communication from the beginning of the change to the end and thus provide
orientation for the change organization. The marketing plan may include

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information on the target groups, the decided communication media, the contents,
the dates, costs and responsible persons.

The communication media of 2nd order changes can be: Periodical company
newsletter, information folder, periodical questionnaires, image campaigns, events,
roadshows, vernissage, etc.

Supportive communication rules help to give orientation and to avoid the

generation of gossips through unstructured information spreading. Such
communication rules can be:
 All communication structures used are agreed in the change management
team
 Standard information material has to be applied (folder, PPT presentations,
etc.)
 Only contents already decided upon, shall be communicated
 Information shall not be provided too often, as this might reduce interest
 ….

An appropriate communication and marketing plan, accepted by the change

organization and supported by communication rules is one success factor of
changes.

5. Conclusions

One of the key success factors in changes is to define the appropriate roles needed
for the change, as well as for the project(s) respectively program(s) herein. The
objective of this paper was to contribute to the understanding of change roles and
their clear differentiation from program and project roles.

The change roles required for 2nd order changes, such as “transformation”, are the
“change owner”, the “change manager”, “change agents” and “change experts”.
The objectives and tasks of these roles can be described. In these descriptions the
relationships to other roles can be mentioned.

The change owner is responsible for the strategic management of a change. He

defines the strategic requirements, makes strategic decisions, assigns new change
processes, and has the authority to stop a change process. Persons performing the
role change owner can contribute to change projects and change programs as
owners or managers.

The change manager is responsible for the operational management of a change.

He assures the transitions between change processes and the compliance with
change management standards and performs change marketing. Persons
performing the role change manager can contribute to change projects and change
programmes as owners or managers or experts.

Change agents are responsible for the interaction with the employees of the
organization and the implementation of change management measures in the
organization. This includes the dealing with resistance. Change experts provide
expertise for the fulfilment of the change. They usually act also as project
managers or as team members in change projects.

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Furthermore, adequate communication structures within the change organization

give orientation to all people involved and communications with relevant
environments raise acceptance for the change.

6. References

Doppler K. (2006), “Change-Management – eine Standortbestimmung“ in:

„Hernsteiner“; 2/2006
Gareis R. (2005), „Happy Projects!“, Manz Verlag, Vienna
Gareis R. (2008), „Changemanagement und Projekte“ in: Wald A, editor. Advanced
project management. Berlin: Lit Verlag
Gareis, R. (2010), “Changes of organizations by projects”, International Journal of
Project Management, 28(4)
Levy A., Merry, U. (1986), “Organizational transformation: approaches, strategies,
and theories”, Praeger Publisher, New York
Newton, R. (2007), “Managing Change Step By Step”, Prentice Hall
Stummer, M., Zuchi, D. (2010), “Developing Roles in Change Processes. A case
study from a Public Sector Organisation“, International Journal of Project
Management, 28(4)

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_|áà Éy ctÜà|v|ÑtÇàá
Adamopoulou Iliana National Technical University of Athens, Greece
Akrivos Charalampos Hellenic Army, Engineering Dept., Greece
Anagnostopoulos Ioannis PM-Greece, Greece
Anastasiou Maria Kounna Bros. Enterprizes Ltd., Cyprus
Antoniadis Dimitris Carillion Ltd & PM-Greece, UK
Antoniou Fani Egnatia Odos S.A. & PM-Greece, Greece
Antzoulides Dimitris Hellenic National Audiovisual Archive, Greece
Armstrong Steve The Open University, UK
Bajracharya Arun The British University in Dubai, United Arab Emirates
Bakogiannis Antonios PM-Greece, Greece
Bellos Evangelos National Technical University of Athens, Greece
Bidstrup Georg Dong Energy, Denmark
Bolsius Ruud IPMA, The Netherlands
Bopp Peter Arizona State University, USA
Boulogiannis Konstantinos Freelance Civil Engineering & PM-Greece, Greece
Bras Ioannis Superior Services, Greece
Brilakis Ioannis Georgia Tech, USA
Cable John A. James Clark School of Enineering & IPMA, USA
Chassiakos Athanasios University of Patras, Greece
Chatzidakis Nikolaos Civil Engineer, Greece
Chea Sovann Ministry of Health for the Global Fund Programs in Cambodia,
Cambodia
Chileshe Nicholas University of South Australia, Australia
Chinyio Ezekiel University of Wolverhampton, UK
Dandolou Niki National Technical University of Athens & PM-Greece, Greece
Depountis Nikolaos Aktor S.A. & PM-Greece, Greece
Domkute Jovita Ministry of Economy of the Republic of Lithuania, Lithuania
Drimoussis Christos MOU of Development Programmes S.A & PM-Greece, Greece
Edum-Fotwe Francis Loughborough University, UK
Emiris Dimitrios University of Piraeus & PM-Greece, Greece
Fotopoulou Dionisia Cosmos Project Management, Greece & PM-Greece, Greece
Fragkakis Nikolaos National Technical University of Athens, Greece
Freire Zaida CGD, Portugal
Fupei Qian IPMA, China
Galaras Konstantinos Civil Engineer MSc, Greece
Gareis Roland Vienna University of Economics & Business Administration &
RGC, Austria
Gasa Bridgitte Nelson Mandela Metropolitan University, South Africa
Georgakopoulou Persefoni PPCR, Greece
Georgiou Loukia National Technical University of Athens, Greece
Grau Nino IPMA, Germany
Grigoraviciene Renata Ministry of Economy of the Republic of Lithuania, Lithuania
Hang Tauno Tallinn University of Technology, Estonia
Hanna Awad University of Wisconsin-Madison, USA
Hen Sokunkolroth Ministry of Health for the Global Fund Programs in Cambodia,
Cambodia
Hok Chantheasy Ministry of Health for the Global Fund Programs in Cambodia,
Cambodia
Iatropoulos Athanasios Egnatia Odos S.A., Greece
Issaias Babis Polis Park S.A. PM-Greece, Greece
Janssens Christianne IPMA, The Netherlands
Kagioglou Mike University of Salford, UK
Kalamarakis Stefanos Michael M. Tsontos S.A.& PM-Greece, Greece
Kalyviotis Nikolaos Aristotle University of Thessaloniki, Greece
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Karavata Florentia E.P.E.A.E.K., Greece

Kashiwagi Dean Arizona State University, USA
Kassim Yahuza University of Salford, UK
Katsanis Constantine Ryerson University
Katsarelis Triantafyllos National Technical University of Athens & PM-Greece, Greece
Kirytopoulos Konstantinos University of the Aegean, Greece
Kiss Julia IPMA, Austria
Kontostavlakis Dionisios University of Piraeus, Greece
Kotsiori Panagiota PM-Greece, Greece
Langford David Glasgow Caledonian University, UK
Laoutaris Pavlos MOU S.A. & PM-Greece, Greece
Malisiovas Andreas Aristotle University of Thessaloniki, Greece
Manoliadis Odysseus Democritus University of Thrace & PM-Greece, Greece
Marakis Ioannis T.E.E./ T.A.K., Greece
Maravas Alexandros National Technical University of Athens & PM-Greece, Greece
Marinelli Marina National Technical University of Athens, Greece
Markoulidis Panagiotis Omikron5 Ltd. & PMI, Greece
Masrom Asrul Queensland University of Technology, Australia
Mathioudakis George AEGEK Construction S.A., Greece
Milosevic Gzegoz Ministry of Economy of the Republic of Lithuania, Lithuania
Mlinaric Vjeran University of Zagreb, Croatia
Mori Roberto IPMA, Italy
Moutsopoulou Amalia Technological Educational Institute of Crete Greece
Olatoye Charles University of Manchester, UK
Or Vandine Ministry of Health for the Global Fund Programs in Cambodia,
Cambodia
Orsini Annabella IPMA, Italy
Panagiotakopoulos Demetrios Democritus University of Thrace & PM-Greece, Greece
Panas Antonios National Technical University of Athens & PM-Greece, Greece
Pantouvakis John-Paris National Technical University of Athens & PM-Greece, Greece
Papadaki Maria University of Manchester, UK
Papadopoulos Theofilos Hellenic Open University, Greece
Papageorgiou Loukas PM-Greece, Greece
Papari Eleni National Technical University of Athens, Greece
Pells David PM Forum, USA
Perera Nihal University of Salford, UK
Polat Gul Istanbul Technical University, Turkey
Polychronakis Yiannis University of Salford, UK
Radujkovic Mladen IPMA, Croatia
Roehborn Dirk Communardo Software GmbH, Germany
Schadden Brigitte IPMA, Austria
Shannon David Oxford Project Management Ltd., UK
Shepherd Miles Bournemouth University & IPMA, UK
Skibniewski Miroslaw University of Maryland, USA
Sutrisna Monty University of Salford, UK
Taylor Tom Buro Four, dashsot & APM, UK
Tezias Evangelos Civil Engineer, MSc, Greece
Theofanidis Konstantinos Hellenic Petroleum S.A. & PM-Greece, Greece
Theofanidou Katerina PM-Greece, Greece
Tovb Alexandr SOVNET & IPMA, Russia
Tsallas Spyridon Hellenic National Audiovisual Archive, Greece
Tsimopoulou Vaia Delft University of Technology, The Netherlands
Tsipes Gregory IBS, Russia
Tzaveas Theodoros Egnatia Odos S.A., Greece
Valila Veikko IPMA, Finland
Vukomanovic Mladen Croatian Association for Construction Management, Croatia
Wirkus Marek Gdansk University of Technology, Poland
Xenidis Yiannis Aristotle University of Thessaloniki, Greece

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Zapounidis Konstantinos Pieriki Anaptixiaki S.A. & PM-Greece, Greece

Zuchi Dagmar Roland Gareis Consulting, Austria

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