Advanced Construction Training

Academy
BTEC HND in Quantity Surveying
Assignment
Name of
the Unit

CODE LEVEL

Name of the Student L.B.S.Kalpani

Student Center Ref. No.

EDEXCEL Registration No. HD39818

Semester Semester 1

Name of the Assessor

Assignment Submission Date

1
 Assessment Criteria
Assessment Criteria for Pass Possible Evidences Task No Page number Achieved
To be filled by Y/N
the learner To be filled by the
assessor
LO 1
Develop an understanding of the principles of management, the work of pioneers and
founders of management, their evolution and application to modern day practice

P1 Define and attribute three established Define and attribute three established 1.1
definitions of management definitions of management
P2 Explain the principles and processes of Explain the four management functions of any
management: forecasting, planning, selected large-scale Construction Company 1.2
organizing, motivating, controlling, operates Sri Lanka and its process of
cocoordinating and communicating management. You are required to adequately
explain forecasting, planning, organizing,
motivating, controlling, co-coordinating and
communicating along with the existing
problems, valid suggestions to improve
management process of that construction
company. Evidences are to be provided to
support your answer. (Ex: Organization Charts,
Flow charts etc.)

2
P3 Explain the motivational needs of individuals and Motivation plays a vital role in achieving of 1.3
groups leadership styles and concepts of team organizational success. Define motivation and
working explain motivational needs of individuals and
groups, leadership styles, team working in
relation to selected large scale Construction
Company. Evidences are to be provided to
support your answer. (Ex; Types of teams,
responsibilities and composition)

LO2
Demonstrate knowledge and understanding of the Industry‟s markets and activities, the roles of the professions/disciplines in project teams and the
management principles appropriate to organizations within the industry
P4 Describe in outline the main markets, Explain main markets, activities and service 2.1
activities and services provided by the provided by the construction and built
construction and built environment sector environment in Sri Lanka.
P5 Describe the roles of the different Describe the roles of the different 2.2
professions/disciplines within the design, professions/disciplines within the design,
Construction and installation team. and the Construction and installation team and the main
main cycle of work activity cycle of work activity your selected company
or project undertaken.
P6 Produce an organization structure that Explain the existing organizational structure of 2.3
incorporates examples and explanations of your company with graphical presentation and
direct line, lateral, functional and staff elaborate the direct line, lateral, functional, staff
relationships and also explain with examples, relationships span of control, Chain of
span of control, chain of Command, Command, Centralized versus decentralized,
and job design within the structure. Evidences
centralized versus decentralized, and job
are to be provided to support your answer (Ex:
design
Organizational Chart).

3
P7 Compare project based organizational Compare project based organizational 2.3
structures structures with other organizational Structures.
You are required to explain advantages and
disadvantages in both Structures
P8 Define and explain the purpose of a mission Compare project based organizational 2.4
statement, strategy, corporate planning, structures with any other three organizational
policy and objectives to the activities of a Structures and explain advantages and
practice or firm disadvantages in each Structure
P9 Evaluate the influence of the scale and size Covered by the class room activity
of contract, type of client, project/contract
procurement method, and function of the
organization, ie main contractor/sub
contractor, designer, supplier, etc on the way
business is organized and managed

Assessment Criteria for Merit Possible Evidences Task No Page number Achieved
To be filled by Y/N
the learner To be filled by
the assessor
M1 Identification and application of strategies An effective approach to study and research 1.2
to find appropriate solutions. has been applied

Effective judgments have been made

4
 selection and application of strategies to Relevant theories and techniques have been 1.3
M2 find appropriate methods /techniques applied
A range of methods and techniques have
been applied
A range of sources of information has been

Assessment Criteria for Distinction Possible Evidences Task Page number Achieved
No To be filled by Y/N
the learner To be filled by the
assessor
D1 the use of critical reflection to evaluate Conclusions have been arrived at trough synthesis 1.2
own work and justify valid conclusions of ideas have been justified. 2.5
Self criticism of approach has taken place
Realistic improvements have been proposed
D2 take responsibility of managing and Activities have been managed 2.5
organizing activities has been recognized and achieved 1.2

5
Table of Contents
Assessment Criteria................................................................................................................ 2
ACKNOWLEDGEMENT ......................................................................................................... 8
ASSIGNMENT INTRODUCTION ........................................................................................... 9
Assignment Scenario................................................................................................................ 10
TASK NO.01 ........................................................................................................................... 11
LO 1 ......................................................................................................................................... 12
Develop an understanding of the principles of management, the work of pioneers and
Founders of management, their evolution and application to modern day practice ............ 12
Task 1 ....................................................................................................................................... 12
ANSWERS............................................................................................................................... 13
Establish Definitions of Management .............................................................................. 14
Motivational needs of individuals and group in construction and build environment ..... 24
TASK NO.02 ........................................................................................................................... 26
LO 2 ..................................................................................................................................... 27
Demonstrate knowledge and understanding of the Industry’s markets and activities, the
roles of the professions/disciplines in project teams and the management principles
appropriate to organizations within the industry ................................................................. 27
Task 2 ................................................................................................................................... 27
ANSWERS............................................................................................................................... 28
Organization Structures.................................................................................................... 48
Project Based organization structure................................................................................ 59
REFERENCE ........................................................................................................................... 64

6
7
ACKNOWLEDGEMENT

First and foremost, it’s with deep sense of respect and heartfelt gratitude that I extend my
appreciation to my Management Principles and Application module lecturer, Mrs. Ishika
Gunasekara for her invaluable guidance, encouragement, and kind advice provided during the
period of the module.
I also extend my sincere thanks to ACTA for gave me supported in many ways to complete
my assignment successfully.
Finally, my profound and wholehearted is sincerely extended to my parents, sister, brother
and my friends for their kindness strength and assistance which encouraged me during my
study and throughout my lifetime.

8
 ASSIGNMENT INTRODUCTION
In aim of increase the profit of construction Quantity Surveyor is appeared. Now it was a
successful job. Quantity Surveyor like a heart of the construction. He stays with the project
start to the end. Because he is the person who earn the profit for the company.
To do this job the most important part is management principles. Because it is included with
the valuable parts such as cost planning, cost controlling, cost monitoring and maintain the
cash flows.
The cost of a project can be reducing in many ways. If we manage materials at site, plants
and labors in the site and the subcontractors in a proper manner can complete the project in a
suitable cost, minimum time, high quality and in a splendid way.

Objectives
Identify the reasons difference between actual cost and an estimated cost.
To aware how apply the cost controlling, cost planning and the monitoring the cash
flow forecast to minimize the cost
To know about the methods how manage the labor, material, plant and subcontractors
on the site
To get an idea about government intervention to the construction project
To identify how manage the sustainable construction and environmental management.

9
 Assignment Scenario
The Government of Sri Lanka has taken a policy decision to upgrade the infrastructure
facilities in the country as to achieve economic growth targets. In developing those facilities,
the local as well as foreign construction companies are invited to share the technology and
the capital flows with the state construction sector of the country. By adhering to the
government policy, many overseas constriction companies already entered to the construction
industry of Sri Lanka and they are engaging in expanding their business by setting up new
business formations including joint ventures and strategic alliances with the local
construction companies in Sri Lanka. „‟X‟‟ construction company PLC is one of the large-
scale local construction company and „‟ Y‟‟ construction Indian PLC is planning to start a
joint venture to construct a new highway project in Sri Lanka. The company that you are
employed is also planning to join with overseas company to undertake a massive construction
project in Sri Lanka.

Types of teams, responsibilities and composition). ((P3)

10
TASK NO.01

11
LO 1
Develop an understanding of the principles of management, the work of
pioneers and Founders of management, their evolution and application to
modern day practice

Task 1

1.1 Define and attribute three established definitions of management. (P1)

1.2 Explain the four management functions of any selected large-scale construction company
operates Sri Lanka and its process of management. Adequately explain forecasting,
planning, organizing, motivating, controlling, co-coordinating and communicating along
with the existing problems, valid suggestions to improve management process of that
construction company. Evidences are to be provided to support your answer. (Ex:
Organization Charts, Flow charts etc.). (P2, M1, D1)

1.3 Motivation plays a vital role in achieving of organizational success. Define motivation
and explain motivational needs of individuals and groups, leadership styles, team
working in relation to any selected large-scale Construction Company. Evidences are to
be provided to support your answer. (Ex;

12
ANSWERS

13
 Task 01

(1.1)
Establish Definitions of Management

 According to Peter Drucker,

"Management is a multi-purpose organ that manages business and manages managers and
manages workers and work."
This definition of management was given by Peter Drucker in his book "The Principles of
Management".
Constructions Company has to focus on the management of business, workers, work and
managers. Out of this first and foremost the workers should be managed by changing their work
and giving them benefits to motivate them. Then it needs to focus on its work and arrange the
work accordingly so that it is easy for the workers to follow by dividing work, innovating
different methods of getting work done, changing the work environment. These things will not
only make the work easier and good quality but it will affect the employees to benefit the
company where their productivity increases.

 According to Mary Parker Follet,

"Management is the art of getting things done through people."
Company need to focus on its employees. The main focus would be to increase productivity of
the employees. In order to increase productivity, they need to pay attention how the staff proceeds
with their work. If the work is too large for the employee to do by themselves, it is wise
according to Mary Parker Follet to divide and share the work with sub staff. This in turn will be
the „usage of others to get work done‟. The complete management of the company must be
revised to make all the workers work as a team thus increasing the productivity and the change in
environment. A change of the environment will help the workers love their job thus reducing
labor turnover and increasing productivity of the workers.

14
  According to Henri Fayol,
"To manage is to forecast and to plan, to organize, to command, to co-ordinate and to
control."
Henri Fayol gave this definition of management in his book "Industrial and General
Administration".
Company needs to know where they were in the past, where they are in the present and project
into the future to predict where they want to be.

15
(1.2)

Management Process
There are six general areas which Fayol developed have been become known as the process of
management, which we still use and refer to today. Communication is included recently for this
process.
 Forecasting
 Planning
 Organizing
 Motivating
 Controlling
 Co-coordinating
 Communicating

Forecasting
Forecasting is to look a head into the future and predict possible trends or occurrences which
are likely to influence the working situation. Simply mean of forecasting is make the future
process based on past and present data. It gives the information about future events and the
consequences for the organization.
This is helps to management in its attempts to marched with the uncertainty of future, relying
mainly on data from the past and present and analysis of trends.
Forecasting is starts according to some assumptions it’s are, knowledge and judgment. These
are projected in to the future.
Normally in the construction field personal planning embraced all future positions, from
minor staff to project manager. Mostly the future arrangements are done by according to
forecasting theory.
Forecasting can divide into three levels. They are:
 Financial forecasting (capital- estimating costs)
 Workload forecasting (tendering –depend on the project type and size)
 Resources forecasting (best resources- human resources, material / buying hiring the
plant, labor, materials & staff)

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Forecasting for construction firm, normally carried out in two levels:
 Senior Management- the construction firm directors will forecast at macro level,
looking at the future trends in the industry over the next 5-10 years.
 Middle/Lower Management- forecasting will be carried out at both macro level,
forecasting the company’s work load over the next year and also in a project specific
sense, which is often related to, cash flow, construction techniques, material delivery,
the weather or the availability of particular skills or plant…

Planning
Planning is the heart of all the functions of management because it serves as primary requisite
of every management functions whether it is organization, staffing (process of matching the
jobs), directing (essential Components-Issuing of instruction and orders, guiding the people,
supervising the people/ involves with leadership, communication, motivation and
supervision), coordinating, controlling.
Basically it is economic, rational and systematic way of making decisions today which will
reflect the future. It is involving the selection of objectives, policies, procedures and
programme for attaining the enterprise’s goals. It is concerned with, what work has to be
done, where it will be done and how it will be done, when it will be done and by whom it will
be done. It is very powerful tool in decision making and forecasting. It’s very essential also
for utilizing the available resources (men, material, machinery, plant, money) to the best
advantage.
The construction planning of a project must consider the wide range of aspects involved with
the Site investigation, market survey, bidding the works, post-tender negotiations and
agreement, planning for the works (including the mode of construction and supervision, and
the requirement of men, material, machinery and the money).
In construction company need to plan in varying time scales, so company’s or the
construction’s Planning documentation will include:
 Strategic Planning
 Management Planning
 Operational or Tactical Planning

17
Types of General programs are:
 Pre-tender Programme
 Pre-construction Programme
 Master Programme
 Monthly Programme
 Weekly Programme

These Planning Documents and General Programs are based around the Company’s future
development.
The first step in planning is the selection of goals for the organization. Goals are then
established for each of the organization’s subunits-its divisions, departments, and so on. Once
these are determined, programs are established for achieving goals in a systemic manner.
Elements of planning:
 Always concerned with the future
 Involves a predetermined course of action
 Course of action will determine after a careful study of alternative courses
 Continuous and integrated process
 Always it dimensions of time
 Main object is to achieve better results in the most economical way consuming
minimum time possible

Organizing
 The process of engaging two or more people in working together in a structured way
to achieve a specific goal or set of goals.
 Organizing is the process of arranging and allocating work, authority, and resources
among an organization’s members so they can achieve the organization’s goals.
Organizing of a project mean technical and managerial personnel effectively use the
available resources in such a stipulated time and the budget.
 Whenever services of more than one person are required to achieve enterprise
objectives, problem of assigning duties and delegation of authority of the different
personnel arise. Organization function primarily deals with identifying and grouping
the work to be performed, defining, delegating responsibility and authority and
establishing relationship for the purpose of enabling people to work most efficiently
together in accomplishing objectives.

18
It involves certain pattern of relationship of authority and responsibility among the members
of groups, so that is the work performed with speed, accuracy and the economy to achieve the
organizing objectives.
Process of Organizing:
1. Determination of objectives
2. Division of activities
3. Fitting in individuals into jobs
4. Developing of relationship

Organization may be described as the backbone of management. Without the efficient

organization, no management can be performing its function satisfactory. Sound organization
can be contribute considerably to the success of enterprise by:
 Facilitating achievement of objectives of enterprise

 Facilitating optimum use of resources and technology

 Stimulating the creativity and innovation

 Facilitating the growth and diversification

 Facilitating the effective communication

 Encouraging cordial relations between the management and workers.

Organizing helps in awarding the contract to the best and efficient contractor because the
network of the project furnished by the contractor along with the tender is the mirror image of
the resource capacity of the contractor and the methodology of the project.
Organization needs effective planning. Organization can be defined as the pattern of ways in
which a large number of people engage in a complexity of tasks, relate themselves to each
other in systematic establishment and accomplishment of mutually agreed purpose.
Functions of organizing
 It establishes pattern of relationship by giving duties and responsibilities to individual
or group.

 It provides adequate communication.

 It demarcates the authority, duties and responsibilities of each individual or group.

 It coordinates or integrates and controls the activities of individual or group to achieve

common objectives of the business enterprise or the construction project.

19
Therefore, it evident that an organization for the construction contracting has to be built
taking into account the general principles of management, need of accountability and the
special characteristic of the construction industry.
For managing the human resources in construction company or the company use
Organization Structures or chart.

Motivation
The factors that cause channel and sustain an individual’s behavior. Motivation is the word
derived from the word ‟motive‟ which means needs, desires, wants or drives within the
individuals. It is the process of stimulating people to actions to accomplish the goals
Motivation is effective instrument in the hands of management in inspiring the workforce to
achieve company’s objectives effectively and efficiently. It is major task of every manager to
motivate his subordinates. (to create the “will to work” among subordinates). It should have
remembered in this context that a worker may be immensely capable of doing some work,
nothing can be achieved if he is not willing to work. In that reason, creation of a will to work
is a must Motivation is core of management.
In order to motivate the workers to their work for organization goals, manager must
determine various needs of workers and provide an environment in which appropriate
incentives (consisting both financial and non-financial incentives) are available for their need
satisfaction. This will be increase efficiency and effectiveness of the organization. There will
optimum utilization of resources and worker’s ability and capability.
Higher motivation lead of job satisfaction of the workforce which can reduce absenteeism,
labor unrest etc. moreover, the workers will be more committed to the organization which in
turn helps in developing better industrial relations in the enterprise.

Motivation Factors:
• Economic- job continuity, wages, job security, future prospects & pensions

• Social- work environment, relationship with other employees/ supervisors

• Creative- job satisfaction, achievement

There are many motivation theories. “Each motivation theory attempts to describe what
human beings are and what human beings can become. For this reason, it is customary to say
that a motivation theory has content in the form of a particular view about people. The

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content of a motivation theory helps us understand the word of dynamic engagement in which
organizations operate by depicting managers and employees engaging in organizations every
day.
According to this construction company motivation is much needed because the owner of the
company pays less attention for his workers and as a result of that productivity dramatically goes
down. If there is a motivation happening it can change the situation up to some extent.

Controlling
Control consists in verifying whether everything occurs in conformity with the plans adopted,
instructions issued and principles established. It has point out weaknesses and errors in order
to rectify them and prevent recurrence. It operates on the both human and non-human
resources. Checks and the examinations are required on periodic basis to ensure that orders
are not misunderstood, the rules are not violated and objectives have not been unknowingly
shifted or lost sight of it. It is continuous process. So, control is important function of the
management. Control function follows three basic steps:
1) Establishing Standards
Different standards of performance are setup for various operations at planning stage which
serve as basis for any control system. Establishment of the standards in terms of quality,
quantity or the time is necessary for effective control because it is essential to determine how
the performance is going to be appraised.
Standards may be of the physical nature (units, man hrs.….), monetary nature (sales, revenue
expenses….) and may be the intangible nature (reputation of the firm …). But all the
standards should be accurate, acceptable, precise and the workable. Standards should be
flexible also capable of being changed when the circumstance so require.
2) Appraising Performance
This step involves measuring of actual performance of various individuals; group or the units
and then comparing it will standards which have already been set up at planning stage. So
appraisal helps to reveal amount of deviation from standards and investigate the causes of
such deviation.
3) Taking Corrective actions
Final step in control process is taking corrective actions so that deviations may not occur
again and objectives of an organization are achieved. If standards are found defective they
may be modified in the light of observations

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So when in the construction firm controlling is complementary to the planning process. Once
scheduled plan has been prepared and execution commenced, control over progress has to be
exercised in order to complete the project by stipulated date.
Controlling involve comparing at regular intervals, actual achievement with desired
achievements of original plan. It is seen; some activities are head of the schedule and indicate
that these activities possess enough resources. Some activities are going on schedule and it
gives ideas that activities possess adequate resources but some activities are going behind the
schedule and its gives the signal of deficiency of resources and this indicate warning to the
construction engineer to pay the serious attention on these activities. Engineer is required to
diagnose illness of activities under question and detailed study of activity performance will
indicate particular resources (skilled labors, equipment, material, etc…) is lacking and
causing delay of activity. Engineer is supposed to supplement particular resources so that
necessary corrective steps are applied to bring back the project on schedule as far as possible.
Controlling requires an upward flow of information through a suitably designed reporting
system. Information so fed is analyze and the project plan is brought up to date with
necessary variations. Thus it seen that the construction planning and management network is
an important aid for controlling the project.

Co-ordination
The process of coordination involves synchronizing individual efforts with the goal of
enterprise. Today’s organization has grown in size and character. A large number of people
work their in. so, in that reason coordinating has become very pertinent in achieving harmony
of individual actions towards accomplishment of company objectives.
Proper coordination is critical to the success of construction projects. The relevant studies
have addressed the frequency and information quality of the communication, but their
combination and contribution to the effectiveness of coordination methods need to examine.
This paper explores two variables that affect coordination effectiveness: quantity and the
quality, as well as their relationships with coordination effectiveness and the project
performance.
The analysis results indicated that coordination quality is more related to coordination
effectiveness (and indirectly to project performance) than coordination quantity. Projects that
performed well had better coordination effectiveness than projects that performed poorly. It
was also found that engineers could spend less time on written correspondence, plans and
procedures, and reports without reducing their effectiveness.

22
Ineffective coordination between different functions of business enterprise, like production,
sale, administration. can be ruin.

Communicating
The process by which people attempt to share meaning via the transmission of verbal and
nonverbal messages
"It is a process which involves the transmission and accurate replication of ideas ensured by
feedback for the purpose of eliciting actions which will accomplish organizational goals".
Communicating is the process by which ideas are transmitted, received and understood by
others for the purpose of effecting desired results. Medias of the communication may be like
numerous like verbal, reports, writing orders, instructions etc. as business organization has
continuity, process of communication largely depends upon the proper understanding of what
is being communicated and what is being received and then responded.
Ineffective communication leads to confusion, misunderstanding, dissatisfaction and
sometime even strikes.

In that task, I selected MAGA as the large scaled construction company.

Risk management process in MAGA

Strategies of the risk management are discussed at the monthly progress review meetings
chaired by the board of directors. The meetings promote open discourse with respect to
identifying major risks and mitigation measures. They take into consideration risks in
operation as well as the risks in venturing in the new projects. It also offers a forum for the
senior management to discuss project based operational strategies in risk management, based
on the precautionary principle to protect the employees, end users and other stakeholders
from plausible risks and exposure to harm.

The risk management process is complemented by the audit and compliance and project
review committees, who have been given guidance to prevent or mitigate potential risks
through a combination of internal controls and swift decision making.

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(1.3)
Motivational needs of individuals and group in construction and build environment

In simple motivation is the force that compels us to an action. Motivation influences behavior
and ability to accomplish goals.
It is defined as:
“Internal and external factors that stimulate desire and energy in people to be
continually interested and committed to a job, role or subject, or to make an effort to
attain a goal.”
(Motivation Definition)
Motivation outcomes from the interaction of both conscious and unconscious factors.
There are different forms of motivation; each form influences behavior in different ways. No
one way of motivation works for every individual therefore motivation changes according to
a person’s personality.
Forms of motivation are:
 Incentive: form of motivation that involves rewards

 Fear: involves in consequences used when incentive motivation fails.

 Achievement: a drive to be competent, achieving goals and tackling challenge

 Growth: need for self-improvement

 Power: desire to control or be higher than others

 Social: desire to belong and be accepted

 Expectations: expectation by individuals or peers

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 Figure 1:

Performance of the board of directors in MAGA

The board undergoes performance appraisal in the following area:
 Its engagement with stakeholders on critical issues
 Development of cooperate strategy based on above engagement
 Implementation of the aforementioned strategies
 Its effort to direct, monitor and develop senior management
 Effectiveness of its efforts in corporate governance
 Overall performance of the company

25
TASK NO.02

26
LO 2

Demonstrate knowledge and understanding of the Industry’s markets and

activities, the roles of the professions/disciplines in project teams and the
management principles appropriate to organizations within the industry

Task 2

Assume that you are employed as a manager and you are required to support with your
theoretical and practical exposure in managing company.

2.1 Explain to a construction team members about main markets, activities and service
provided by the construction and built environment in Sri Lanka (P4)

2.2 Describe the roles of the different professions/disciplines within the design, construction
and installation team and explain the main cycle of work activity in your construction
company or any project undertaken.
(P5)

2.3 Explain the existing organizational structure of your selected company with graphical
presentation and elaborate the direct line, lateral, functional, staff relationships span of
control, Chain of Command, centralized versus decentralized, and job design within
the structure. Evidences are to be provided to support your answer (Ex:
Organizational Chart). (P6)

2.4 Compare project based organizational structures with any three organizational structures
and explain advantages and disadvantages in each structure. (P7)

2.5 Define mission statement, strategy, corporate planning, and policy, objectives with the
examples related to selected company. A detailed analysis of problems in the
strategies along with recommendations of the most suitable strategies are to be
provided by considering the construction and built environment in Sri Lanka.
Evidences are to be provided to support your answer (Ex: mission statement of
selected company, policies and objectives and strategies). (P8, M2, D2)

27
ANSWERS

28
 Task 02

(2.1) Main Markets, activities and services provided by the construction and built
environment sector
Main markets
A market is an environment that allows buyers and sellers to interact (directly or through
intermediaries) to trade products and services. A market is any place where a transaction is
made and operates on supply and demand.
Any market includes these means or mechanisms:
a) Determining the price of the traded item

b) Communicating the price information

c) Facilitating deals and transactions

d) Affecting distribution

The main parties involved are buyers and sellers. Physical markets are available but with the
development of technology there exists E-markets. The market for a specific item is made up
of existing and potential customers who need it and have the ability and willingness to pay
for it.
Construction market
The construction market is one of the leading markets in the world and serves as a benefactor
to the rise in economy. To aid the needs of the change in countries various new and improved
constructions such as:
 Dams,
 Bridges,
 High rise buildings; apartments, shopping complexes, hotels, resorts,
 Factories: textile, tea, rubber, recycle,
 Highways,
 Runways,
 Railways,
 Airports,
 Harbors,
 Schools,
 Hospitals,

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  Court houses,

 Prisons and jails,

 Plants; water, power, waste,

 Parking structures

 Office buildings are introduced by the construction industry.

In a construction industry we find the construction market. This is vast market in any country
as opportunities are present in a range of works.
 Construction market consists of the following markets:
 Civil & Transportation
 Industrial
 Power
 Water treatment
 Government
 Education
 Commercial

 Healthcare and laboratories

All these markets involve in building the above mentioned constructions. The new
opportunities that are presented by clients on what they want to build are the main idea of a
construction market. The most important factor is the client. The client could be anyone
ranging from private organizations, a private client, the government, a governmental
organization. The client is mainly anyone with the money or financial stability. The other
important party is a construction company.
There are other markets that give aid to the construction market. These markets are as
follows:
 Infrastructure market

 Customer market

 Labor market

 Material market

30
  Equipment market

 Technical market
Infrastructure market
Infrastructure is the elementary physical and organizational structures wanted for operation of
a country or society or the facilities essential for economy to function. Infrastructure market
is the market is the opportunity to build these structures.
Examples of infrastructure are s follows:
 Roads,

 Bridges,

 Water supply,

 Sewers,

 Electrical grids,

 Telecommunications,

Infrastructure market is one of the main markets that aid a country to development which is
considered as a massive market which involves large projects. Like in the construction
market infrastructure market also contains cliental both private and public. The main
examples cliental are the government and the private organizations.

Customer market
Customer market contains products and services for consumers. In general, the market
provides consumers with relevant services. Most construction companies pay a large amount
of attention on the customer market as they are constantly in search for new clients to fund
new projects. A customer markets foundation rests on the main notion of good quality
services and products. This market is the main market which is involved in the commencing
of a new project. Customer market makes a larger impact on the construction industry and is
considered as a structured business method for finding, making, keeping and developing
profitable customers.
Main factors to consider in this market are:
 Market growth strategy

 Experience

 Product and service

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  Pricing excellence

 Sales and marketing excellence

 Quality

 Guarantee

 Customer relationships

Labor market

“Labor market is an area of economic exchange where workers seek jobs and employers
seek workers. A “tight” labor market has more jobs than workers. In a “slack” labor market,
the reverse is true.”
The basic concept of a labor market is a place where employees find paying jobs and
employers seek skilled or professional employees for pay. Labor market is a very competitive
market where people are constantly fighting to get jobs or fighting to get skilled labor. The
main factors that determine whether a job is taken by an employee or given by an employer
are money and skills.
The more skilled a person is the better opportunities of getting a better job and the more
money a company is willing to offer the better they can recruit new employees.
There are many issues with the labor market many include; unemployment, employment,
participation rates and wages. In the modern days there is an increasing aging work force
where many people are willing to take up paid work after retirement. Labor markets provide
the structure through which workers and employers interact in relation to jobs, working
conditions and pay.
The most important factor is to find necessary labor for construction projects. The main jobs
in the construction labor market are: engineers, architects, contractors, managers and quantity
surveyors. There is a good labor market in places where construction can occur like Middle
East countries and Australia.

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Material market
This market involves in that buying and selling of materials. It is a very important market to
the construction market because it helps the in the building of projects. We can refer to it as
the foundation of any project. Without knowing where to get materials it is hard to do a
project therefore it is very important. In this market a major detail that is searched for is
quality of product. It is very important to have a good quality material as the whole
construction project depends on it explicit quality. Good quality material has the highest
demand and has a higher value. Many quality materials are commonly found in developed
countries such as England and USA.
The main material that has a market for itself is the concrete market. This is the most used
material and there are different types of concrete and different brands.

Equipment market
This is another important market, this involves in the buying and selling of equipment needed
for construction. Here again the need for better quality and stat of the art equipment is always
the major issue. The better quality materials also are very expensive therefore durable and
inexpensive equipment are the main attractions in this market. The producers of equipment
also have the important duty of making high quality, state of the art equipment which is
inexpensive and must be durable. Equipment clearing these criteria are mostly found in
developed countries the markets are very expensive and very far therefore many construction
project companies settle for second best.

Technical market
This is the market to obtain technical knowledge. As the technology changes there is a need
to keep up as every project wants to finish very quickly and have the best quality possible.
Changes in technology adapt to the needs of the construction market. The needs are better
quality, quicker finish, easier work and inexpensive systems. New technology grows feeding
on these needs and therefore changes to fit these needs. With the vast increase of information
technology and computers the change faster than ever. This market affects all the markets
construction, materials, equipment, labor and infrastructure. The materials and equipment
change in accordance with the change of technology. The making of improvements to
equipment with the change in technology results in better equipment. Labor also gets affected
too when the technology changes. The skills needed of labors changes as the equipment
changes thus needing training for employees or employees with the knowledge already.

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Activities

An activity is what a company normal does. The main activities in the construction company
are as follows: Designing, valuing of costs, building and maintaining the project from
preconstruction to post construction.
 Designing: this is activity that happens just after the client has given the idea to the
company. It involves in designing in detail the plans of the construction project. If it is
a road the design is the plan of the road. If it is a high-rise building the design is the
plan of the high-rise building. The design includes the materials the measurements,
the levels, the equipment, the positions and exact detail of the procedure to build. The
designing is done by and architect or an engineer. An architect is usually involved in
high rise buildings, hotels, restaurants and houses. Whereas an engineer usually
designs roads, dams, plants, highways and larger projects.

 Valuing costs: this is the process where all material equipment and labor costs are
calculated and a BOQ is made with the minimum quota for the construction project.
All the materials equipment and labor are given a cost and all costs are stated in the
BOQ along with the quantity and the description of materials. The BOQ is made by
the Quantity Surveyor. Valuing costs happens before and during construction. Before
construction it is for the client to know how much is need to start the construction but
after construction it is to keep the client up to date in how the money is used and to
inform if more is needed.

 Construction: this is the process where the construction of the project begins. This
stage is the longest stage and has the most number of people involved in it. This stage
has engineers, contractors, managers and technical officers. All methods of
construction are analyzed and known to all workers in the stage. The construction
stage uses the plans from the design stage to construct the project. The construction of
the project follows the plan precisely.

 Maintaining: After the construction is complete, the next activity is maintaining.

Maintaining is the taking care of the construction project after its completion. The
changes the installations like; the electricity the water the sewerage etc. maintain
involves the fixing of broken parts, the renovations and the improvements to the
construction.

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 Services

Services are the activities that the company does to aid the customers.
The services provided are:
Preconstruction stage:
 Manage planning and design
 Evaluate potential sites
 Assist in selection of design team
 Maximize front-end planning with early feasibility studies to reduce problems during
execution
 Establish cost and time parameters and prepare bid packages
 Offer value engineering input and cost analysis
 Advise and consult on all aspects of planning
 Manage the design and construction phases
 Establish parameters for quality, cost and time
 Provide constructability reviews and cost analyses
 Prepare bid packages
 Prepare conceptual and detailed estimates
 Develop a phasing and sequencing plan
 Utilize Building Information Modeling (BIM) to ensure constructability of the design
while minimizing cost and schedule
 Prepare the overall project schedule and provide periodic detailed updates
 Establish and maintain all quality control standards
 Guarantee the construction cost
 Serve as General Contractor

Construction stage:
 Manage construction and coordinate all subcontractor activities
 Monitor costs and schedules
 Maintain quality control standards
 Problem solving
 Provide on-going communications and status reports
 Monitor subcontractor‟s safety programs
 Concrete

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  Earthwork
 Underground utilities
 Structural steel erection
 Process mechanical
 Equipment setting

Other services involve the following:

 Commercial and institutional buildings
 Highways, bridges and streets
 Industrial, manufacturing and utility projects
 Site development and infrastructure
 Military facilities
 Underground utilities
 Telecommunications
 Living facilities
 Hospitality

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(2.2)
Owner
Owner may be individual or group of individuals, the private or Public Sector Company.
Owner is ultimate authority over the project. All power of decision making regarding
managerial, the financial and administrative aspects is invested in him. Owner is responsible
for fund and other resources of project.
Public construction works are done through Government Engineering department. In this
reason owner and empowered engineer of the department are same person and he act on
behalf of President or Governor. Duties and liabilities are governed by contract document.
Duties and Liabilities of Owner
a) Owner appoints an engineer and delegates his power to work to him and in
consultation with him, he is appointing other necessary staff for the purpose.
b) Owner obtains necessary sanction for its construction from competent authority.
c) Owner allocates estimated cost to engineer.
d) Owner enters into contract with the contractor by signing contract.
e) Owner intimates Engineer the desired completion time.
f) Owner gives possession of work site to contractor.
g) Owner safeguards progress of work from outside interferences.
h) Owner makes payment to the contractor on production of certified bill from the
engineer.
i) Owner does not interfere the progress of work directly and he does not make any
changes without the knowledge of engineer.
j) Owner takes over possession of the completed project from Contractor.
k) In case of conflict with contractor, he appoints lawyer for defending his case.

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Design Team
 Architecture

 Cad Technician

 Structural Engineer

 Quantity Surveyor

Architect
The duty of architect is to assess the owner’s functional requirements and prepare plans and
specifications for the purpose.
These are the guys that create the overall theme of aesthetics and exterior of buildings and
other structural changes. Buildings also must be functional, safe and economically viable and
must meet the needs of the people who use them, or the client of the construction. Architects
consider all these factors when designing.
In the pre-construction level which is making drawings and according to this plan all the
duties are binned. In the planning phase you have to get the ideas of the Surveyor, for
minimizing the total cost of the total project.
During the period of construction and installation some changes may occur with the favor of
the client or the contractor. In this case, he must draw the plan including those with changes.
Not only does he have to check the site every day, if the construction going on with the right
way according to the drawings.

Cad Technician
A computer-aided design or CAD technician uses CAD systems to create design plans for
buildings and machinery. Essentially, CAD technician job involves the production of
electronic versions of the technical drawings which a draughtsman would previously have
created with pen and paper at a drawing board.
CAD technicians are employed in a broad range of industries including construction,
manufacturing and engineering. You could be working in local government, for the Civil
Service, electricity and water supply or the shipbuilding, telecommunications and
broadcasting industries.

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Structural Engineer
Structural Engineer is to prepare structural design as for requisite loads through technical
design and to prepare working drawings which is handed over to the construction engineer.
First draw a plane architecture ruff then the structural engineer that involves with him to get
the true strength of the structure, using materials needed in the required formats.
Normally if we are interested in the bearing capacity of the structure, shortly before making
plants and the changes we need to ask to get accepted by the Structural Engineer changes.
Responsibilities of the structural Engineer
 Analyses and design calculations

 Concrete and steel structure design

 Preparation of construction drawings

 Specifications and cost estimates

 They will also include reviewing shop drawings

Quantity Surveyor (QS)

The surveyor manages all costs relating to building projects, from the initial calculations to
the final figures. Surveyors seek to minimize the costs of a project and the update value for
the money. The quantity surveyor may work for the client or the contractor. They are
involved in projects from the outset. Preparation of estimates and labor costs when the project
is in progress. Not only is responsible for processing claims monthly end of the month.
According to the company claims can get money for their work completed today.
During the design of the QS with the architects to intervene in order to minimize the cost for
the entire project. Not only must prepare the full estimate for the proposed construction using
the plan.
During the installation phase variations can sometimes be understood or, sometimes, a little
'delivery of construction work to sub-contractors in this case, the changes in estimates can be
understood as a result of which he must be responsible for re preparing the estimates and
includes the monthly claims.
List of the responsibilities of Quantity Surveyor:
a. Prepare and submit quotations. Diligently following cases present at hand
b. Making documents awarding of contracts and preparation of contracts related
c. Sourcing and purchasing of materials and related products needed for
production
d. Need to perform collaboration with engineer and sales department

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 e. The need to make the connection with the main contractors, sub-contractors
and other parties involved projects
f. Avoid frequent studies and reference other cases, projects to solve all the
problems occurring in the field of work.
g. Expected to do a daily progress report and have the initiative to report to boss
without being asked at end of the day.

Construction team
 Project Manager (PM)

 Civil Engineer

 Quantity Surveyor (QS)

 Contacts Manager

 Site Agent

 Contractors

 Supervises

 Labors

Project Manager (PM)

A project manager is the person who has overall responsibility for the success of the projects.
He is managing the project in accordance with a time schedule and cash. The quantity
surveyors and other staff members give their help to succeed his role.
Some responsibilities of project manager are shown below.
Manage the project taking into account addition across all areas.
 Occupy with stakeholders.
 Develop Project Plan.
 Direct project resources.
 Monitor and manage the project schedule.
 Monitor and manage the project budget.
 Monitor and manage the project risk.
 Deal with operational issues.
 Health and safety issues.

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The level of construction pre-race is developing. After obtaining the building by offering you
have to think at the level of design of the building. In this phase, the surveyor of the company
responsible for the production of BOQ if you calculate the total estimate of the total project.
Then the project manager to prepare the calendar based on the duration of the project.
Within the period of construction, if there is a delay or another case, he must act to run into
these situations and solve cases. If we care about the construction process must responsible
for the total project progresses from the pre to the final stage.

Civil Engineer
This is a professional engineering discipline that deals with the design. construction and
maintenance of the physical and naturally built environment, including works such as
bridges, roads, canals, dams, buildings one.
Normally he should be on the site at the end of completion.
Duties and responsibilities:
a. Civil engineer must start from analyzing various areas and factors that are
related to designing and the construction.
b. Investigate and examine the locations of site.
c. Civil engineer work according to plan with regards to what are key essentials.
d. Review and approve project report and designs.
e. Civil engineer should develop detailed design layout that covers the
requirement of client.

Quantity Surveyor (QS)

Surveyor is doing the management part of the costs of the construction industry. They must
be responsible for the BOQs, estimates, etc. It claims Monthly 'the politics of a Surveyor is to
provide a good amount of Surveying and estimation and contracts for services to clients in
both areas, including contractors and sub-contractors consistently meet and exceed the needs
and reasonable expectations of all our customers.
 Initial cost advice and feasibility studies
 Budget estimating
 Cost planning
 Procurement advice
 Contractual advice
 Advice on contractor selection

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  Preparation of tender and contract documentation
 Tender analysis / negotiations / selections
 Tender reports and recommendations
 Cash flow projections
 Cost control & reporting during the construction stage
 Valuing and agreeing contract variations
 Valuation of work in progress
 Payment recommendation
 Settlement of final account

If we think of a normal erection without Quantity Surveyors, waste material can be happen. If
we want to minimize these assumptions, we have to be passionate with the services of
surveyors. Not only that they are managing the technical officers, supervisors and all
employees of the site.

Contracts Manager
Managers are responsible for managing employees in the company and the account side. This
is the guys who are responsible for the company's profit.
Construction managers are increasingly plan, direct, coordinate and budget for each of the
construction projects, including the construction of commercial, industrial, sewage, hospitals,
hotels, etc.. Construction managers can oversee the entire project. They first plan and
coordinate all design and construction processes, including the selection, hiring, and
oversight of specialty trade contractors, such as carpentry, plumbing or electricity, but usually
do not do any actual construction of the structure.
 According to a construction company, the company was in need of a good number of
professional, managerial and technical roles are described below and divided into the
following areas: construction and design, planning, engineering, professional
contractors, site measurement and management of the site, management roles and,
finally, technical and educational. The construction industry employs people with a
variety of skill levels, including co-operatives, skilled craftsmen, technicians and
professionals such as civil engineers and quantity surveyors.

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  Finally, the concern all the professions in the company, the only thing is that it covers
their activities and services in the right way. Then the company will go up in the
profit and rank of the company.

Site Agent
Site argent or the site manager is main body of control site. Site argent is resident on site and
deal with actual management, supervision and the control of project.

Contractors
Contractor may be individual or large construction company. In some projects, contractor
may sublet part of work to sub-contractor or the petty contractors. This is done because
contractor may not have the required infrastructure for certain works. Contractor has to
execute various types of works and has to make all necessary arrangements for labours,
equipment, and the materials etc.. in order to complete the project within stipulated time and
cost.
Vital duties and liabilities of a contractor are covered by the conditions of contract:
Duties and liabilities of Contractor
a. Contractor undertakes execution of work or services concerned there with as
per terms and conditions of contract agreement.
b. Contractor has to visit worksite, and study soil conditions before tendering.
Contractor should ascertain accessibility, availability of the water supply and
electric power and other facilities for construction purposes and should see
local conditions also.
c. Contractor has to collect local rates of material and labour to determine the
item rate.
d. Contractor should be required to designate representative who is authorized to
act on his behalf.
e. Contractor is required to obtain all building permits in connection with work.
f. It is the duty and liability of contractor to follow the labour act.
g. It is the duty of contractor to safeguard his own men and material.
h. It is responsibility of contractor to safeguard completed portion of work until it
is finally handed over to owner.
i. Contractor should thoroughly study clauses of conditions of contract and
follow the contract agreement truly.
j. Contractor should finally handover the completed work to owner and get the
final payment, adjusting running bill account.

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Supervises
Their responsibility is to obtain the data required by specialists and are doing practice with
less staff. In the design phase does not have a responsibility with the drawings, but during the
construction period and install ting are the people responsible for guiding the staff unless the
right way.
Labours
They only have responsibility in day today works in practical. They are doing the practical
construction works with the help of supervisors.

Installation team
 Mechanical Engineers
 Electrical Engineers
 Plumbing Engineer
 Trunk Drivers
 Crane Operators
 HVAC installers
 Heavy equipment operators

Mechanical Engineer
Mechanical Engineer is the responsible for the mechanical services associated with the
project during and after construction.
Electrical Engineer
Electrical Engineer is with the preparation of working drawings for electrical power and
distribution system during and after construction.
Plumbing Engineer
Plumbing Engineer is with the preparation of working drawings for Plumbing and
distribution system during the construction.

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Main Cycle of work activities
The cycle of work activity is the process of work that is being done by the construction
company. In the cycle there are different stages with different people involving in these
stages. The following are the stages:
 Preconstruction
 Construction
 Post construction

During these stages there are professionals who control these stages and how they work. The
main plans to the details are done by these professionals. These professional are:
 Architects
 Engineers
 Quantity Surveyors
 Technical officers
 Contactors
 Laborers
 Technicians
 Managers
 Project manager
 Painters

Figure 2: Main cycle of work activities

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The main cycle, its professionals and their duties are as follows:
Preconstruction stage
This is the stage where the designs for the construction and the cost for the construction are
prepared.
The professionals involved:
Architect or Engineer: The role of the architect or the Engineer at this stage is the drawing
of the plan according to the needs of the client.
Quantity Surveyor: Quantity Surveyor refers the plans drawn and makes a rough cost
estimate for the commencing of construction. It is important for the quantity surveyor to
make the best cost estimate so that the client and the engineers benefit from it.
Construction stage
This stage involves in the construction of the physical building. Different construction
methods are established and made use of during this stage. During this stage the construction
closely follows the drawings and instructions of the plan.
The professionals involved in this stage are:
Engineer: the engineer uses methods and techniques to build the physical building. The
engineer can implement new technique or use old ones. The engineer is the professional that
decides finally which technique is use and what equipment is used for the technique
suggested in building the physical building.
Quantity Surveyor: calculates the costs that are used during the project. Also the labor costs
and any damage or wastage is also calculated by the quantity surveyor.
This is to show the client how the money was spent and how much is needed.
Contractors: are need e to help build. They along with the engineer help decide the
techniques, methods, equipment that should be needed. The contractor also provides the
labors needed for the project.
Laborer: they are the people who physically build the construction. They use the techniques
proposed and follow the engineer’s advice and make the construction.
Manager: are present to make sure the workers get what they need and to manage the
professionals involved in the construction.
Technical officers: involved in making the basic technical parts of the construction for
example for a high rise building the electricity.

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Project manager: Project manager has the overall power of controlling the project tasks by
successfully planning, designing, monitoring, controlling, initiating of a project. Project
manager has the responsibility of accomplishing the mentioned project objectives and goals.
He has the responsibility of managing the whole project.
Painters: they are responsible for painting if the construction is a building of any sort.

Post construction stage

This is the stage where the installation of electricity, water and waste is done. In this stage
maintenance is done as the project is over. Once the project it is very important to make sure
that the construction stays in the same manner or gets improved with time.
The professional involved in this stage are:
Engineers: they make sure that the construction doesn’t fall apart. The engineer periodically
checks the construction for problems. Any problems that are caused a solution is sought out
and implemented.
Technical officer: installs all the electricity and makes sure that it is in perfect working
condition. Any problems that are found will be noted and solutions implemented.
Quantity Surveyor: calculated the costs of maintenance and renovation.

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(2.3)
Organization Structures

The typically hierarchical arrangement of lines of authority, the communications, rights and
the duties of an organization. The Organizational structure determines how the roles, power
and the responsibilities are assigned, coordinated, and controlled, and how information flows
between the different levels of management.
A structure depends on the organization's objectives and strategy. In centralized structure, top
layer of management has most of the decision making power and has tight control over
departments and divisions. In decentralized structure, decision making power is distributed
and the departments and divisions may have different degrees of independence.
In construction industry, organization itself can be considered as an important resource which
has to be put to optimum use. It is necessary to continuously examine in context of
company’s size and complexity of business, the grouping of activities, the levels in hierarchy,
and the span of control, use of staff of for coordination and controlling, the role of group in
relation to each other, and gamut of other considerations which can make organization more
effective. Such important consideration is need to avoid line and staff conflict and to adjust
organizational structure to avoid a communication gap between line managers and staff so
that the decisions are based on analysis and knowledge rather than intuition and the personal
preference. Though, every organization has its own personality and working climate, so,
unless large scale organization gives special and continued attention to organizational
planning and develop it on the appropriate footing, it is the bound to affect performance and
capacity for its future growth and hence will not conducive to optimum utilization of the
available resources.

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Figure 3: A typical organizational chart for large size construction company as applicable to a
public sector organization.

Figure 4 : Organizational Chart for a Construction Unit Under resident / Executive Engineer

A typical organizational structure for a medium to large size contracting company in the
public sector is given in the above two figures. An organizational structure is nothing more
than graphic representation of the channels of communication. It’s very important that
channels of communication be known and they are followed. in sometimes, because of
expansion or contraction of activities and sometimes changes in personnel, changes may be
take place organization. Therefore, chart must be subjected to periodic review and change.
Construction of structure or chart requires a thorough knowledge of the natural components
of company’s or the construction firms. Then the major and minor sub divisions of whole

49
organization is determined to achieve the smoothest and the most economical coordination
and operation.
Every organization will have variations in grouping due to processes of growth, to the
personalities and to local conditions, management requirements and environment

Example: MAGA Engineering Organization Structure

Figure 5

Direct Line organization structures

The line organization is the simplest organization structure. It is characterized by direct
vertical links between the different levels of the organization. The instructions are given
down the chain of command. In this structure all organizational units are directly involved in
the production and marketing of organizational goods. The approvals and orders in this kind
of structure come from top to bottom in a line. Hence it is known as a line structure.
Advantages:
 It is simplest kind of organizational structure.
 Strict authority results in stronger discipline.
 Prompt decisions result in the quick and effective actions.
 There is clarity in structures of authority and responsibility.
 As control rests with one superior; it accords him the flexibility to adjust the
department.
 There are the good career advancement prospects for individuals who deliver quality
work.

50
Disadvantages:
 There are chances of department head being biased.
 Lack of specialization is persistent problem.
 Department head may be burdened with lots of work.
 Communication only happens from the top to bottom.
 Superiors with authority can be misuse it for their benefit.
 Decisions are taken by single person and can go wrong.

Lateral organization structures

Lateral organizational arrangements include individuals of different departments and the
groups. These relations exist on same organizational level and involve coordination and the
consultation. This type of arrangements depends upon the co-operation activities and of the
informal relations. It is therefore important to questions about whom, how and why people
are doing what they are doing and what they should do in the strategic implementation. In
short effective lateral organizational arrangements add value, manage business and can
contribute to strategic success but, conversely, they can be make spectacular errors that can
be very costly to the organization .
Lateral structure is that employees communicate on the same level, laterally, rather than up
and down. The relationship between different departments and employees is on the same
hierarchical level. These structures still have upper management, but they are urged to foster
good working relationships between employees.
Lateral structural arrangements are typically incorporated into existing structures rather than
replacing the typical vertical reporting structure.
According to lateral organizational arrangements it is made easier when top management,
who retains the ultimate responsibility for the personnel function, take active part in fostering
goodwill and harmonious working relationships among the departments. Top management
should agree clear terms of reference for individuals within a framework of the sound
personnel policies. Within this framework the personnel function can be seen as operating at
two levels: the organizational level and the departmental level.

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Functional organization structures
The staffs in this structure are divided into the different functions they do. Employees in this
structure are specialized to do specific tasks. The specialization leads to operational
efficiency where the employees become specialists in their subject.
An example of functional

Figure 6

Advantages:
 It has high degrees of the specialization.
 It has clear lines of the authority.
 It facilitates easy accountability for work.
 It accords high level of speed and efficiency.
 The need for duplication of the work is eliminated.
 All functions command equal importance.

Disadvantages:
 Communication has several barriers which makes the coordination difficult.
 More focus is laid on a individuals rather than the organization.
 The decisions taken by single person may not always work in favor of the
organization.
 As organization expands, it gets difficult to exercise control on its operations.
 There may be lack of the teamwork between different departments or units.
 As all functions are separated, employees may not gain knowledge about other
specializations

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Centralized organization structures
In a centralized organization, important information is mainly reserved for top management.
The top tier has all the power. In such a system, a limited number of people have all the
power in the organization and enjoy a wide spectrum of control.
Advantages:
 Policies and the objectives are given clearly to employees thus giving a clear idea of
what the organization expects.
 Top management compromises of experts who are likely to make best decisions due
to limited number of people making them
 Bypasses potential of conflicts

Disadvantages:
 Older system
 Time is taken to the solve problems and sometimes problems do not reach the higher
authority therefore a solution may not be reached
 A great deal of the responsibility in relatively few people
 Less effective way of reaching solution to big problems

Decentralized organization structures

In a decentralized organization, decision-making power is held not just by upper-level
management; it is shared with lower-level staff. In such a system, the top managers get a
continuous input of facts, information and ideas from the reporting line.
Advantages:
 Setting objectives is done by the employees therefore the conclusions are owned by
them
 Moral and motivation is the higher than centralized
 Better choices made due to the firsthand knowledge available

Disadvantages:
 It is very risky if dependent staff have not required skills for expert decision making
 The staff and the employees must be trust worthy otherwise this system falls apart

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 Span of Control
Span of control refers to the number of people that a manager can supervise.
Span literal meaning says, is the distance between the tip of a thumb and the little finger when the
palm is fully stretched. However, in terms of management and administration, the maximum
extend or the number of people that can be reached by.
Control in the literature means an ability to instruct, monitor, adjust or use something like for
once the preferred option requirement or expectation. However, in terms of management and
administration, refers to a power of authority to direct, order or restrain.

An example of hierarchy is shown in the diagram below

Figure 7: span of control

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 Chain of command
The chain of command, sometimes called chain climber, is the formal line of authority,
communication and accountability within an organization. The chain of command is usually
depicted in an organizational chart that identifies the relationship between superior and
subordinate in the organizational structure. According to the theory of classical organization
chart can display the lines of authority and communication within an organizational structure
and ensures a clear allocation of roles and responsibilities. Using the chain of command, and
its visible authority relations, the principle of unity of command is maintained. Unity of
command means that each subordinate reports to one and only one superior.
The advantages of the hierarchies are:
 Helps create clear communication line between the top and bottom of the business;
this improves the coordination and motivation since employees know what is
expected of them and when.

 Hierarchies create departments and departments form a teams. There are motivational
advantages of working in teams.

The disadvantages of the hierarchies are:

 The formation of a departments can mean that.

 Departments work for themselves and not greater good of the business.

 Departments do not see the whole picture in making the decisions.

 Hierarchies can be inflexible and difficult to the adjust, especially when businesses
need to adapt to changing markets: remember employees don’t tend to react well to
change.

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Figure 8: Model of a company value chain

Figure 9 : Value chain of Maga Engineering

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 Job design
The average labor management is working arrangement or reorganization aimed at reducing
or overcoming job dissatisfaction and employee alienation arising from repetitive and
mechanistic. Through job design, organizations try to increase levels of productivity,
providing non-monetary rewards, such as greater satisfaction from a sense of personal
accomplishment in meeting the challenge and greater responsibility for their own work.
Therefore, it is evident that a proper job design helps to overcome many problems in the
organization. Job design must take into consideration followed. (Which activities are done,
when and how the activities are done, how many activities are done, the factors affecting the
work, the content organization and activities)
Through job design, organizations try to raise productivity levels by offering non-monetary
rewards such as greater satisfaction from a sense of personal achievement in meeting the
increased challenge and responsibility of one's work.
Job enlargement, job enrichment, job rotation, and job simplification are the various
techniques used in a job design exercise.
Job enlargement: increasing the number of tasks associated with one job with appropriate
training provided. This gives a different variety to the activities making the job less
monotonous.
Advantages:
 Job satisfaction

 Job is made in interesting

 Output from employees is higher

 Productivity of employees is higher

Disadvantages:
 The job could be too large for one person

 Work load is too hard to accomplish

Job enrichment:
This is a variation to job enrichment. By increasing the level of responsibility of an employee
it adds as a new source of job satisfaction.
Job enlargement is a horizontal restructuring method
Job enrichment is a vertical restructuring method which gives employees more authority,
autonomy and control of accomplishing a job.

57
Job rotation: a technique involving moving employees between two or more jobs in a
planned manner. Exposing the employees to different types of jobs is the objective of this
method.

58
(2.4)
Project Based organization structure

A project is an organizational effort with a specific objective that needs resources, and must
meet time, cost and quality requirements. A variety of businesses in construction,
entertainment, aerospace and other fields use projects to organize their work. In a functional
structure, work is organized in departments based on specialties such as marketing and
finance. However, in a project-based organization, most of the business functions are
organized in projects. Small-business managers may consider adopting a project-based
structure to improve effectiveness.

Figure 10: project based organization structure

A project is an organizational effort with a specific objective that needs resources, and must
meet time, cost and quality requirements. A variety of businesses in construction,
entertainment, aerospace and other fields use projects to organize their work. In a functional
structure, work is organized in departments based on specialties such as marketing and
finance. However, in a project-based organization, most of the business functions are
organized in projects. Small-business managers may consider adopting a project-based
structure to improve effectiveness.
Structure
In a project-based organizational structure, there is a general manager or CEO; also, there
may be functional departments such as operations and finance, but projects are the main units
of conducting activities. Project teams conduct almost all operations of the company.
Functional managers make sure that projects have access to employees with the right
functional expertise. Project managers have a lot of autonomy and are responsible for
delivering results. They select team members, allocate tasks and oversee performance.

59
Advantages:
In a project-based organizational structure, employees are assigned to projects and report to
the project manager. The project manager conducts performance appraisals and prepares
career development plans for project team members. This improves employee loyalty to
project goals. Moreover, because the project manager has direct control and authority over
project operations, flexibility and response time to changing circumstances improve.
Disadvantages:
Without devising procedures to share knowledge between projects, learning in the company
suffers. Projects need their own resources and expertise; as a result, duplication of resources is
another problem with project-based organization. Additionally, when personnel keep moving
from one project to another, professional growth and career continuity of employees suffer.
Managers should strive to clarify the contribution of the project to the overall mission of the
company to avoid ambiguity for employees.

Figure 11 : MAGA Engineering Commercial Building Project Based organization Chart

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Simple Structure
A simple organizational structure has a hierarchy that consists of a top executive who
delegates authority down the organizational ladder. It is appropriate for smaller companies in
which a founder directs operations and for regulated businesses in which tight compliance
with policies and procedures is essential. The structure is efficient because all activity is
coordinated through the direct lines of authority. This organizational structure is slow to react
to external changes, because information has to travel up the organization's chain of
command and instructions have to travel back down.
Divisional Structure
When a company grows, it becomes too large to operate under a simple organizational
structure and often splits into divisions. Each division acts as a smaller company with a
simple structure, but the divisions are tied together at the top under a corporate framework.
Divisions can be responsible for operations on a geographical base or on the basis of product
lines. The structure is as efficient as a simple company, but coordination can be a problem,
because each division acts independently and efforts can be duplicated.
Functional Structure
The functional organization structure solves the duplication of effort in divisions by splitting
the company into departments based on functionality. For example, one department is
responsible for companywide marketing and another one is responsible for all human
resources. The structure is hierarchical, but the chief executive delegates authority to the
professionals in each specialized department. While duplication is reduced, coordination
suffers as each department focuses on its area of activity.
Matrix Structure
In rapidly changing markets, companies must adapt quickly and need a flexible
organizational structure, because the hierarchical models are too slow to react to external
changes. The matrix structure combines the hierarchy for organizational matters with a
responsiveness gained through placing responsibility for executing work at lower
organizational levels. Teams operating at the working level have responsibility for carrying
out work and interacting with the market. The team members report to a team manager for
their work and also report to managers in the company hierarchy for disciplinary and job-
related matters. The structure can be inefficient: Work can be duplicated, coordination
between teams can be lacking and there might not be a clear path of authority. Its advantage
is the ability to quickly respond to customer concerns and market changes.

61
The disadvantages of a matrix organization arise from the dual reporting structure. The
organization's top management must take particular care to establish proper procedures for
the development of projects and to keep communication channels clear so that potential
conflicts do not arise and hinder organizational functioning. In theory at least, top
management is responsible for arbitrating such conflicts, but in practice power struggles
between the functional and product manager can prevent successful implementation of matrix
structural arrangements. Besides the product/function matrix, other bases can be related in a
matrix. Large multinational corporations that use a matrix structure most commonly combine
product groups with geographic units. Product managers have global responsibility for the
development, manufacturing, and distribution of their own product or service line, while
managers of geographic regions have responsibility for the success of the business in their
regions.

Figure 12

Team-based Structure
The team structure in large organizations is seen as a newer type of organizational structure.
The basic unit of the team structure is the team, a group of people ideally with
complementary skills and synergistic efforts working toward a common goal.
There may be several teams in a large organization following the team structure, and the
teams can change over time. The Teams can include members from different functions,
which are the called cross functional teams.
Team-based organizations filter decision making down to all levels of the management, while
traditionally structured organizations rely on top management to make decisions. The Team-
based organizations require that all employees participate in the decision-making process.

62
Employees feel that they are part of the total organization, rather than the members of an
individual department. Consequently, the team-based organizations run more efficiently and
effectively, giving them a competitive edge in today's global markets.
Boundary-less Organization
An association where management has largely succeeded in breaking down barriers between
the internal levels, job functions and the departments, as well as reducing external barriers
between the association and those with whom it does business. Developing business into a
boundary-less organization might include creating a more horizontal management structure,
encouraging interdepartmental projects, and the empowering staff members.

comparison of such organization structures

Organizational structure types are the means by which companies group workers, processes
and work flows to manage productivity. The three types of organizational structures are
functional, divisional and matrix. Comparing these organizational structure types becomes a
function of how best to organize employees to interact with each other, and the tasks they
perform to generate products and services for the end consumers in the most efficient and
effective manner possible.

63
 REFERENCE

 Wijesooriya (2017). Shameera - Work Report - Maga Engineering. [online]

Slideshare.net. Available at:
https://www.slideshare.net/ShameeraWijesooriya/shameera-work-report-maga-
engineering?from_action=save [Accessed 28 Nov. 2017].

64
 ADVANCED CONSTRUCTION TRANING ACADEMY

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Program: Edexcel HND in Quantity Surveying

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