Contemporary Construction Industry Analysis - Case Study Example

Business in the modern world: Construction industry in the present age is developing at a speed, much greater than many other industries. Construction of a large number of buildings with innovative designs and rich architecture speaks of the rapid growth of the construction industry. However, construction is one of the most challenging jobs, and companies have to go through a lot of hard times in order to make it happen. Construction industry undoubtedly offers some of the most paying business opportunities. But in order to excel in this industry as a good company is not a bed of roses. “Corporate reputation, a key (albeit implicit) responsibility of business continuity managers for years, has become a topical and vital asset and risk for companies to manage.” (Binneman, 2006). Earning good reputation as a successful company in construction industry requires a lot of input from the owners. In the dynamic environment of the modern world, a company needs to be good at things more than just the end products, in order to satisfy the critiques and gain room and value in the business world. Modern age is an age of technology. Everybody is interconnected. Communication is frequent, meaningful and effective. In such an environment, it has become very essential for the companies in the market to earn a good reputation to progress in the market. Companies need to take care of professional ethics in their style of dealing and relationships with other companies, people and the society. “The adoption of a code of conduct is a fundamental step in the attempt to improve the ethical culture in todays business world”. (Rotta, 2007). They need to work in a way that would conform to the standards and requirements of the corporate social responsibility. The need of reputation management is increasing. Case study: To explain these concepts, it would be very appropriate to achieve this with the help of a practical situation. Therefore, a construction company named Bridgestone Construction Company is referred to in this case study. This construction firm is serving as a contractor on one of the mega projects in Pakistan. Name of the project is Canyon Views. It is a house-development project. The client of the project is EMAAR, and Kasif Aslam Associates (KAA) is serving as the consultant on the project. Project manager firm selected by EMAAR for the project is Turner Inc. all of the information has been collected from my friend who has served in the Bridgestone Construction Company as a Site Engineer for three months as a part of his internship. The project is currently in progress in DHA, Phase-2, Extension, near Islamabad Tool Plaza, Rawat, Islamabad, Pakistan. General reputation of the firm: The stakeholders’ perspective: My friend came to learn about the system of this firm during his thesis when he needed to carry out a research on different companies having bad public relations. He was supposed to work out the reasons and suggest necessary measures that would improve its reputation among the masses. Because of its “not-so-good” reputation as reflected in the journals and media, he decided to spend a couple of days as an engineer employed by that firm as a part of my internship. To his fortune, the General Manager agreed to offer him a chance to serve in his firm as a site engineer. He got a chance to spend three months with that firm. The very first day, he was warned by my co-engineers (who did not know by then that he had joined the firm only for three months for internship, and were considering him permanent) that he had made a wrong decision by joining that firm, because they thought that the environment and the system employed in that firm was not worth working in. They told him that the company had not lived up to the expectations of the client, and that the client was likely to terminate contract with that company because of its poor work quality, bad safety management, non-compliance with the client’s work schedule, nontechnical staff, cost overruns, lack of previous work experience in the similar field and work delays. They told him that the company was new in the construction industry and that it was likely to bear huge losses. According to them, the company was not worth joining, so they were themselves looking for jobs elsewhere, and were of the view that they would leave that company as soon as they found some other job. In addition to their view, he had personally observed some very odd factors that would support the kind of image, his coworkers had formerly conveyed to him. He observed that there were too many site meetings that would affect the work’s progress, and to him, not many of them were meaningful / necessary. All site engineers and foremen were supposed to be present in every meeting, and many of them were quite purposeless. Many times, it would so happen that they would keep waiting for the General Manager to come and convey his point for above an hour, and he would not come. Besides, he came across a few copies of previous Interim Payment Certificates (IPCs) and observed that a large amount of work accomplished was not approved by the consultant for payment because of bad work quality in the very items. In addition to that, he could hardly see any worker wearing helmets, safety shoes or other Personal Protective Equipment (PPE), which supported his perception that a very ineffective and poor site safety management system was employed in the working style of that company. To further investigate the matter, he inquired a few laborers and foremen about the company and asked them if they were satisfied with the environment it had provided them with to work in. Not many of them were of a view that would complement that of his coworkers. He also talked to a few supervisors from the consultant firm, and they had similar perceptions about his company. A few of them expressed that their firm had never worked with such an unprofessional company in the past. Thus, he drew the conclusion that all stakeholders thought in similar fashion about the Bridgestone Construction Company as he did. Causes of stakeholders’ claims: There were a number of reasons that would make the workers think the way they did. One of the reasons was a lack of employment of sound construction management practices in the company’s working style. The contractor was inexperienced and new in the construction industry. The company did not make a practicable work schedule in the start of the project. The schedule was rather ambiguous and impracticable. Management was faulty. Communication was very less. There were a lot of meaningless meetings to hinder the flow of work. The company had not invested in safety. Managers’ concern toward site safety was very less. The company was inexperienced and nonprofessional. The site engineers were not educated on the specifications of their work in accordance with the conditions of contract. Construction was commenced without issuance of construction drawings from the consultant in order to save time, which later led to demolition and rework, because the drawings when issued varied considerably when compared with the on-site construction. This caused schedule delays and cost overruns. Besides, there were many other factors which had inculcated a sense of disrespect for the company in the stakeholders. Measures to improve the company’s image: The company has unintentionally worsened its public relations and needs to take measures to develop good reputation in order to excel in the construction industry as a competent contracting firm. In order to achieve that, the company needs to modify its managerial system. First of all, hiring of a project manager educated and experienced in construction management, who would understand the weaknesses in the system and do all to set things right will be a very big step toward betterment. The company’s project manager needs to be competent enough to get a time extension explaining to the client that the delays so far have been due to the consultant’s delay in delivering construction drawings. Secondly, the project manager would need to reschedule the work from this point in time onwards. Communication means need to be quick and effective. “It is a strong assertion that good communication results in good business.” (Parker, 2010). The General Manager should convey the message electronically, to ensure in time delivery. Meetings should be as less as possible and concentration toward field work should be more. Contractor should invest money in purchasing insurances, site safety equipment and the Quality Control department needs to be developed. Managers should plan the changes strategically in a way that would improve its reputation among the masses. After every major development, the contractor should call the client and consultant for a joint site-visit, and gain acknowledgement. Without this, the efforts would go in vain and not favor the company in the public’s perspective. Conclusion: There should be more dependency on technology. “The reality, however, is that there are technologies out there right now which could save you money and help your business run smoothly.” (Rao, 2004). Communication is vital for a system to run efficiently. Frequent and timely communication is necessary in order to keep the stakeholders updated and well-informed, which is vital for rapid progress conforming to specifications. These days, various softwares are readily available in the market to facilitate the process of scheduling, cost estimation, administration and information delivery. Use of these softwares in the company would not only facilitate the work, but also earn the company the honor of being one of the most advanced companies in the field. The managers need to fulfill the need to update the system as per the requirements of the modern world in order to increase the work efficiency, and believe that the long term benefits are worth the investment in these areas. Additionally, it is the owners’ responsibility to publicize whatever good initiatives they take toward the betterment of the company, because this practice would earn the company good reputation, more work and enhanced public relations. “A reputation for strong ethics and solid business values will get far more clients.” (Ward, 2008). Resources: Binneman, D., 2006. “Guidelines for improving and protecting corporate reputation”. Available at: http://www.continuitycentral.com/feature0350.htm. (accessed: 21 March 2010). Parker, S., 2010. “It is a strong assertion that good communication results in good business.” Available at: http://www.streetdirectory.com/travel_guide/159512/software/the_benefits_of_modern_business_software.html. (accessed: 21 March 2010). Rotta, C. P., 2007. “Rules of behavior: the adoption of a code of conduct is a step toward improving the ethical culture in todays business world”. Available at: http://findarticles.com/p/articles/mi_m4153/is_3_64/ai_n19328584/. (accessed: 21 March 2010). Rao, V. P., 2004. “Technology & Your Business: A Beneficial Relationship”. Available at: http://www.cash-for-surveys.com/articles/technology-your-business-a-beneficial-relationship.html. (accessed: 21 March 2010). Ward, T. P., 2008. “Develop a Business Reputation: Strong Business Ethics Can Build Word of Mouth Referrals”. Available at: http://self-employedmarketing.suite101.com/arti cle.cfm/develop_a_business_reputation. (accessed: 21 March 2010). Read More