Strategic Management of Construction Projects - Case Study Example

A report on STRATEGIC MANAGEMENT OF MAJOR CONSTRUCTION PROJECTS By [ name of the author] A report on STRATEGIC MANAGEMENT OF MAJOR CONSTRUCTION PROJECTS from [name of the organization] [author’s name] [date of fulfillment] Acknowledgment Abstract This is a paper in which I am working on the complementary capabilities along the building delivery process. My target is to highlight all those aspects of the historical evolutionary phases that support act in the construction of organisational structure. The specification is also regarding the study of international construction alliance between two organisations. The purpose is to indicate potentially successful areas of operation in the building delivery process within a construction market place. My specifications are based on Building International Construction Alliances by Roberto Pietroforte. Table of Contents Cover sheet 1 Title page 2 Acknowledgment 3 Abstract 4 Executive Summary 6 The report 7 Conclusion 18 references 20 Recommendations 21 Executive Summary The focus of this paper is to check out the book Building International Construction Alliances by Roberto Pietroforte. I am trying to find the international cooperation between medium-sized construction firms and the strategically structured implementation for the process of alliances among construction firms. I am working on the historical evolution of Fratelli Dioguardi and Beacon Construction. It is report that authenticates my study over the aforesaid context. The matter of analysis is over the shrinking construction market that has got highly developed economies for the purpose of the alliance. The analysis will be over all possible aspects of analytical periphery. The report INTRODUCTION The concept and application of joint ventures and construction of alliances, especially in UK and Italy needs some kind of specific speculation. In the Building International Construction Alliances by Roberto Pietroforte there are all the aspects related to this context. As for this paper I am trying to pick up the major strategical aspects of the services that are related to the building, operation and transfer services of the middle sized firms. With reference to Fratelli Dioguardi and Beacon Construction Company; I am trying to comprehend the sequential ways of building international construction alliances. Through the case study of the historical evolution of Fratelli Dioguardi S.p.A. and Beacon Construction Company, and all their outstanding representative projects, Roberto Pietroforte makes all the points related to the way of adjusting a successful firm’s strategic, organizational and operational settings. According to this study the success of all these strategic, organizational and operational settings depends on the changes in their market environments. These means are the ways of giving more stability under the adverse circumstances where the structure of the market remains unpredictable. Along with many of the features it is very important to have the design or the build and package deal services in reference to the context. The facilities are allotted for pre-construction services. My field of analysis laid emphasis on the construction management services and the project management services of the specific firms on concern. It is an elaborate case study that is aimed to give the universal appeal to the historical evolution of Fatally Dioguardi and Beacon Construction Company. There is this property development and management services that is also a matter of concern in this paper. Building International Construction Alliances has been to be the first book dealing with the category of international cooperation between medium-sized construction firms. It is for sure that as the market is something out of anybody’s assumption; there can be all kinds of flexibility. However the aim to be in an allied term makes these assessments and risk factors easier while handling. There is a continuous support and this dependence makes the business stronger. Added to all kinds of managerial, administrative and corporational assistance there is also the biggest financial support and that makes the firm more prominent in the international scenario. As stated by Kuglin, F.A.; J. Hook (2002), there are all kinds of high voltage risks in the international market and that can cause heavy instability in the operation of a firm1. But being in the allied construction lowers the risk factors and brings in the stability and sustainability on long term basis. In Building International Construction Alliances by Roberto Pietroforte; the aim is to check all the possible aspects of this sustainability and slang term stability. As for the case study the topic of concern is the construction of alliance between Fatally Dioguardi and Beacon Construction Company. We can see how the author has analysed every single aspect of this case and clears many doubts. Strategic alliances from historical evolution Strategic alliances among construction firms make way for many kinds of services. This is well realised as we check the alliance of Fatally Dioguardi and Beacon Construction Company. Fatally Dioguardi S.p.A. (Dioguardi), being a medium sized firm was restricted to a great extent. However things changes as the alliance with Beacon Construction Company happened. This book, Building International Construction Alliances by Roberto Pietroforte; is making an elaborative effort in analyzing the historical evolution of both Fratelli Dioguardi S.p.A. and Beacon Construction Company. These two companies stand as ideal for all those firms who are facing all kinds of challenges in their respective environment. It also targets to all those companies that are in a very marginal position in the International marketing competitiveness. These two firms allied together and have made lots of adjustments to the opportunities and the challenges that came in their way to the success of getting established for an international image. They are the best examples in representing themselves as the firms with progressive acquisition with their strong and bonded capabilities. With the alliance there were many logical aspects emerged in the functionality criteria of both the companies. There is a clear demarcation between the objectives and the needs of the perspective projects. The analytical aspect as initiated by David C. Mowery, Joanne E. Oxley, Brian S. Silverman (1996), too was well established. It was all because of the existence of the support led by the compatibility and the complementary nature as adopted by both the firms2. The initiation was well lead by a definite and very common objective. There is a compulsion of having uniqueness in the understanding and implementation of a particular agreement. This is the way hat makes the foundational structures of the firm stronger and dominant in the contemporary international market. Challenges in International alliances Under the pressure of international client demands, it is very important to have a free flow of cash management. There have to be all kinds of financial and supply availability. The partnering is the vital comprehensiveness for such success in international scene (Child, John; David Faulkner, 1998)3. Though international alliances are in great demand today yet is not at all free from all kinds of limitations. It is true that with these kinds of support a firm can well establish itself. However at the same time it faces many complexities. As stated in Building International Construction Alliances by Roberto Pietroforte; the most common hassle lies in the characterization of the market. As for instance the European market has got a fragmented and localized construction as against the geographical diversification of US market (p.97). The choices vary in a great divisional perspective. It thus becomes very important to have a proper speculation of the same. This demands the typical and very professional skills of analyzing the markets on every level and in every national arena. There is the interference of business attitude and it is very important to check it out. There can be a very devastating difference in the long term and he short term expectation of the firm. This is again unpredictable, yet needs enough expertise to make analytical survey of the same. Yoshino and Rangan, Michael Y. and U. Srinivasa (1995), demonstrated that the international alliance also needs to have proper dependence over the formal and all kinds of informal documentation4. This is the means to establish the business relationship in every territory of the world. There is this delegation of authority that demand all types of cross culture management (98-99). Need of International alliances In spite of all these hassles the recommendation made by Building International Construction Alliances by Roberto Pietroforte; is always for the construction of international alliances, especially between the middle sized firms. It is definitely the means to grant success through perfect partnering of the construction firms. By means of such alliances, it is very much sure that there comes in a kind o firm trust and dependence. Doz Y. L., Hamel G states that it creates enough space for a fair relationship5. As the purpose of such alliances is to have continuous efforts towards the international establishment, it clears many doubts between the partners. The international alliances between the firms are highly recommended as it is the way for to the development of cooperative feelings among the alliance partner. This is the best way to identify all kinds of possible risks. Moreover due to an expandable financial status there is every scope to make the risk much affordable and more solvent. In the competitive international market; alliances stand as a great support to each other and that helps in a very steady and long term growth of the firms. The success of both the companies depends on each other cooperation and thus the comprehensiveness and transparency is very much needed. As they get established the success becomes obvious (99-101). Build-operate-transfer services The study is the way to find the importance and advantages of international cooperation among medium-sized construction firms. The planning was well organised and there constructed four functional departments for a better managerial services. It gives al possible ways in the fields of building and operating al kinds of transfer services on international marketing zone. The Beacon Construction Company too played many major roles in transforming the plans of TBC in complete structure. Its contributions towards the construction of al these plans led to the bigger perspective of success. There was the prominent building of delivery process management with outstanding and much better capabilities. This led to the dominance over the extended construction management and technological expertise by the implementation and planning (pp.50-51). The Rowes Wharf project was the exemplenary construction initiated by Beacon Construction Company6 with great success (Becker, 1991). It has been well discovered that due to limited resources have made the government agencies get inclined towards the non traditional procurement systems for all kinds of public projects. The dimensional aspects of such strategies are common all over the world and thus needs more innovation for more effective implementation. This is clearer in case s related to the Building-Operate –Transfer agreement to the mean that leads to the act of privatization (Reinhardt, 1993; Worenklein, 1994)7-8. As per Building International Construction Alliances by Roberto Pietroforte; the demand is for a much expandable scope of services along with the development of the new capabilities and innovative structural management skills (p.91). Design/build and package deal services As for Building International Construction Alliances by Roberto Pietroforte; these types of international construction alliances are getting mandatory and are very much necessary in today’s scenario. These are the means to have a well structured analytical background among the middle sized firms for developing long-term collaboration in the international market of designing or building of package deal services. There was a great development in the production- and technical-oriented culture by the means of various negotiated contacts for a very high quality projects (p.12). Under the application of constructing alliance the owner usually expected to go for a reduced price list. This is due to the increased constructability of the design of the allied firm with more efficient display of skill. The building of the international alliance has led Fratelli Dioguardi and Beacon Construction Company to have the optimum use of design and construction in the structural demonstration. There is a special recognition towards the affiliation towards the firms' skills and talents on international levels. Pre-construction services By the application and building of international construction alliances, Fratelli Dioguardi and Beacon Construction Company could establish a structured design-driven construction firm in the international basis. This is the way for a strong footage towards the state of pre-construction services. The growth in construction management depends a lot in the optimum use of available funds in the preconceived projects. This is equally important as there has to be the control of the scope of the work on international structure. The application and building of international construction alliances had developed many scopes for Fratelli Dioguardi and Beacon Construction Company. There is more systematic approach towards the project handling and scheduling. It has been found in Building International Construction Alliances by Roberto Pietroforte; that by the means of building consensus with city officials and planners, there is the scope for the establishment of a long term cooperative links with better architectural professionalism (p.46). It also paves the stone for a socially and architecturally structured reputation of the respective firm in the international marketing scenario. There was a kind of transparency between the two and so under pre-construction services there is the comprehensive understanding of each plan ad cultural differences between the two firms. This led to a better declarations between the two and added more prominences in their collaboration. Construction management services The purpose of building international construction alliance in the construction management services is a prominent establishment towards the construction management services of the middle sized firms like Fratelli Dioguardi and Beacon Construction Company. It directly acts towards the establishment of a very dominant periphery in the international marketing. There was a huge difference and expertise came, in the field of the development of a training function for management personnel. The initiation was taken by Gianfranco Dioguardi; a professor of industrial organization at the University of Bari (p.16). The major advantage of getting into an allied constructional unit lies in the involvement of a proper schedule. As a matter of fact, T Lendrum stated that on international constructing arrangements of a deal are in general bounded by an extremely tight time frame. In such cases the act of letting out the contract as a design-build contract is a difficult job for a middle sized firm9. The best possible solution thus can be getting into allied contract and thereby comes in the establishment of a reputed contractor. All kinds of mobilization and construction activities are processed more concurrently with prominent plans and design. The proper affiliated system of project management helps in motivating the whole organization to work with the design team, towards the development of a design with constructability in mental structure. Project management services As the historical evolution of both Fratelli Dioguardi and Beacon Construction Company gets demonstrated and analysed in Building International Construction Alliances by Roberto Pietroforte, we could very clearly find out how there is a big difference between their deals in the sector of project management services after the building of the alliance on international status. As the alliance happens between two well established firms, the proficiencies over the ways of maintaining finance too gets under well scrutinized eyes. The usefulness lies in the togetherness of the team in the field of creativity and in finding ways to reduce construction costs from the firm10. There is also enough space for the application of many devices in reducing the function of the final product. There was a tremendous development in the development of product and process innovation capabilities. This was aiming towards the most effective growths in the international scenario of project management services. There is a great change in the operation services too. As mentioned in Building International Construction Alliances by Roberto Pietroforte; there is a regular avoidance of delays in the transfer services. Great changes come up in the periphery of management disputes there comes in a great emphasis over the enhancing project design and construction quality by the alliance. The key towards the construction of alliance is the management of a long term ongoing cooperation. This is a very vital pint in the maintenance of success in the field of international exposure. This is attained with a dedicated zeal of the management towards the cooperative improvements. This also needs the perfect scope of learning from experiences. The amalgamation of these features leads to a predominant status of the firms that are under long term alliance. Property development and management services There is a great difference undertaken by Fratelli Dioguardi and Beacon Construction Company after the building of international construction of alliances. There is a tremendous development in their organizational and growth setting strategies. The purpose is to become an established internationally orientated and integrated firm from the national level of popularity. The alliance led to a bigger perspective of property development and management services. There was the inclusion of service- oriented projects, projects related to public utility along with the industrial facilities. There is also a contribution made towards the renovation projects of historic urban blocks and landmark buildings. According to M Porter, a design-build contract can have many kinds of advantages. This is the best process that may lead to the construction of a stronger managerial team in the firm. It is more appropriate especially for middle sized firms. The alliance builds up bigger perspective for them in this field and thus adds advantage in their working process of property development and management services11. In the aspect of property development and management services the vital roles are played on the grounds of trust and the corporate support. The corporate support is directly proportionate to the organizational resistance. This is the way towards a self sufficient entity and helps on drawing various businesses and projects to the firm. ‘Turf’ issues and misconceptions needs to be dealt with more intelligence and understanding. This is effective by the cooperation of the top management effort and thus is very tactical to handle. This requires more professional skills and experience for the maintenance of a long term commitment (p.115-6). CONCLUSION As stated by Roberto Pietroforte, the alliance between Fratelli Dioguardi S.p.A. and Beacon Construction Company is now in its fifth year and during this span the relation ship has grown stronger. The success came with the first joint project undertaken by them is the grand new Italian Chancery in Washington, D.C. (p.101).’ Though this effort has not been characterized on the systematic and perspective approach by CII report (Badger et al., 1993)12; still the emphasis is over the progress that this alliance has achieved in a series of efforts driven in more cooperative spirit and adjustments on international groundings. International construction of alliance acts as a great support in the expanding market structure. It is the way to have more properly structured concern for every possible and successful means. The privilege is to be in the market with more acts of sustainability and acceptance in the construction of alliance. The status of the construction market in highly developed in terms of economics. In the near future more and more firms will be in this particular way of alliance of Fatally Dioguardi and Beacon Construction Company. It will be a compulsion for many firms to expand their capabilities and diversify their services in order to survive in the highly competitive market. It will be a structure led more for survival on the basis of performance and strong economical footage. With a futuristic point of view, the practice of partnering and strategic alliances and seeking cooperative agreements with foreign firms will be the basis for stronger existence. It is very important to have equal amount of faith and trust between both the firms and that is the best way to prosper in the international competitive market. The purpose will be, to get more business and to give more deliverance. It will be the most supporting act in generating and increasing interest in the corporate planning departments of construction firms in every country throughout the world. REFERENCES Badger, W.W., Mulligan, D.E., Carter II, J.P., Gay, S.W., Held, M.S. and Markham, C.S. (1993) Alliances in International Construction, A Report to the Construction Industry Institute, CII Source Document 89, April. Becker, J.M. (1991), Controlling results through innovations, Construction Business Review, 1(3), 50-54 Child, John; David Faulkner (1998). Strategies of Co-operation: Managing Alliances, Networks and Joint Ventures, 386. ISBN 9780198774853. David C. Mowery, Joanne E. Oxley, Brian S. Silverman, Strategic Alliances and Interfirm Knowledge Transfer (1996) Strategic Management Journal, Vol. 17, Special Issue: Knowledge and the Firm (Winter, 1996), pp. 77-91 Doz Y. L., Hamel G., Alliance Advantage. The art of Creating Value through Partnering,Harward Business School Press, Boston, 1998, ISBN 0875846165. Kuglin, F.A.; J. Hook (2002). Building, Leading, and Managing Strategic Alliances: How to Work Effectively and Profitably With Partner Companies. American Management Association. Lendrum T., The Strategic Partnering Handbook, A Practice Guide for Managers, McGraw-Hill, Nook Company, 1997, ISBN 0074708791. Porter M., Competitive advantage: Creating and Sustaining Superior Performance, NY, Free Press, 1985, ISBN 0029250900. Reinhardt, W.G. (1993) Private financing for infrastructure. Worldwide Projects, 1 (1), 21-22, 24 Roberto Pietroforte, 1996, Building International Construction Alliances - Successful partnering for construction firms, Master eBook ISBN10 : 0-203-47696-4, Master eBook ISBN13 : 978-0-203-47696-3 Williamson, O., Markets and Hierarchies: Analysis and Antitrust Implications, Free Press, NY, 1975. Worklein, J.J. (1994) Careful project structuring, key to financing private power. Private Power Executive, 2 (5), 48-49 Yoshino and Rangan, Michael Y. and U. Srinivasa (1995). Strategic Alliances – An entrepreneurial approach to globalization, First Edition. Library of Congress Cataloging-in Publication Data. ISBN 0-87584-584-3. RECOMMENDATIONS Durkheim, The Division of Labor in Society, (1893) The Free Press reprint 1997, ISBN 0684836386 Lendrum T., The Strategic Partnering Handbook, A Practice Guide for Managers, McGraw-Hill, Nook Company, 1997, ISBN 0074708791. Scott, B. (2001) Partnering in Europe: Incentives based alliance for projects, London: Thomas Telford. Walker, D, Hampson, K and Peters, R. (2000) Relationship-Based Procurement Strategies for the 21st Century, Canberra: AusInfo. Read More