Construction Management & Economics

Raisbeck, Peter

doi: 10.1080/01446190802512342pmid: N/A

Southern Cross Station is one of the largest public–private partnership (PPP) projects undertaken in Australia. In this project the architects played a significant role in developing an iconic design which has received international professional design awards and much media attention. In the media the architects' design was perceived as having impacted negatively on capital costs. Given these contradictory perceptions, the aim of this study was to better understand perceptions of the architects' role in relation to project risks arising out of their design. A survey of key project executives working in the PPP consortium responsible for delivering the project was undertaken. The survey was structured by a framework combining the PPP life cycle, project risks and the idea that architectural design can be viewed as a research and development activity rather than simply as a problem‐solving activity. The survey responses point to the fact that the architects mitigated technical and operating risks and their activities had little bearing on the project's substantial write‐downs. This counters media perceptions of the project that the design activities of the architects created more risks than they mitigated.

Kheni, Nongiba A.; Dainty, Andy R. J.; Gibb, Alistair

doi: 10.1080/01446190802459916pmid: N/A

The construction industry plays a significant role in the economy of developing countries. The sector is, however, also one of the most hazardous with frequent accidents and health‐related problems. The health and safety practices of construction small and medium‐sized enterprises (SMEs) in Ghana are examined with a view to improving the health and safety performance of the sector. A survey questionnaire was administered to owner/managers of SMEs, with a response rate of 32% of the sampling frame. Few of the SMEs adopted proactive health and safety practices. However, health and safety practices identified as being particularly associated with firm characteristics were: accident investigation procedures; accident reporting procedures; use of health and safety posters; documentation of method statements; and health and safety inductions. The diversity of health and safety practices associated with different size categories of SMEs and constraints to improving health and safety are highlighted. A positive change is needed in the attitudes of owner/managers which takes into account size‐related constraints in order to improve the health and safety performance of Ghanaian SMEs.

Brandao, Luiz Eduardo T.; Saraiva, Eduardo

doi: 10.1080/01446190802428051pmid: N/A

The participation of private capital in public infrastructure investment projects has been sought by many governments who perceive this as a way to overcome budgetary constraints and foster economic growth. For some types of projects, this investment may require government participation in the form of project guarantees in order to reduce the risk to the private investor, and as a consequence, the government assumes a contingent liability which may have significant future budgetary impacts. We present a minimum traffic guarantee (MTG) real options model that differs from most of the literature in the field by using market data to determine stochastic project parameters. This model can be used to assess the value of these guarantees, allows the government to analyse the cost–benefit of each level of support, and proposes an alternative to limit the exposure of the government while still maintaining the benefits to the private investor. We apply this model to the projected 1000 mile long BR‐163 toll road that will link the Brazilian Midwest to the Amazon River. We conclude that the use of public–private partnerships (PPP) with guarantees and caps on total government outlays can be modelled effectively using option pricing methods and can be a solution to attract private investment to high risk public infrastructure projects.

Doloi, Hemanta

doi: 10.1080/01446190802512359pmid: N/A

The novated design and construct (ND&C) contract is one of the increasingly preferred options among developers of large commercial and residential projects across Australia. As a consequence of novation, the design team's obligation to the client gets transferred to the contractor who becomes responsible for carrying out the detailed design work at a later stage of project life cycle. Subsequently, there are some inherent factors that can depict the effectiveness of how all parties in the process interact leading to a successful delivery of project through ND&C contracts. A common set of 31 influencing attributes have been identified through a systematic research approach and their relative significance and impacts have been determined based on a structured questionnaire survey in selected construction projects. By performing the factor analysis, a total of eight factors significant to ND&C contracts were extracted, namely (1) impact of initial design; (2) client's involvements in post novation design; (3) selection of design team; (4) contractor's obligation; (5) morale in post novation; (6) experience of design team; (7) relationship between contractor and design team; and (8) expertise of DT in ND&C projects. With a clear understanding of the roles of clients, design team and the contractors, these findings could potentially contribute to develop a company's procedures or enhance existing knowledge in relation to the ND&C procurement approach.

Nasirzadeh, Farnad; Afshar, Abbas; Khanzadi, Mostafa; Howick, Susan

doi: 10.1080/01446190802459924pmid: N/A

The complex structure of construction project risks arises from their internal and external interactions with their dynamic nature throughout the life cycle of the project. A system dynamics (SD) approach to construction project risk management is presented, including risk analysis and response process. Owing to the imprecise and uncertain nature of risks, fuzzy logic is integrated into system dynamics modelling structure. Risk magnitudes are defined by a fuzzy logic based risk magnitude prediction system. Zadeh's extension principle and interval arithmetic is employed in the SD simulation model to present the system outcomes considering uncertainties in the magnitude of risks resulting from the risk magnitude prediction system. The performance of the proposed method is assessed by employing the method in the risk management plan of a sample project. The impact of a sample risk is quantified and efficiency of different alternative response scenarios is assessed. The proposed approach supports different stages of the risk management process considering both the systemic and uncertain nature of risks.

Ding, Zhikun; Ng, Fungfai

doi: 10.1080/01446190802527522pmid: N/A

Measurement is a fundamental issue in management research. However, traditional scale development methods have the drawback of mixing researchers' bias with the scale design. Based on Ding et al.'s (2007) exploratory work, a new way to develop semantic differential measurement scales is proposed and tested with a survey in the context of the construction industry. The purpose is to provide researchers and practitioners with a new method to develop semantic differential scales for measurement while the bias from their own perspective can be reduced. The reliability and validity of semantic differential scales according to the new method are tested with SPSS and Amos 6.0. The results show that the generated semantic differential scales with this method have high reliability and validity. The new way to develop semantic differential scales offers researchers and practitioners one more choice of scale development. The general application of this new method to other contexts is yet to be tested.

Kofoworola, Oyeshola Femi; Gheewala, Shabbir

doi: 10.1080/01446190802425560pmid: N/A

Three input–output (IO) tables compiled between 1995 and 2000 were used to examine the significance of the construction sector and its relationships with other sectors of the Thai economy. The pull and push effect of the Thai construction sector to the national economy indicated that the former is much larger than the latter. Additionally, the relatively high output multipliers and backward linkage indicators showed that the construction sector had the potential to trigger off production in many economic sectors linked to it. An aggregated sectoral analysis revealed the high dependence of construction on manufacturing followed by services. The findings also suggest that the trends of the profile of inputs and outputs are correlated to the economic conditions in Thailand at the time the IO tables were compiled. Finally, the results of employment analysis showed that although the share of construction sector in direct employment generation may not be very large, its economic importance lies in its direct and indirect contribution to employment through strong backward linkage effects. Consequently, when its backward linkages and output multiplier are considered together with the employment opportunities latent within it, then the construction sector could be a major contributor to the economic growth of Thailand.

Forbes, Doug; Smith, Simon; Horner, Malcolm

doi: 10.1080/01446190802468487pmid: N/A

The built environment is full of uncertainty which leads to risk. The literature shows that there is a wide range of techniques available to deal with risk; however numerous studies have shown that only a relatively small number are used in practice. One reason for this small number is a lack of knowledge of the circumstances in which they can be used. With the aim of overcoming this lack of knowledge two decision support tools are developed, which assist in selecting appropriate cases. The first tool is a two‐dimensional matrix which provides a graphical output but has several limitations; the second is a case‐based reasoning (CBR) model. These tools have been built from literature examples of the application of risk techniques. A framework has been developed to assess the examples. It uses a PESTLE (Political, Economic, Social, Technical, Legal and Environmental) analysis to assess the problem characteristics. The associated data used in the problem were defined as fuzzy, incomplete or random. The results of the CBR validation demonstrated a tool that predicts the correct technique in excess of 80% of cases, and allows the matrix to be revised and refined.