BORANG PENGESAHAN STATUS TESIS

Transcription

1 UNIVERSITI TEKNOLOGI MALAYSIA BORANG PENGESAHAN STATUS TESIS PSZ 19:16 (Pind.1/97) JUDUL : THE PERFORMANCE OF FELDA PLANTATIONS SDN. BHD. CONTRACTORS SESI PENGAJIAN : 2006/2007 Saya RAMZI BIN IBRAHIM (HURUF BESAR) mengaku membenarkan tesis (PSM/Sarjana/Doktor Falsafah)* ini disimpan di Perpustakaan Universiti Teknologi Malaysia dengan syarat-syarat kegunaan seperti berikut:- 1. Tesis adalah hakmilik Universiti Teknologi Malaysia 2. Perpustakaan Universiti Teknologi Malaysia dibenarkan membuat salinan untuk tujuan pengajian sahaja. 3. Perpustakaan dibenarkan membuat salinan tesis ini sebagai bahan pertukaran antara institusi pengajian tinggi. 4. **Sila tandakan ( ) SULIT TERHAD TIDAK TERHAD (Mengandungi maklumat yang berdarjah keselamatan atau kepentingan Malaysia seperti yang termaktub di dalam AKTA RAHSIA RASMI 1972) (Mengandungi maklumat TERHAD yang telah ditentukan oleh Organisasi/badan di mana penyelidikan dijalankan) Disahkan oleh: (TANDATANGAN PENULIS) (TANDATANGAN PENYELIA) Alamat Tetap: TINGKAT 8, BALAI FELDA, JALAN GURNEY 1, ASSOC. PROF. DR. MUHD ZAIMI ABD. MAJID KUALA LUMPUR. Nama Penyelia Tarikh : 19 hb. Mei 2006 Tarikh : 19hb. Mei 2006 CATATAN : * Potong yang tidak berkenaan ** Jika tesis ini SULIT atau TERHAD, sila lampirkan surat daripada pihak berkuasa/organisasi berkenaan dengan menyatakan sekali sebab dan tempoh tesis ini perlu dikelaskan sebagai SULIT atau TERHAD Tesis dimaksudkan sebagai tesis bagi Ijazah Doktor Falsafah dan Sarjana secara penyelidikan, atau disertasi bagi pengajian secara kerja kursus dan penjelidikan, atau Laporan Projek Sarjana Muda (PSM)

2 SUPERVISOR S DECLARATION I/We* declare that I/we* have read through this project report and to my/our* opinion this report is adequate in term of scope and quality for the purpose of awarding the degree of Master of Science (Construction Management) Signature :.. Name of Supervisor : Assoc. Prof. Dr. Muhd Zaimi Abd. Majid Date : 19 th May 2006

3 i THE PERFORMANCE OF FELDA PLANTATIONS SDN. BHD. CONTRACTORS RAMZI BIN IBRAHIM A project report submitted in partial fulfillment of the requirements for the award of the degree of Master of Science (Construction Management) Faculty of Civil Engineering Universiti Teknologi Malaysia MAY 2006

4 ii STUDENT S DECLARATION I declare that this project report entitled The Performance of Felda Plantations Sdn. Bhd. Contractors is the result of my own research except as cited in the references. The report has not been accepted for any degree and is not concurrently submitted in candidature of any other degree. Signature :.. Name : RAMZI BIN IBRAHIM Date : 19 th May 2006

5 iii Specially Dedicated To My Parents My Beloved Father and Mother You have done all the best for my life My Wife Puan Zalina Bt. Zakaria & Puan Normayati Mohd. Yassin Thank you for your love & supports My Childrens Nur Baiti bt. Ramzi Muhammad Faris Bin Ramzi Siti Nur Aisyah bt. Ramzi You re the heart of my life for my son and daughters I hope you all will be success and growing up as a good citizens and may Allah bless your peacefull life

6 iv ACKNOWLEDGEMENT In preparing this thesis, I was in contact with many people, academicians, managers, contractors and practitioners. They have contributed towards my understanding and thoughts. In particular, I wish to express my sincere appreciation to my supervisors, Associate Professor Dr. Muhd Zaimi bin Abd. Majid, for encouragement, guidance, critics and friendship. Without his continued support and interest, this thesis would not have been the same as presented here. I also deserve special thanks for Senior Executive Director, Felda Plantations Sdn. Bhd., En. Rusdi bin Ismail and Executive Director, Hj. Abd. Ghani Mahmood for their support and suggestion for this study. My sincere appreciations also extends to all my colleagues and others who provide assistance at various occasions, especially for Azizee bin. Ismail, Wan Zahran Wan Zakaria, Puan Rozita Aris and others. Their views and tips are useful indeed. Unfortunately, it is not possible to list all of them in this limited space. I am grateful to all my family members especially to my wife who always give me a warm support. Thank You.

7 v ABSTRACT Performance is the measure of the ability of the contractors to execute work on time, cost and quality. This study presents the result of the investigation on performance of the contractor that registered under Felda Plantations Sdn. Bhd based on workmanship. The objectives of the study are to identify the factors that influence the contractor s performance; to establish the critical factors that influence their performance; and to identify the strategies to improve the situation. The method of the study involved literature review, data collection and analysis is using an Average Index method. The result for this study is found that the three most important factors that influence the contractors performance were the experience and skilled worker; understand the method of work; and good planning and scheduling. The three best method to improve the contractor s performance were to focus on the client needs; meet the client requirements; and exceed the client expectation; to improve the method of supervision of labors work and to improve the planning and scheduling techniques. It is hope that this study will provide useful information on future work for contractors not only for their future jobs at Felda Plantations Sdn. Bhd. but to the benefit to the construction industry.

8 vi ABSTRAK Prestasi kerja kontraktor didefinasikan sebagai keupayaan kontraktor menjalankan kerja dengan mengamalkan pengurusan masa, kos dan kualiti yang berkesan. Kajian ini memberikan tumpuan terhadap keupayaan perstasi kerja kontraktor yang berdaftar dengan Felda Plantations Sdn. Bhd berdasarkan kualiti kerja yang telah ditunjukkan oleh mereka. Tujuan kajian ini adalah untuk mengenalpasti faktor yang mempengaruhi prestasi kerja kontraktor, mengenalpasti faktor kritikal yang mempengaruhi keupayaan prestasi kerja mereka serta mengenalpasti strategi bagi meningkatkan keupayaan prestasi sediada. Kaedah kajian yang dijalankan merangkumi kajian literatur, pengumpulan data dan seterusnya menganalisa data yang diperolehi dengan menggunakan kaedah ststistik. Keputusan kajian mendapati tiga faktor utama yang mempengaruhi mutu kerja atau prestasi kerja kontraktor adalah dengan menyediakan pekerja yang mahir dan berpengalaman, memahami kaedah carakerja yang akan dijalankan dan mengamalkan kaedah perancangan dan penjadualan kerja yang baik. Manakala tiga kaedah utama yang boleh diamalkan bagi meningkatkan prestasi kerja adalah dengan menumpukan dan fahami kehendak pelanggan, mempertingkatkan kaedah pengawasan kerja yang dijalankan oleh buruh dan meningkatkan kemahiran dalam kaedah merancang dan menjadualkan kerja. Adalah diharapkan kajian ini bakal menyediakan maklumat yang berguna bagi meningkatkan mutu kerja pada masa akan datang amnya bagi kerja-kerja di Felda Plantations Sdn. Bhd. dan bagi keseluruhan industri pembinaan umumnya.

9 vii TABLE OF CONTENT CHAPTER TITLE PAGE TITLE PAGE DECLARATION PAGE DEDICATION PAGE ACKNOWLEDGEMENT ABSTRACT ABSTRAK TABLE OF CONTENTS LIST OF TABLES LIST OF FIGURES LIST OF ABBREVIATIONS LIST OF APPENDICES i ii iii iv v vi vii xi xii xiii xiv CHAPTER 1 INTRODUCTION 1.1 Introduction Background of Study Problem Statement Aim and Objectives of Study Scope of Study Research Methodology Summary 6

10 viii CHAPTER 2 THE FACTORS THAT INFLUENCE THE CONTRACTORS PERFORMANCE 2.1 Introduction Definition The Quality Performance Standard The Project Management Factors Construction Product or Service Service Encounters Satisfaction and Quality Determinants of Service Quality Factors Involved in Contractor Satisfaction Understand the Client Needs and Quality Expected Good Knowledge in Planning & Scheduling Good Communication Between Supervisors and Workers The Critical Factors Influence The Contractors Performance Summary 24 CHAPTER 3 THE STRATEGY TO IMPROVE CONTRACTORS PERFORMANCE 3.1 Introduction Definition Strategies To Improve Contractor Performance Quality Quality Assurance and Quality Control 30

11 ix 3.6 Total Quality Management (TQM) Quality and Contractor Selection Selecting the Right Contractor Planning The Project Enquiries to Subcontractors and Suppliers Checklist for Subcontract invitation to Tender Scheduling the Work Keep a Job File Provide Training For Workers Improve the Method of Supervision of Labors Work Summary 46 CHAPTER 4 RESEARCH METHODOLOGY 4.1 Introduction Research Methodology Literature Review Data Collection Analysis of Data Summary 56 CHAPTER 5 DATA ANALYSIS AND RESULTS 5.1 Introduction Clients Background The Respondents Background 61

12 x 5.4 Result and Analysis The Result of Questionnaire Survey Findings and Discussion Suggestions For Better Performance Summary 80 CHAPTER 6 CONCLUSIONS AND RECOMMENDATION 6.1 Introduction Conclusions Recommendations Suggestion for Further Study 86 REFERENCES 87 APPENDICES APPENDIX A Felda Plantations Office Location 90 APPENDIX B Sample of Questionnaire Survey 91 APPENDIX C Sample of Contractor Selection Checklist 97 APPENDIX D Sample of Contractor s Evaluation Form 100

13 xi LIST OF TABLES TABLE NO. TITLE PAGE 4.1 The Factors That Influence The Contractor s Performance The Strategies To Improve The Contractor s Performance Felda Plantations Sdn. Bhd. Staff Strength Felda Plantations Authorized & Paid-up Capital Felda Plantations Sdn. Bhd. Shareholders Respondent Registration With Felda Plantations Sdn. Bhd Respondent Registration Under Relevant Bodies Respondent Registration With PKK Respondent Registration With CIDB Returned Questionnaire The Full Time Staff in the Contractor s Firm The Contractors Experience in Construction Industry The Company Manager s Qualifications The Respondent s Company Paid-Up Capital The Factors That Influence The Contractor s Performance The Critical Factors That Influence The Contractor s Performance The Strategies to improve contractor s Performance The Rank Factor s influence contractor s Performance The Rank Strategies to improve contractor s Performance 77

14 xii LIST OF FIGURES FIGURE NO. TITLE PAGE 1.1 Methodology Flow Chart Five Ordinal Measures of Contributing Factors of Likert Scale Felda Plantations Staff Strength Registeration of Contractors Under Felda Plantations Sdn. Bhd Registration of Respondent Under Relevant Bodies Registeration of Contractors Under PKK Registeration of Contractors Under CIDB Returned Questionnaire Full Time Staff Work Under Contractors The Contractors Experience in Construction Industry The Company Managers Qualification The Company Paip-Up Capital 70

15 xiii LIST OF ABBREVIATIONS CCM - Company Commission of Malaysia CIDB - Construction Industry Development Board CIOB - Chartered Institute of Buildings FPSB - Felda Plantations Sdn. Bhd. MOF - Ministry of Finance PKK - Pusar Khidmat Kontraktor

16 xiv LIST OF APPENDICES APPENDIX TITLE PAGE A Felda Plantations Sdn. Bhd. Location Plan 90 B Sample of Questionnaire 91 C Sample of Contractor Selection Checklist 97 D Sample of Contractor s Evaluation Report 100

17 1 CHAPTER 1 INTRODUCTION 1.1 Introduction The contractor performance issue is one of the milestone of identifying a contractor who can undertake the client s project, and take it to the satisfactory conclusion, that is to meet the client s time, cost and quality expectations. Most clients want superior quality performance, but at the same time they want the minimum price. The combination of quality performance and the service paid for that quality is the value received by the client. Satisfaction can be viewed in terms of process of expectancy disconfirmation, in which satisfaction is based largely on meeting or exceeding client s expectations. The construction industry in Malaysia is mostly characterized by a large number of small contractors and a relatively small number of large contractors that carry out most of the industry s workload. Sometimes the contractors incompetency in making the right decision to maintain the good quality performance of work to satisfy the clients needs and expectations.

18 2 1.2 Background of the Study The construction sector is vital for the development of any nation. It is without doubt that the task of physical nation buildings rest with the construction sector. In many ways, the pace of the economic growth of a nation can be measured by the degree of activity in the development for physical infrastructures such as roads, buildings and bridges. However, the need has never been felt more acutely now the quality is no longer an icing on the cake but an essential ingredient in the cake itself. The quality performance is vital not only for the purpose of marketing a company s products and services, but it is a life-line in the survival of the company itself. Through the implementation of quality systems and quality management practices, the safety of products and even of the workers in the factory and the worksite can be enhanced. The concern of quality performance also prevents rework and wastage thus reducing unproductive repetition of jobs and ultimately increases efficiency and productivity. The often forgotten objective in the project management is the performance target. This target is not just a technical specification. It is a translation of the customer s needs into performance criteria, and that the translation may be a technical specification. The concurrent project management requires that the customers be part of the entire process from concept through completion, with nextin-line being the operational definition of customer. Failure to meet the needs of the next-in-line is a violation of the practice of quality at the project level, (Lewis, 2005). Therefore, any attempt to formulate a strategy for improving the performance of the construction practice would require a reliable understanding of the past, present and probable situation of the industry.

19 3 1.3 Problem Statement Sometimes in the construction project, the contractor still cannot perform to the expectation (especially on the workmanship or the quality of work) although they had done many similar project before, some of them still cannot perform to the expected quality of work and deliver the final product to the client with satisfied workmanship. It is very sad to say that they only get the job and then manage by the third party or depends on the workers or sub-contractors. If they are lucky to get the good workers or sub-contractors they might finished the project on time with average standard of quality, if not, the project ending with the poor quality workmanship with lack of specification, delay and extension of time, carried to the termination of contract or the worst case ending with disputes. Some of them do not have any basic background knowledge in technical field especially in construction. 1.4 Aim and Objectives of Study The aim of this study is to investigate the quality performance (especially on workmanship) of the contractors which registered under Felda Plantations Sdn. Bhd. and how to improve their performance. To achieve this aim, three objectives are being delineated. Those are as follows: 1) To identify the factors that influence the performance of contractors; 2) To establish the critical factors that influence the performance of contractors; and 3) To identify the strategy to improve the contractor performance especially on quality of work or workmanship.

20 4 1.5 The Scope of Study The scope of this study is narrowed down to simplify the process of information gathering, so it can be analyzed within an appropriate time limit. The aspects being considered are: 1) Focused on the contractors which registered under Felda Plantations Sdn. Bhd. listed from the year 2004 to 30 th of June 2005; 2) The scope of work is on building construction projects such as public utilities, staff quarters and workers quarters; 3) The study focus on the quality performance; and 4) The area of this study is on engineering works in all Felda Plantations estate in Peninsular Malaysia. 1.6 Research Methodology The main focus of the study is to achieve earlier stated objectives through the collection of data using survey questionnaires and interviews, (Lee and Tan, 2003). The methodology is set to gather the data to achieving the outlined objectives. The first step of study is to rationalize the issue to set up the topic of study. Then the statement of problems, aims and objectives being developed. This study employed several methods of data collection for the purpose of objective s achievement. For the knowledge acquisition phase, the literature in connection with the study to be carried out is reviewed through journals, books, conference papers, magazines, and websites. From that information, a set of questionnaire form has been developed. The respondents are the contractors which registered under Felda Plantations Sdn. Bhd. in all class and the scheme managers. The data then analyzed using statistical

21 5 method. The final phase of the study is to define the conclusions and recommendation with reference to the objectives, subsequent to the analysis from the interview. The Methodology Flow Chart is as shown in Figure 1.1 below. Selected Topic of Study Er Statement of Problems Define Objective Literature Review The Factor Critical Factor Strategy to Improve Data Collection Interview Questionnaire Data Analysis & Result Conclusions & Recommendation Figure 1.1 : Methodology Flow Chart

22 6 1.7 Summary This study provides some valuable insights into the relative importance of the performance especially on the quality of works that the contractor have to maintain when executing their projects. The study is consist of six chapter. The first chapter is the introduction of the research, which include the statement of problems, the aim and objectives of the study, the scope and justification of the study, and research methodology. The Second Chapter is on literature review, focus on the identification the factors that influence the quality of performance of the contractors; Third Chapter continue with the literature review on method to improve the contractors performance. The fourth chapter is the Research Chapter that discuss the method of research. The data analysis and result is discussed in the Fifth Chapter, its consist of the background of the company, the project, the background of the contractors, the data analysis, result and findings. The Sixth Chapter is highlight the conclusions and the recommendation.

23 7 CHAPTER 2 FACTORS THAT INFLUENCE THE CONTRACTORS PERFORMANCE 2.1 Introduction This chapter identifies the factors that influence the contractors performance, establish the definition of the performance, workmanship and quality from the review. The factors that influence the contractors performance to be discussed related to the project performance factors, customer s satisfaction, determinants of service quality, understand the customer s needs and expectation, the needs of planning and scheduling and the needs of good communication. This chapter also highlights the critical factors that influence the contractor s performance.

24 8 2.2 Definition a. Performance Performance is the measure of the ability of the contractors to execute work on time, cost and quality. Performance is the way a contractor responds to the workload. Performance tools are able to monitor system variables and provide instantaneous or historical feedback on the way the system has dealt with the workload. There are several aspects to performance, and the objective to getting most from the system is to keep each of the components in balance, not allowing any to become a bottleneck, (Wong,2002). c. Workmanship The workmanship is define the performance of the contractor to conduct the work with good quality which meet the satisfaction to the client or customer, (Wong,2002). d. Quality Quality is defined as meeting or exceeding the needs of the customer. Quality in construction is achieve by meeting the customer s requirements in the best possible way, ( Schexnayder and Mayo, 2004). e. Quality Assurance Quality Assurance ( QA ) refers to the management systems employed by

25 9 construction companies to produce high-quality work consistently, (Schexnayder and Mayo, 2004). f. Quality Control Quality control is about the inspection of work to ensure it meets the quality standards specified in the contract, (Schexnayder and Mayo, 2004) 2.3 The Quality Performance Standard Arizona Registrar of Contractors in their website on stated the quality performance standard by the rule as; a) All work shall be performed in a professional and workmanlike manner; b) All work shall be performed in accordance with any applicable building codes and professional industry standards; and c) All work performed in any country, city or town which has not adopted building codes or where any adopted building codes do not contain specific provisions applicable so that aspect of construction, work shall be performed in accordance with professional industry standards The Performance Objective The often-forgotten objective in project management is the performance target. This target is not just a technical specification. It is a translation of the customer s needs into the performance criteria, and that translation may be a

26 10 technical translation. Concurrent project management requires that the customer be part of the entire process from concept through completion, with next-in-line being the operational definition of the customer. Failure to meet the needs of the next-inline is a violation of the practice of quality at the project level. The contemporary approach employed is Quality Function Deployment (QFD), (Lewis, 2005). 2.4 The Project Performance Factors Minchin and Smith (2005), Identified five major project management factor and one major materials and workmanship factor for project quality that address the primary interest of the owners and contractor. In all cases, the participants in the focus groups and surveys considered contractor quality performance to include the contractor s management quality as important to project quality, in addition to workmanship and material quality. a. Project Performance: Project Management Factors The management factors came under the following headings: Project Personnel Project Management/Control Schedule Adherence Contractor s Organization Plant and Equipment

27 11 b. Project Performance: Materials and Workmanship Factor The factor dealing with material quality and workmanship is taken from the result of test. Workmanship is measured on several work items such as smoothness, material density etc. To ensure as accurate a measure as possible, only the initial test result were include in the project summation. Specifications and acceptance procedures generally allow the contractor to rework the failed area until it passes or, under some specifications, a payment modification may be applied. The objective was to measure the effectiveness of the contractor to do the work right the first time. c. Overall Project Performance Factor In the original list of performance factors, one that relates to the quality of materials and workmanship is Final Product. 2.5 Construction Product or Service Maloney (2002), when most people think of construction, they think of what is actually built or the physical structure or product. The physical product is what is detailed in the plans and specifications provided by the designer. In construction, this would consist of series of systems that are constructed; for example, foundation, structure, electrical, mechanical, roofing and so on. It is what is in place after the work has been completed and the contractor and his or her forces have left the site.

28 12 There is no natural demand for the construction product; the demand for the construction product is derived from the demand for the intended use of the facility. The client s primary concerns are when the facility will be available and what it will cost. These two factors significantly influence the economic viability of the project. Completion of the project in accordance with the plans and specifications within budget and on time will satisfy the client s need and allow the contractor to make profit. However, it will not guarantee the contractor future work with that client. In providing the physical product, the contractor provides a service that consist of three elements; service product, service environment, and service delivery. The service product is the service as it is design to be delivered, which often includes specific features. It is also involves service specifications and targets. Features can be such things as schedule, progress report, quality assurance, warranties and so on. The service product includes what the client receives in addition to the physical product. The key managerial decision in designing the service product is the identification of the relevant features of specification to offer. The service environment includes numerous dimensions that can be classified into two main themes, that of the internal environment (the service provider) and that of the external environment. The internal environment is the organizational culture and overriding philosophy brought to service provision by management. Evidence of the internal environment is provided by the attitudes and actions of the employees of the contractor, both craft and management. The importance attached to the customer and his or her place in the values of the contractor are major determinants of the internal service environment.

29 13 The external environment is characterized by the availability of sufficient numbers of the appropriate tools and equipment in good operating conditions, a clean, well-organized on-site facility, and material that is available as needed. The service delivery can be likened to the performance of roles in theoretical scripts. Consumers are thought to posses expected sequences of events and provider role expectations within most service encounters. For example, the customer visits the job site and during the visit ask a question of a craftsman on the job. The customer has the expectation that the craftsman, in his or her role, will respond in courteous, informative manner. If the craftsman fail to do so, the customer s role expectation are violated ant the customer will not satisfied. 2.6 Service Encounters Satisfaction and Quality Maloney (2002), stated that the contractor and his or her personnel interact with the customer through service encounters, which may be defined as that period of time during the customer and service firm interact in person, over telephone, or through other media. It has been termed by marketing professionals as the moment of truth. Each service encounter provides an opportunity for the contractor to reinforce its commitment to customer satisfaction or quality. The customer s evaluation of each encounter will clearly not be perfectly related to the customer s overall satisfaction with the contractor or perceptions of the contractor s quality. However, over time it is likely that multiple positive (negative) encounters will lead to an overall high (low) level of satisfaction. Thus, customer satisfaction must be considered at both the micro and macro levels.

30 14 Service encounter satisfaction is the customer s satisfaction or dissatisfaction with a specific service encounter. Overall service satisfaction is the customer s overall satisfaction or dissatisfaction with the organization based on all encounters and experiences with that particular organization. It reflects satisfaction or dissatisfaction with a number of types of encounters (encounters with personnel, quotations, negotiations, delivery, and post-contract award services) within the same firm. Customers will distinguish their satisfaction with a particular encounter form their overall satisfaction with the firm s services. In addition to satisfaction, an issue of major concern to the customer is service quality, which may be defined as the customer s overall impression of the relative inferiority or superiority of the organization and its services. Most customers want superior service quality and the price paid for that quality is the value received by the customer. Satisfaction can be viewed in terms of a process of expectancy disconfirmation, in which satisfaction is based largely on meeting or exceeding expectations. 2.7 Determinants of Service Quality Access; involves approachability and ease of contact. This factor deals with the customer perceptions of the willingness of the contractor s personnel to meet with the customer and how easy it is to actually contact the appropriate contractor personnel. It deals with such things as the contractor s personnel s availability to meet with the customer and how quickly and easily the customer can contact the appropriate contractor personnel. When the customer has a problem or question, he

31 15 or she wants it resolved quickly. If it takes the customer several days to reach the appropriate person in the contractor s organization, the customer will not be pleased. This is not to say that the customer must be able to reach the person instantaneously, but simply within reasonable time. Access can be viewed as bidirectional. It is good business sense for the contractor and his or her personnel to maintain contact with the customer. Phone calla and visits to the customer provide ready access. Contact between the customer and contractor should not be initiated solely by the customer. Communication means keeping the customers informed in language they can understand and listening to them. It involves explaining the service itself; explaining how much it cost; explaining the trade-offs between service and cost; and assuring the customer that a problem will be handled. One of major concerns of customers is the uncertainty- for example, with the completion date associated with any construction projects. In general, construction customers are not experts in construction. At the same time, the customer is making a significant financial investment in the project that is being constructed. The contractor, through effective communication, can reduce the customer s uncertainty and thereby increase the customer s satisfaction with the contractor and the contractor s performance. Competence means possession of the required skills and knowledge to perform the service and involves the knowledge and skills of the craft workers performing the construction work, the personnel supervising those craft workers, and the personnel that come into contact with the customer.

32 16 The customer for any construction project wants the project built in a costeffective and safe manner, on schedule, and with appropriate quality. This requires the people performing the work to posses sufficient skills to meet these objectives. The acquisition of the necessary skills requires training and the opportunity to develop those skills. Without these skills, cost escalates, accident occur, schedules slide, and poor quality work is performed. The competence of the workforce can be demonstrated by the training programs completed. In addition to the technical competence of the craft workers, contractor supervisory personnel must have the knowledge, skills, and abilities to manage the construction work and supervise craft personnel effectively. Absent those skills, craft-worker productivity deteriorates. Construction work requires the effective interaction of the personnel performing the work. The effectiveness of this interaction is a function of the interpersonal skills of the individuals involved in that interaction. Thus, interpersonal skills are another in the set of competencies of construction workers. The last set of skills necessary to influence the customer s perception of services quality is those skills utilized in the interaction between the contractor s personnel and the customer. The contact personnel must be trained to interact with the customer, anticipate the customer s needs, answer the customer s questions, and so on. How the contractor s personnel interact with the customer significantly influences the customer s perceptions of the quality of the services. Courtesy involves politeness, respect, consideration, and friendliness of contact personnel as well as other factors such as consideration for the customer property. The key to courtesy is god interpersonal skills and respect for the

33 17 customer. Courtesy extends beyond person-to-person interaction. Consideration and respect for the customer s property are just as important. Credibility involves trustworthiness, believability, and honesty; it involves having the customer s best interest at heart. Contributing to credibility are company name, company reputation, personal characteristics of the contact personnel and the degree of hard sell involved in interaction with the customer. Credibility involves doing what you say you are going to do. In today s business world, the customer who hears sorry about that is not a satisfied customer. A contractor who is awarded a job base on a bid and then attempts to increase the value of the contract and his or her profits through continuous claims for extras will suffer a loss of credibility. Reliability involves consistency of performance and dependability. To be reliable, the contractor and his or her personnel perform the service right the first time, honor their promises, are accurate in billing, keeps record correctly, and perform the service at the designated time. Responsiveness is the concerns of the willingness or readiness of employees to provide service and involves timeless of service, calling back the customer quickly, and giving prompt service. Customers have needs. The contractor s ability to respond to those needs in a timely manner and with an attitude of wanting to be of service has a significant influence on the customer s perceptions of the contractor and the quality of the contractor s service. Service is freedom from danger, risk, or doubt; it involves physical safety, financial security, and confidentiality. The importance of security to a customer varies by project. Depending upon the size of a project relative to the size of the

34 18 customer, the failure to complete the project on time, within budget, and with appropriate quality may negatively impact the financial security of the customer. Tangibles include the physical facilities, appearance of the personnel, tools or equipment used to provide the service, and physical representations of he service; for example, the progress payment application. The customer s perception of the contractor s tools, equipment, and site organization is a significant influence on the customer s perception of the quality of the services provide by the contractor. Understanding and knowing the customer involves making the effort to understand the customer s needs by learning the customer s specific requirements, providing individualized attention, and recognizing the regular customer. To effectively satisfy a customer, all of the contractor s personnel must understand the customer s needs and requirements. In addition, the personnel must perform in a way that addresses those requirements. A customer who perceives that the contractor s personnel understand his or her requirements and are working to satisfy those requirements will perceive the contractor s efforts positively. 2.8 Factors Involved in Contractor Satisfaction Maloney (2002), stated that the factors that involve in contractor selection and satisfaction that can influence the performance of the contractors: a) Contractor/Customer relationship: Customers view a contractor in terms of trust, respect, integrity, willingness to partner, responsiveness, and communication ability;

35 19 b) Project Management: Ability to plan, schedule, manage and execute all aspect of project from the conceptual design stage to project completion; c) Safety: The contractor understands and follows all safety regulations, maintain a safe work environment, and employs workers who practice safe work habits; d) Prepared/Skilled workforce: The contractor staffs a project with employees who are knowledgeable, skilled in construction techniques, take pride in quality work and understand the method of work; e) Cost: Professionally manages all project cost activities, including initial project estimates, value engineering services, lower cost alternatives, change-order pricing, and project billing activities; and f) General Satisfaction: satisfied the customer with the good performance. 2.9 Understand the client needs and quality expectation The first order of business in today s world must be meeting the needs of customers (the next-in-line ). If this is to be done in project/construction management, the next-in-line must be identified and his or her needs defined. The first is, first of all, identifying just who is the customer in the first place. Then there is defining needs. Often, customers have an itch that they want scratched. That

36 20 is the best definition they can offer. They want the product to be easy to use. They want convenience. These basic itches must be translated into product or service features. We can say that solutions are developed for customer needs. We all know that the primary motive of a business is to make a profit, but as someone has said, the customer is the only person who gives you the money that becomes your profits. Your stockholders don t do it. Only the customer creates profits. So the first order of business is to find someone who is willing to be our customer. Without customers, we are dead. One important point is that we want to do more than necessary to satisfy customer needs, since that is wasting money. On the other hand, we do not want to do less than necessary, or we may lose the customer, (Lewis, 2005). The contemporary approach to translating customer needs into product features is Quality Function Deployment (QFD). Since QFD is outside this research, the reader is advice to referred to Dimancescu (1992) or Juran (1989)-see references, who explain how the process works Good Knowledge in Planning & Scheduling Planning needs to be organized, logical, efficient and thorough, to think about all aspects of the project in advance, anticipate foreseeable problems. Project structuring must be divided into logical, useful and controllable parts. Tan (2004), stated the role in planning were: a) Develop planning focused on the work to be performed;

37 21 b) Establish project objectives and performance requirements early so everyone involved knows what is required; c) Involve all discipline managers and key staff members in the process of planning; d) Establish clear and well-defined milestones in the project so all concerned will know what is to be accomplished, and when it is to be completed; e) Build contingencies into the plan to provide a reserve in the schedule for unforeseen future problems; f) Avoid reprogramming or re-planning the project unless necessary; g) Prepare formal agreements with appropriate parties whenever there is a change in the projects and establish methods to control changes; h) Communicate the project plan to clearly define individual responsibilities, schedules and budgets; and i) Remember that the best prepared plans are worthless unless they are implemented. Where, the desired results in project planning were: a) Finish project on time; b) Continuous (uninterrupted) flow of work (no delays); c) Reduce amount of rework (least amount of changes); d) Minimize confusion and misunderstandings; e) Increase knowledge of status of project by everyone; f) Meaningful and timely reports to management; g) You run the project instead of the project running you; h) Knowledge of scheduled times of key parts of the project; i) Knowledge of distribution of costs of the project; j) Accountability of people, defined responsibility/authority; k) Clear understanding of who does what, when and how much; and l) Integration of all work to ensure a quality project for the owner.

38 Good communication between supervisors and workers Communication is the sharing of information between two or more individuals or groups to reach common understanding, (Jones and George, 2003). A significant aspect of a project manager s job is to communicate to his or her people the objectives or purpose of the project. In many cases, the communication breakdown happens because the managers often communicate in one direction only. They do not take time to be sure that the person with whom they are communicating actually understood the massage. Rather, they assume that everything was clear. In fact, there seems to be a belief among managers that if they are fairly good at expressing themselves, then this is all that is needed to make them good communicators 2.12 The critical Factors influence the contractors performance The listed below are some of the critical factors that influence the workmanship of the contractors: a) Good planning and scheduling techniques of work and resources; b) Qualified and very well experienced workers; c) Well understand the method of work; d) Good communication between project supervisor and site workers; e) Used the quality materials as stated in the specifications; f) Well understand of specifications and working drawings;

39 23 g) The competence full time site supervisors in charge the project; h) Understand the client needs and the quality expected by the client; i) Financial strong and good financial cash flow; and j) Own the machine and logistic. Tan, (2004), listed the critical success factors in development and construction and summarized into the following: a) Definition of client s corporate and project goals; b) Financial and functional definitions ( end-user need ); c) Setting high standards and parameters for design, supervision and construction; d) Accurate fixation of a preliminary budget; e) Proper budgeting and cost control; and f) Strategic, effective and efficient project management, planning & control.

40 Summary There are many factors that influence the performance of the most construction projects, from the literature research that have been made by the author some factors were identified such as owns plant, machinery and equipments; provide competent site supervisors full time at site; maintain financial competence and good cash flow; use the quality materials; understand the drawing and specifications; understand the client needs and quality expected; used or hire experienced and skilled workers; understand the method of work; practice the good planning and scheduling technique; and practice a good communication between supervisors and workers. The critical factors that influence the contractor s workmanship sometimes related to the mentality of the contractor himself. Some of them have the low morale and not able to learn to improve their knowledge.

41 25 CHAPTER 3 THE STRATEGIES TO IMPROVE CONTRACTORS PERFORMANCE 3.1 Introduction This chapter highlight the strategies to improve the contractor performance in not only depends on the contractors itself but also depends on how the client select the right and competence contractor to do the job. On the contractor s side, they should able to provide a competence staff, the right planning of the works, healthy financial abilities and the aim to improve their knowledge. This chapter discusses the definition of planning, performance improvement, the quality needed, quality assurance, total quality management, the characteristic of goon planning, training and how to select the good contractors.

42 Planning Definition Planning can be thought of as determining what is going to be done, how, where, by whom, and when. In construction projects the plans (blueprint) and specifications for the project generally define both the end product and, often, the general time frame in which to complete the project. However, they normally do not specifically identify the individual steps, their order, and the timing followed to achieve the end product. Thus, when we discuss planning in the construction process, we must address the how and, therefore, the what, when, where, and who, ( Hinze, 1998 ). 3.3 Strategies to Improve Contractors Performance a. Performance Improvement The only way to know if the goals are being met is to have accurate, clear, and practical information about performance. Once that information is available, decisions can be made and actions can be taken. activities: The performance-driven system of improvement incorporates the following Defect-based inspection Data analysis Information sharing and reporting Operations and process improvement

43 27 Through these activities, the contractor have to seeks to identify and enhance the performance to meet and exceed client expectations. The result of this effort is greater value through ever increasing of quality of workmanship and customer satisfaction at a fixed cost. b. Defect Base Item Inspection The contractor should invest extensive time to train and test supervision staff and monitored on a regular basis to ensure accuracy as well as increase their knowledge base, enabling them to bring more value to clients. c. Data Analysis Analyzing the data from the inspection is the next step of the performance improvement process. The contractor s supervision staff can use the computers to gather item information, which is sent via modem to headquarters. Using the specific software, we can turn the data into useful performance information. The goal of this analysis is to answer two key questions: Is our client getting the performance they are paying for?; and How can the contractor improve their operations and processes? d. Information Sharing and Reporting Once the inspection data has been analyzed, it is presented to the client in the form of a performance report. In narratives and graphs and customer satisfaction results are shown.

44 28 Beyond the general facts and conclusions the report provides, detailed backup reports allow both the client and contractor to conduct more detailed investigation into areas of concern or interest. 3.4 Quality Schexnayder and Mayo (2004), defined the quality in construction as meeting or exceeding the needs of the customer. Everyone should recognized that intrinsic quality does not exist in construction, in the sense that some products are simply better than others. The shop drawing process is used to control the quality of the materials used by ensuring each installed product meets the requirements of the specifications. In spite of that, some contractors have a reputation for being highquality contractors, while others are still working on their quality reputation. Quality in construction includes ensuring the facility will perform its intended purposes. There has been a growing worldwide emphasis on quality in all industries, and in construction in particular. International quality standards are increasingly defined by the ISO 9000 standards. ISO is important because it offers an internationally recognized systemic approach. The principles advocated by ISO 9000 provide the framework for managing a quality system. Those principles are: a) Focus on your customers, organizations rely on customers. Therefore, Organization must understand customer needs. Organization must meet customer requirements.

45 29 Organization must exceed customer expectations. b) Provide Leadership, Organization rely on leaders, Therefore, Leaders must establish a unity of purpose and set the direction the organization should take. Leaders must create an environment that encourages people to achieve the organization s objectives. c) Involve your people, Organization rely on people. Therefore, Organization must encourage the involvement of people at all levels. Organization must help people to develop and use their abilities. d) Use a process approach, Organizations are more efficient and effective when they use a process approach. Therefore, Organizations must use a process approach to manage activities and related resources. e) Take a system approach, Organizations are more efficient and effective when they use a systems approach. Therefore, Organizations must identify interrelated processes that treat them as a system. Organizations must use a systems approach to manage their interrelated processes. f) Encourage continual improvement. Organization are more efficient and effective when continually try to improve. Therefore,

46 30 Organization must make a permanent commitment to continually improve their overall performance. g) Get the fact before you decide. Organizations perform better when their decisions are based on facts. Therefore, Organizations must base decisions on the analysis of factual information and data. h) Work with your suppliers, Organizations depend on their suppliers to help them create value, Therefore, Organizations must maintain a mutually beneficial relationship with their suppliers. 3.5 Quality Assurance and Quality Control Schexnayder and Mayo (2004), stated that quality assurance and quality control are two different concepts. Quality Assurance (QA) refers to the management systems employed by construction companies to produce high-quality work consistently. Meanwhile the quality control (QC) is about the inspection of work to ensure it meets the quality standards specified in the contract. QA/QC is a common abbreviation used by engineers and contractors. It ought not to be used because QA and QC are different. QA is made up of good management practice. QC is an inspection or sampling process. Consider the implications of the contractor with a reputation for producing low-quality construction, which would be the obvious result of ignoring QA, or

47 31 cutting too many corners, or using only untrained low-paid workers. Some believe they can make a better profit by working fast with untrained crews, and moving on to the next job as soon as possible. Such contractors ignore the complaints of their customers because they intend to get the next job by being the lowest bidder. The low bid system does not usually contain incentives for contractors to produce highquality work. Many owners believe that any contractor will produce the same facility, given the same set of plans and specifications. It is an attitude that is fed by the low bid system. Good contractors prefer to negotiate for work because they cannot distinguish themselves on low bid projects. 3.6 Total Quality Management ( TQM ) Total Quality Management (TQM) is a system of constant improvement, first promote by Deming (2004). He claims that American companies lose market share, and their jobs, because they fail to plan for the future. The key to understanding TQM is to first understand that the objective is continuous improvements. TQM is built on a foundation of; a) A well-defined vision and mission that everyone understands. b) Upper management commitment and leadership in quality matters c) Training. From those three components, companies build better communications and teamwork, which leads to four important factors; a) Customer satisfaction b) Improved supplier management

48 32 c) Process improvement d) Focus on employees The umbrella over these factor is continuous improvement. Chew and Chai (1996), stated that many Malaysian companies, particularly, the small and medium-sized companies are still practicing the traditional concept of quality control, i.e. quality by inspection. Very few are aware or understand the terms Quality Assurance, Quality Systems and Total Quality Management. It is often found that managers of these organizations practice the inspect in quality concept by carrying out inspection-oriented quality control on incoming materials and components, in-process intermediate products and final products. Other reasons that can be attributed to the failure to achieve the requirements of the standards are as follows: a) Lack of the infrastructure necessary to achieve the system b) Lack of clear directions, i.e. absence of a quality policy and quality objectives c) Lack of necessary documentation such as procedures, work instructions and records d) Lack of clear lines of authority and responsibility e) Lack of suitability trained personnel

49 Quality and Contractor Selection The owner s greatest impact on quality is through contractor selection. Private owners do not resort to using the low bid system because they know that the system can produce the poorest construction quality, with the greatest number of change orders, claims and litigation. Most private owners negotiate from a short list of preferred contractors. Some agencies are also trying different contracting methods which called performance-based procurement, in which contractor selection is based on past performance, quality history, management plant for the project, and price. As in any changing system, there are proponents and there are opponents foe every potential change, but something has to replace the low bid system. As comfortable as we are with the low bid system, most observers agree that quality of construction cannot improve without eliminating the low bid system. Whether that change will be to the best value procurement, competitive negotiation, construction manager at risk, or some other concept, remains to be sorted out. Do it right the first time is a quality motto that is used in most good construction companies. Companies loose money when they start having to tear out work because they failed to do it right the first time. Replacing work changes the schedule, doubles or triples the cost of the work, and destroys pride and morale. Doing it right the first time is the connection between quality and productivity. Highly productive crews know how to do it right the first time. In part, they are productive because they do it right the first time

50 Selecting The Right Contractor On behalf of client, to maintain a good quality of workmanship, the best way is to select the right contractor. As for the contractor, they can use this criteria as their guidelines to improve their performance. Chew (2003), listed seven most effective way of selecting a contractor to carry out construction work, they are describes as follows: a) Tender Price, which is derived after price adjustments and life-cycle cost evaluation; b) Time to completion, which is derived from analysis of how realistic the submitted work programmed can achieve the milestones in the project; c) Quality of product(s) as demonstrated by the product(s) offered, by a high level of coherence and internal consistency in the technical particulars to meet the specifications and by the technical and performance; d) Technical and organizational competence, which is shown in their proposed assignment of adequate and right people ( as seen in the submitted resumes of the key people ) and the use of experience subcontractors to work on the project, how the organization of the project team reflects the understanding of the key cause and effect relationship in the project and how the managements approach could enhance the construction process of the project; e) Financial competence, which is indicated by financial robustness and adequacy of funds to maintain financial health for seeing the project through or indications of the ability to deal with any unforeseen financial impacts on the projects;

51 35 f) Past performance, of projects of similar size, complexity and nature that have been executed successfully thus giving an indication of the experience and knowledge that can be brought into the project execution; and g) Relationship, in respect of the contractor s ability and willingness to sustain a quality business relationship based on pre-existing knowledge and experience and through the attitude and the responses revealed during tender clarification, and the indications of commitment and faithfulness to complete the project. 3.9 Planning The Project In order to minimize the chances that we will have a problem with the project, the contractor should understand that planning is the first step in the process. When planning the project, be sure to consider energy efficiency. An energy-efficient home or building costs less to heat or cool, is quieter and more comfortable, and will sell faster and at a higher price. Prerequisite to Planning Before a plan can be prepared the following should be done: Decide what is the objective; Find all relevant facts and information and analyze them; Consider the facts in the light of future trends and outside influences and use foresight; and

52 36 Consider the resources available, work already in hand or plans being prepared and take account of this. Characteristics of a good plan These should include the following: a) Be based on a clearly defined objective and must be practicable; b) Be simple and easily understood by all; c) Be flexible to accommodate future changes when necessary; d) Provide continuity of work: show how various stages are linked; e) Provide for easy control by establishing standards for comparison; f) Be orderly/sequential; g) Exploit existing resources to the maximum before new resources are obtained; h) Be definite in its requirements; i) Be arranged in a series of steps to be taken in sequence, each step being a miniature objective in itself; j) Be made in conjunction with those concerned and have their approval; k) Be made with the help of those who are to carry it out; l) Incorporate all old and new plans to cover the total new objective; m) Consist of one master plan incorporating all sub-plans; and n) Be arranged in stages that which is definite, that which is probable and that which is tentative/flexible.

53 37 Reason for Planning Generally, planning elicits commitment, instills discipline, and produces results. Tangible reasons for planning include the following: a) To aid contract control; b) To establish realistic standards; c) To monitor performance in terms of output, time and money; and d) To keep the project under constant review, and take action when necessary to correct the situation. Suggestion for effective planning Tan (2004), stated that the suggestion for effective planning are as follows: a) Plan to plan. It is always difficult to get people together to develop a plan. The planning session itself should be planned or it may turn into a totally disorganized meeting of the type that plagues many organizations; b) The people who must implement a plan should participate in preparing it; c) The first rule of planning is to be prepared to replan. No one has 20/20 foresight. Unexpected obstacles will undoubtedly crop up; d) Because unexpected obstacles will crop up, always conduct a risk analysis to anticipate the more likely ones. Develop a plan B just in case Plan A doesn t work. Why not just use Plan B in the first place? Because Plan A is better, but has a few weaknesses. Plan B has

54 38 weaknesses also, but they must be different than those in Plan A, or there is no use in considering it a backup; e) Begin with definition of the purposes of doing whatever is to be done. Develop a problem statement. All actions in an organization should be taken to achieve a result, which is another way of saying, solve a problem. If this step is skipped, you may find yourself developing the right solution to the wrong problem; and f) Use the Work Breakdown Structure to divide the work into smaller chunks that can have accurate estimates developed for duration, cost, and resource requirements. Stages Of the Planning Process No two companies undertake the same procedures, but the various stages of planning will be much the same whatever the size of business. For convenience, the planning process may be thought of as three distinct stages: a) Pre-tender planning: The planning considerations during the preparation of an estimate and its conversion into a commercial bid; b) Pre-contract planning: The planning process that takes place prior to the commencement of work on site; and c) Contract planning: This is required to be implemented in order to maintain control and ensure that the project is completed on time and within the cost limits established at the tender stage.

55 39 Project Planning Steps The Basic planning steps and the resulting documents stated by Lewis (2005), that must be generated are as follows: a) Define the problem to solve by the project. This yields a problem statement; b) Develop a mission statement (when appropriate), followed by statements of major objectives; c) Develop a project strategy; d) Write a scope statement to define project boundaries (what will and will not be done); e) Develop a Work Breakdown Structure (WBS); f) Using the WBS, estimate activity durations, resource requirements, and costs (as appropriate for your environments); g) Prepare the project master schedule and budget; h) Decide on the project organization structure whether matrix or hierarchical; i) Set up project notebook; and j) Get the plan signed off by all project stakeholders Enquiries to subcontractors and suppliers When tendering for jobs, most contracting organizations usually make enquiries to subcontractors and suppliers, asking them to tender for the execution of various trades as indicated in the bills of quantities. The main contractor may wish to retain those aspects of the works for which they specialize on, or those aspects of

56 40 the work which execution are critical to the success of the project. However, some organizations may wish to obtain tenders from subcontractors for all the trades, using these tenders as basis for comparing their own estimates. In making the enquiries, the main contractor extracts the relevant trades or sections of the bills and contract information (drawings, specifications, form of contract, etc), and dispatches these to the respective trade subcontractors. Each subcontractor submits a tender sum and requirements for preliminaries or temporary works which the contractor must provide. The main contractor sums up the subcontractors tenders, and add his profit and overhead to arrive at this his own bid for the job. The Chartered Institute of Building (CIOB) Code of Estimating Practice identify what information should be contained in the contractor s enquiry to a subcontractor. The Code proposes a checklist which is summarized as follows: 3.11 Checklist for subcontract invitation to tender: a) Details of main contract works: Job title and location of site; Name of employer; Names of consultants; and General description of the works. b) Subcontract works: Relevant extracts from the bills of quantities and specification; Extracts from the contract preliminaries section; Copies of relevant drawings; Details of where original documents may be inspected;

57 41 Time period for the completion of subcontract work (if known); Approximate dates when subcontract work will be undertaken; and Names of adjudicator (in case of dispute). c) Subcontractor s responsibility for site arrangements and facilities Watching and lighting Storage facilities; Unloading, hoisting and getting in materials; Scaffolding; Water and temporary electrical supplies; Safety, health and welfare provisions; Licenses and permits; and Any additional facilities. d) Conditions of subcontract: Form of subcontract agreement; Period of interim payments and payment terms, including; whether pay when paid will apply; Discount applicable to the payments; Fluctuations or fixed price tender; and Other special conditions. e) Particulars of the main contract conditions:

58 42 An extract from the appendix to the form of contract will assist in providing a summary of the contract particulars. This should contain the following information: Form of contract; Fluctuations provisions; Method of measurement; Main contract period and completion date; Defects liability period; Liquidated and ascertained damages; Period of interim certificates; Basis of day works; Insurance provisions; and Deletions or amendments to the standard contract clauses. f) Type of quotation required from the subcontractor: Lump sum quotation; and Schedule of rates. g) Other information: Date for the return of the tender; Person in the contractor s organization to contact; Period for which the tender is to remain open for acceptance; Extent of the phasing of the works and number of anticipated visits to undertake the works; and Reference to any relevant attendances likely to affect the subcontractor.

59 Scheduling the Work The contractor should specify an approximate starting date and completion date for the project. For example, the contract should read "Begin approximately April 20 and end approximately April 30," not "Complete the job in 10 days." This eliminates the possibility that the contractor will take 10 days to finish the job but spread them out over the span of a year. However, external factors such as the weather or the availability of supplies might cause delays Keep a Job File The contractor should keep a file of all papers relating to the project for the future reference. It should include: a) The contract and any change orders; b) Plans and specifications; c) Bills and invoices; d) Canceled checks; e) Lien releases from subcontractors and material suppliers; f) Letters, notes, and correspondence with your contractor; and g) Pictures of the job in progress.

60 44 It is also a good idea to keep a record of each subcontractor who works on the project, the work performed, and length of time on the job. When material suppliers make a delivery, write down the name of the company, the date, and a general description of what they delivered. When received preliminary notices from subcontractors or suppliers, make sure receive with lien releases. Check them against the list. That way we will have a record of who has and has not been paid Provide Site Training For Workers The needs for training There seems to be a prevailing belief in the United States that if you are good at doing something, then you can manage other people doing that the same work,(lewis,2005). All employees of the organization should be provided with adequate training in their respective field so as to enable them to execute their jobs responsibilities efficiency. Training should be provided to all of the head office staff and permanent staff assigned to the sites. Contract staff are generally not covered in any training programme except on the request of the management. Each manager is responsible for identifying the training needs and provides training for staff under his supervision. This is to ensure that they have the basic competence skills and experience necessary to perform their tasks, (Chew and Chai,1996).

61 Improve the method of supervision of labors work. Supervision is the economic development of the project will rely almost on the efficiency of the organization on site and the quality of the work will be determined by the effectiveness of the site supervision (Broughton, 2003). The three main areas where supervisory performance is most important: a) Concerned with actual processes and tasks to be supervised; b) Concern with the variety of control and co ordinations required by the numerous interested organizations over these processes; and c) Concerned with people who are involved in these processes. Effective supervision is, therefore, related to a combination of technical, operational and human aspects of construction work. The effective, or successful, supervision depend upon the ability and motivation of the individual supervisor and the opportunities given to him by higher management. To be successful supervisor, he must learn how to do a number of things: a) He must learn how to guide and direct the efforts of the people he is responsible for; b) He must learn how to work in the organization of which he and his people are part; c) He must learn how to train or teach people to do their jobs; d) He must learn how to speak and write clearly and effectively; e) He must learn how to analyze workloads; f) He must learn how to make plan of action; and g) He must learn how to schedule work.

62 Summary From the literature research above, therefore, the strategy to improve quality performance can be summarize as know how to improve the method of supervision of labors work; how to improve the method of planning and scheduling techniques; provides site training for workers; improve the system of checking drawings and specification; practice the effective site communication, production meeting and minutes; practice good quality assurance from top management; focus on client needs, meet the client requirements and exceed the client expectation; maintain mutually beneficial relationship with supplier; improve the quality control and method of checking, and good discussion and negotiation skills with client.

63 47 CHAPTER 4 RESEARCH METHODOLOGY 4.1 Introduction The research methodology is essential in guiding the researcher to achieve the aim and the objectives of the study. This chapter will describe the methodology used in carrying out this study. The study was carried out first through the literature search and followed by interviews and questionnaire. Subsequently, the questionnaires and their results and inferences are presented. It follows through discussions and suggestions and eventually conclusions being drawn to conclude the study. The targeted participants comprised experienced senior or principal of the companies such as managing directors, managers and project managers. This group of people chosen was likely to possess substantial experience in data collection methods and to make judgments and opinions on the importance of essential skills or to pass the questionnaire to the right person if they were not participating, (Lee and Tan, 2003).

64 Research Methodology To encourage participation, each company was contacted by telephone prior to sending out the mail questionnaire. From this initial contact, the respondent s name, functions and responsibilities within their respective departments were determined. A total of 100 mail questionnaire were utilized and sent to carefully identified and selected project-intensive engineering organizations, in which the selection is based on the number, size, and types of projects. The data collection was based on a detailed, 6-page, pre-tested research questionnaire. The questionnaire was pre-tested three weeks prior to the postal survey by submitting it to a few selected project managers in engineering project-based organizations. These people were asked to comment on each question in term of ease of understanding and interpretation, content, appropriateness, relevance, and comprehensiveness. The survey questionnaire were subsequently revised from the information and feedback provided by these participants. The questionnaire was designed and communicated in a user-friendly multiple-choice format, with only a few open-ended questions, to reduce answering effort, and to aid the recipients in making decisions. In the postal surveys, the questionnaire was accompanied by a personalized cover letter (assuring anonymity and confidentially) and gave the participant instructions and the purpose of the intended research. A self- addressed stamped envelope was include for the convenience of the participants to return the completed questionnaire. To boost response rates and to ensure a timely completion of the questionnaire, two weeks after the initial mailing, non-respondents with accounts were sent online questionnaires as a friendly reminder. This improved the response rate to approximately 40 percent. A week after that, a telephone follow-up call was carried out to request for their cooperation. Up to three attempts were made to reach individuals who had not yet returned the complete questionnaire by the set deadline.

65 49 Both telephone and personal interviews were conducted with participants from various contractors firm, with the aid of structured questionnaires. Interview questions centered around the business profile and environment, project activities, issues of recruitment problems, current and future skills requirements, employer expectations and perceptions on skills training, hiring practices, and issues that important to the employer but not covered in the questionnaire, (Lee and Tan, 2003). For this study the brief methodology is divided into four stages, such as: a) Literature Review; b) Data Collection; c) Analysis; and d) Findings. In the part of the preliminary study, the following three items were identified and been studied; a) Statement of problems; b) Objectives; and c) Scope of Study. 4.3 Literature Review There are two important sections under the literature review where the first section explain the factors that influence the contractors performance and the critical factors that influence the contractors performance. The second part of the section describes the method to improve the contractors performance. The purpose of the literature review was to help the author on the general overview of the study. The literature study was done through reading and searching on the subjects from

66 50 books, journals, magazines, and PKK and CIDB Registration Procedures and Regulations. The literature review hence, provides guidance to questionnaire preparation, which is discussed in the following section. 4.4 Data Collections In this stage, data collection to be study in this research were categorized into two kind of data: a) Primary data b) Secondary Data The primary data were collected in two method, the first method by the questionnaire where question been developed and distribute to the relevant contractor and the second method by face to face interviews. Questionnaire is designed base on literature and consultation with the relevant professional. Questionnaires then distributes to significant respondent that identified earlier. ( Please refer to Appendix A Questionnaire form ) Questionnaire is designed in two main sections. Section 1 is about general information on the background of respondent. Section 2 is about the opinion regarding factors that influencing the contractors performance, the critical factors that influence the contractors performance and the method to improve the performance.

67 51 The distributed questionnaires were collected and analyzed using statistical method. Discussion was done base on the derived results and related statistic and suggestion by the participants were include. Out of the 100 significant respondent identified, a total of 33 responses were obtained Questionnaire Design The question asked in the questionnaire could be in the form of multiple choice or open ended questions. Multiple-choice questions require the anticipation of the whole range of likely answers, which would be given, and formulating the options as such. The options available should be established had been on the desk research and preliminary casual interview with some industry players to test the validity of options. Having considered the factors that influence the contractors performance and the strategies to improve the performance, a semi-structured approach with mostly multiple-choice questions was selected. The sample of questionnaire used for the survey in this study is shown in Appendix A. The multiple-choice questions are based on Likert s scale of five ordinal measures of agreement towards each statement (from 1 to 5) as shown in Figure 4.1 below.

68 52 Ordinal scale 1 to 5 in ascending order Increasing degree of agreement Each scale represents the following rating: 1 = Strongly Disagree 2 = Disagree 3 = Not Sure 4 = Agree 5 = Strongly Agree Figure 4.1: Five Ordinal Measures of Contributing Factors of Likert Scale 4.5 Analysis of Data The next logical step, after collecting the information is to analyse the information and available data. The factors that influencing the contractors performance and the strategies undertaken in order to improve the contractors performance are identified. The factors that influence the contractors performance are list ten main factors as stated in Table 4.1.

69 53 Table 4.1: The Factor That Influence The Contractor s Performance No. The Factor Influence Contractors Performance 1 Experience & Skilled Workers 2 Understand the method of work 3 Good Planning & Scheduling 4 Understand Specification & Drawings 5 Good communication between supervisors and workers 6 Understand the client needs and quality expected 7 Use the quality materials 8 Financial Competence and good cash flow 9 Competent site supervisor full time at site 10 Own machinery and equipment The procedure has been used in analyzing the result of questionnaire survey is aimed that at establishing the relative importance for the various factors that influencing the contractors performance and to determine the most common factors by ranking them according to the data given by the respondents. Beside that, the questionnaire survey is also aimed to search the respondents feedback regarding the strategies undertaken by the construction organization in order to succeed and any better ways to improve the performance of the construction organizations. It is intended that the results obtained would generate some proposals on how could the construction organization succeed in today s construction industry.

70 54 Table 4.2: The Strategies To Improve The Contractor s Performance No. The Strategies to improve Contractors Performance 1 Focus on client needs, meet the client requirements and exceed the client expectation 2 Improve the method of supervision of labors work 3 Improve Planning & Scheduling techniques 4 Maintain mutually beneficial relationship with supplier 5 Good discussion and negotiation skills with client 6 Effective site communication, production meeting and minutes 7 Good quality assurance from top management 8 Improve the quality control and method of checking 9 Improve the system of checking drawings and specification 10 Site training Questionnaire Measure The sample of questionnaire used it the interview for this study as attached in Appendix A. This questionnaire is mainly based on a Likert s Scale of five ordinal measures from one (1) to five (5) according to the level of agreement as stated in Figure 4.1 above. The data generated from the questionnaire was analyzed by using the frequency analysis. The measurement tools in the survey provide quantitative indication of qualitative judgments.

71 55 The rating scale for the questionnaire are; 1=strongly disagree, 2=disagree, 3=not sure, 4=agree and 5=strongly agree. The average index formula: Average Index = μ X n (1) N Where, μ is weighting given to each factor by respondents; n is the frequency of the respondent; N is the total number of respondent. With the rating scale as below, (Abd. Majid and McCaffer, 1997); - 1 = Strongly Disagree( 1.00 Average Index 1.50 ) - 2 = Disagree ( 1.50 Average Index 2.50 ) - 3 = Not Sure ( 2.50 Average Index 3.50 ) - 4 = Agree ( 3.50 Average Index 4.50 ) - 5 = Strongly Agree ( 4.50 Average Index 5.00 )

72 Summary For the conclusion, the method of data collection is divided in two ways, by the questionnaire and face to face interviews. Each company was contacted by telephone prior to sending out the mail questionnaire to encourage participation. The questionnaire was pre-tested three weeks prior to the postal survey by submitting it to a few selected project managers. These people were asked to comment on each question. A self- addressed stamped envelope was include for the convenience of the participants to return the completed questionnaire. A week after that, a telephone follow-up call was carried out to request for their cooperation. Personal interviews were conducted with the aid of structured questionnaires. Interview questions centered around the business profile and environment, project activities, issues of recruitment problems, current and future skills requirements and clients expectations. The questionnaires are used to collect data. The average index formula been used to analyzed the data. Finally, from the findings of questionnaire survey, the researcher will be able to identify the success factors and the strategies as well as the way to improve the performance of construction organization.

73 57 CHAPTER 5 DATA ANALYSIS AND RESULTS 5.1 Introduction After all data have been collected through the questionnaire survey, the data is then analyzed and discussed. This chapter presents the analysis and the results of the research derived from the data gathered from the questionnaires. In accordance to the research methodology as described in the previous chapter, the data and the results are analyzed and presented in alignment with the objectives in Chapter 1. This chapter also gives the brief information about Felda Plantations Sdn. Bhd. as the client s including the client s background, corporate mission and the company strength. The respondent background also been highlighted and analyzed in terms of registrations background, staff strength and financial capabilities.

74 Clients Background Felda Plantations Sdn Bhd (FPSB) was formed on 13th January It is a management services company with expertise in the plantation industry. The main activities are to manage Felda commercial estates and replanting Felda estates. The management office and head quarters is located at 8 th Floor, Balai Felda, Jalan Gurney 1, Kuala Lumpur. (Please refer to Appendix A for the office location and FPSB estates) Corporate Mission The Felda Plantations missions are : a) Managing Felda's estates in accordance with good agricultural practices and in compliance with environmental norms to ensure long-term sustainability and competitiveness; and b) Ensuring Felda estates yields and cost are comparable with other private estate in the industry Staff Strength Felda Plantations Sdn. Bhd. have a total of 2333 staffs, whereas 223 staffs are from agency such as head quarters and regional office, meanwhile the estates have 2110 staffs, as tabulated in Table 5.1 below:

75 59 Table 5.1: Felda Plantations Sdn. Bhd. Staff Strength Location Executive Non Executive Total Agency Estates Total Staff Figure 5.1: Felda Plantations Sdn. Bhd. Staff Strength

76 Financial Highlights The authorized capital for the company is about RM 45 million and the paid-up capital reach up to RM 30 million. The major shareholders for the company is from Felda Holdings Berhad holds the 51% of shares, meanwhile Federal Land Development Authority (FELDA) holds 49% of shares. Table 5.2 and Table 5.3 shows the company Authorized and Paid-Up Capital and Major Shareholders. Table 5.2: Company Authorized and Paid-Up Capital Capital Value (RM ) Million Authorized 45 Paid-Up 30 Shareholder Fund & Reserve 165 Table 5.3: Felda Plantations Sdn. Bhd. Shareholders Company Share Felda Holdings Berhad 51% Felda 49%

77 The Respondents Background From the list of the contractors registration with the Felda Plantations Sdn. Bhd. from the year of 2004 to 30 th of June 2005, can be summarized as shows in table 5.4. The registered list shows that 95 percents of the company that were registered are bumiputera status which hold the majority company s board of director or share holder more than 51%. There are only 5% of the company are nonbumiputera as tabulated in Figure 5.2 below. Table 5.4: Respondent Registration With Felda Plantations Sdn. Bhd. Description Frequency Percent (%) Cumulative % Bumiputera Non-Bumiputera TOTAL Non Bumi 5% Bumiputera Non Bumi Bumiputera 95% Figure 5.2: Registration of Contractors Under Felda Plantations Sdn. Bhd.

78 62 a. Registration Under Relevant Bodies For the tender purposes, the contractors which registered their company for the tender job under Felda Plantations Sdn. Bhd. compulsory must have their registration with the relevant board or authority such as Pusat Khidmat Kontraktor (PKK), Construction Industry Development Board (CIDB), Company Commission of Malaysia (CCM), Ministry of Finance (MOF), etc. The tabulated contractor s registrations under the relevant bodies are as shown in Table 5.5 and Figure 5.3 below: Table 5.5: Respondent Registration Under Relevant Bodies Description Frequency Percent (%) Cumulative % PKK CIDB (Only) CCM MoF TOTAL CIDB 3% CCM 9% MOF 1% PKK CIDB CCM MOF PKK 87% Figure 5.3: Registration of Contractors Under Relevant Bodies

79 63 b. Registration With Pusat Khidmat Kontraktor (PKK) The company that registered with Pusat Khidmat Kontraktor were range from class A to class F are as shown in Table 5.6 and Figure 5.4 below: Table 5.6: Respondent Registration With PKK Description Frequency Percent (%) Cumulative % Class A Class B Class C Class D Class E Class F TOTAL Class F 38% Class E 5% Class A 8% Class B 15% Class D 22% Class C 12% Class A Class B Class C Class D Class E Class F Figure 5.4: Registration of Contractors Under PKK

80 64 The figure shows that the highest registered were Class F contractors that consists of 38%, follows by Class D of 22% and Class B of 15 %. follows; The tendering capacity which stated by Pusat Khidmat Kontraktor are as 1) Class A = More than RM 10,000,000; 2) Class B = From RM 5,000,001 to RM 10,000,000; 3) Class C = From RM 2,000,001 to RM 5,000,000; 4) Class D = From RM 500,001 to RM 2,000,000; 5) Class E = From RM 200,001 to RM 500,000; and 6) Class F = Up to RM 200,000. c. Registration With Construction Industry Development Board (CIDB) Only The companies which registered with Construction Industry Development Board (CIDB) only, in this case, this companies did not have the registration with Pusat Khidmat Kontraktor (PKK), are as follows: Table 5.7: Respondent Registration With CIDB Only Description Frequency Percent (%) Cumulative % Grade G Grade G Grade G Grade G TOTAL 6 100

81 65 CIDB G2 CIDB G7 33% 33% CIDB G7 CIDB G3 17% CIDB G4 17% CIDB G4 CIDB G3 CIDB G2 Figure 5.5: Registration of Contractors Under CIDB Only The figure above shows that the highest registered grade with CIDB were G2 and G7 that consists of 33% each, follows by Grade G3 and G4 of 17 % each. The tendering capacities for each grades of CIDB registration are as follows: 1) Grade G1 = Not exceeding RM 100,000; 2) Grade G2 = Not exceeding RM 500,000; 3) Grade G3 = Not exceeding RM 1,000,000; 4) Grade G4 = Not exceeding RM 3,000,000; 5) Grade G5 = Not exceeding RM 5,000,000; 6) Grade G6 = Not exceeding RM 10,000,000; and 7) Grade G7 = No Limit.

82 Result and Analysis Out of the 100 questionnaires that were mailed, 49 (49%) questionnaires were return, from 49 return questionnaires only 33 (67%) were useable, 16 were rejected (32%) due to the incorrect and not properly answered. The nonrespondents quoted the following for their non-participation; lack of time (too busy), lack of interest, and matters of confidentiality. Table 5.8 and Table 5.6 below show the tabulated and the percentage of the returned questionnaire. Table 5.8: Returned Questionnaire Description Frequency Percent (%) Cumulative % Useable Reject TOTAL Reject 33% Useable 67% Useable Reject Figure 5.6: Returned Questionnaire

83 67 From the analysis of the contractors as the participant from the returned of 33 questionnaire, the factors below has been found: a. The Full Time Staff in The Contractors Firm Form the analysis, the most high percentage of staff work with contractors were from 1 t0 5 years ( 54%), follows by 11 to 20 years (36%), over than 20 years (6%) and 6 to 10 years (4%). The tabulated percentage as shown in Table 5.9 and Figure 5.7 below: Table 5.9: The Full Time Staff in The Construction Firm Description Frequency Percent (%) Cumulative % 1 5 Years Years Years >20 Years TOTAL Years 36% >20 Years 6% 6-10 Years 4% 1-5 Years 54% 1-5 Years 6-10 Years Years >20 Years Figure 5.7: Full Time Staff Work Under Contractors

84 68 b. The contractor s experience involved in the construction industry Form the analysis, the percentage of contractors experience were from 1 to 5 years ( 42%), follows by 6 to 10 years (36%), 11 to 20 years (225) and over than 20 years (6%) The tabulated percentage as shown in Table 5.10 and Figure 5.8 below: Table 5.10: The contractor s experience involved in the construction industry Description Frequency Percent (%) Cumulative % 1 5 Years Years Years >20 Years TOTAL Years 22% 6-10 Years 36% >20 Years 0% 1-5 Years 42% 1-5 Years 6-10 Years Years >20 Years Figure 5.8: The Contractors Experience in Construction Industry

85 69 c. The Respondent Company Manager s or Owner s Qualifications Form the analysis, the percentage of Manager s Qualifications were 48% Obtain Certificates such as Sijil Asas Kontraktor Binaan, 30% Other qualifications not related to the construction fields, 12% have diplomas and 10% have Degrees in related construction fields. The tabulated percentage as shown in Table 5.11 and Figure 5.9 below: Table 5.11: The Company Manager s or Owner s Qualifications Description Frequency Percent (%) Cumulative % Degree Diploma Certificate Others TOTAL Others 30% Degree 10% Diploma 12% Degree Diploma Certificate Others Certificate 48% Figure 5.9: The Company Manager s Qualification

86 70 d. The Respondent s Company Paid Up Capital Form the analysis, the most of the companies Paid-Up capital were range from RM100,000 to RM 200,000 ( 36%), follows by RM200,000 to RM 500,000 and below than RM 100,000 (30%), and more than RM 500,000 (4%). The tabulated percentage as shown in Table 5.12 and Figure 5.10 below: Table 5.12: The Company Paid Up Capital Description Frequency Percent (%) Cumulative % Below RM 100K RM100K-RM200K RM200K-RM500K Above RM500K TOTAL RM200,000- RM500,00 30% >RM500,000 4% RM100,000- RM200,000 36% <RM100,00 30% <RM100,00 RM100,000-RM200,000 RM200,000-RM500,00 >RM500,000 Figure 5.10: The Company Paid-Up Capital

87 The Result of The Questionnaire Survey a. The result of the factors that influence the contractor s performance This section investigates the factors that influence the contractor s performance. Table 5.13 shows the results of mailed survey of the factors that influence the contractor s performance: Table 5.13 The Factor that Influence The Contractor s Performance No Factor That Influence Frequency Analysis Average The Contractor s Index Rank Performance No. of Respondents 1 Good Planning & Scheduling Experience & Skilled Workers Understand the method of work 4 Good communication between supervisors and workers 5 Use the quality materials Understand Specification & Drawings 7 Competent site supervisor full time at site 8 Understand the client needs and quality expected 9 Financial Competence and good cash flow 10 Own machinery and equipment

88 72 b. The result of the critical factors that influence the contractor s performance A table 5.14 shows the result of the critical factors that influence the contractor s performance. This result comes from the factors that influence the contractors performance above, then the factors been ranked to get the result which number 1 as the most critical to number 10 the less critical and the result as shown below: Table 5.14 The Critical Factor That Influence The Contractor s Performance No. The Critical Factor Influence Contractor s Rank Performance 1 Experience & Skilled Workers 1 2 Understand the method of work 2 3 Good Planning & Scheduling 3 4 Understand Specification & Drawings 4 5 Good communication between supervisors and 5 workers 6 Understand the client needs and quality expected 6 7 Use the quality materials 7 8 Financial Competence and good cash flow 8 9 Competent site supervisor full time at site 9 10 Own machinery and equipment 10

89 73 c. The result of the strategies to improve the contractor s performance The last section of the questionnaire investigates the extent of the strategies that to improve the contractor s performance. The results are as tabulated in Table 5.15 below. Table 5.15: The Strategies to Improve The Contractor s Performance The Strategies To Improve Frequency Analysis Average No. The Contractor s Index Rank Performance No. of Respondents 1 Site training Improve the system of checking drawings and specification 3 Improve Planning & Scheduling techniques 4 Improve the method of supervision of labors work 5 Good quality assurance from top management 6 Effective site communication, production meeting and minutes 7 Improve the quality control and method of checking 8 Good discussion and negotiation skills with client 9 Maintain mutually beneficial relationship with supplier 10 Focus on client needs, meet the client requirements and exceed the client expectation

90 Findings and Discussions This section discusses the findings of this study. The results of the study are analyzed and discussed in the following sequence to answer the objectives mentioned in Chapter 1. The aforementioned analysis sequence is organized and presented the data in some meaningful and logical order. After the data have been organized and presented into descriptive manner, it is then analyzed and interpreted them in order to draw inferences about the data obtained. The discussions are divided into four parts. The first part discusses the respondent background. The second part discusses the factors that influence the contractor s performance. Then, follows by the establishment of critical factors that influence the contractor s performance. Finally, discuss on the strategies undertaken by the construction organization to improve their performance. Discussion on the findings will be based on Average Index as the indicator corresponding to each statement. The value of Average Index ranging from 1.00 to 5.00, with 3.84 being the lowest degree of rating for the responses and 4.70 gives the highest degree of responses. a. Respondents Background A group of respondents (42.5%) have experience in the construction industry between 1 to 5 years, (36%) have experience between 6 to 10 years and (21.5%) have an experience between 11 to 20 years.

91 75 b. First Objective: To identify the factors that influence the contractor s performance This section discussed the findings based on the results obtained from the questionnaire survey vis-à-vis the factors that influence the contractor s performance. Table 5.16 shows the ranking of the factors that influencing the contractor s performance. Table 5.16 The Factor that Influence The Contractor s Performance No. The Factor Influence Contractor s Performance Rank/AI 1 Experience & Skilled Workers 1 (4.67) 2 Understand the method of work 2 (4.63) 3 Good Planning & Scheduling 3 (4.60) 4 Understand Specification & Drawings 4 (4.57) 5 Good communication between supervisors and workers 5 (4.55) 6 Understand the client needs and quality expected 6 (4.45) 7 Use the quality materials 7 (4.42) 8 Financial Competence and good cash flow 8 (4.33) 9 Competent site supervisor full time at site 9 (4.24) 10 Own machinery and equipment 10(3.84) The Tables 5.16 indicate most of the factors listed above achieving the average index of more than 3.5 to not more than 5.0 rating scale region that directly indicate 10 factors that influence the contractor s performance. Relatively, the majority of the respondent agreed it is crucial to be taken into consideration the 10 factors. This indicate three major factors that most important while running a project is to use the experience and skilled workers, to understand the method of work and to practice a good planning and scheduling of the work.

92 76 c. Second Objective: To identify the critical factors that influence the contractor s performance From the ranking above, the critical factors that influence the contractor s performance been identified. The used of the experience and skilled workers were the most critical parts that must be considered to ensure the good quality of work. Because, non experienced and non skilled workers will directly effect the quality of performance and can cause the failure of the project schedule when the bad quality of work have to reconstruct to meet the client s expected quality. The contractor s skilled workforce may be a factor in the client s decision to select the contractor to perform the work. At the same time, the contractor s skilled workforce creates expectations on the part of the client. For example, because of the skilled workforce, the client may have the expectation that there will be no rework on the project or service calls to repair something after the customer has begun using the facility. The second highest rank of the critical factors is the contractor must understand the method of work. Do it right the first time to prevent the reconstruct of the work, this motto is used in most good construction companies. The companies loose money when they start having to tear out work because they failed to do it right the first time. Replacing work changes the schedule, doubles or triples the cost of the work, and destroys pride and morale. Highly productive crews know how to do it the first time. That s why, before start work, the contractors must submit the method statement to make sure they understand the method of work. Good Planning & Scheduling of the work is critical because this factors will effect the performance when the schedule or programmed of work is out of order. The improper planning of the resources, materials, time and financial can cause the

93 77 project problems, delay and abandoned. Failing to plan is planning to fail and once you plan your work, you must work your plan this is another motto that have been used in most good construction companies. Project planning is the strategy to accomplish the work. It involves selecting and assigning competent and compatible, qualified and experienced project staff as well as identifying the task and activities necessary to accomplish the work. d. Third Objective: The strategy to improve the contractor s performance This section discussed the findings based on the result obtained from the questionnaire vis-à-vis the strategies that is undertaken by the construction organization to improve the performance. Table 5.17 shows the ranking of strategies that is undertaken by the companies to improve their performance. Table 5.17: The Strategies to Improve The Contractor s Performance No. The Strategies to Improve Contractors Performance Rank/A.I 1 Focus on client needs, meet the client requirements and exceed 1 (4.70) the client expectation 2 Improve the method of supervision of labors work 2 (4.67) 3 Improve Planning & Scheduling techniques 3 (4.63) 4 Maintain mutually beneficial relationship with supplier 4 (4.67) 5 Good discussion and negotiation skills with client 5 (4.55) 6 Effective site communication, production meeting and minutes 6 (4.51) 7 Good quality assurance from top management 6 (4.51) 8 Improve the quality control and method of checking 8 (4.48) 9 Improve the system of checking drawings and specification 8 ( 4.48) 10 Site training 10 (4.13)

94 78 As the Table 5.17 presented that the focus on client needs, meet the client requirements and exceeds the client expectation is the most important strategy to highlight to improve the contractor s performance with average index of The method of supervision of labors work is the second rank of 4.67 average index, while improve the planning and scheduling techniques is the third rank with 4.63 average index. This is important because when the task were proper planning the contractor can do the job without pressure that will effect their focus. From the result above, the three most important strategy to improve the performance of the contractors were identified, there are; Focus on client needs, meet the client requirements and exceed the client expectation; the contractors must understand the concept from the beginning what the client s expectation and have to maintain that expectation until the handing over of the contract. Improve the method of supervision of labors work, the proper method of supervision must be developed and the checklist of the method of work must be clear to maintain the quality of the workmanship. Improve Planning & Scheduling techniques; the contractor must be familiar with the planning and scheduling method to get the proper control of the work. Understand the critical path and able to do the corrective action when needed.

95 Suggestions for better performance Here are some selected comments and suggestions expressed by respondent that might help the contractors to overcome the performance of construction dilemma: a) The contractors sometimes fail to identify the workers problem in construction activity. This can be solve by the companies to maintain their good communication with the workers, listen to their problems and try to solve in good situation. b) The contractors target more on money rather than the performance. The contractors must have an attitude to produce the good performance rather than money, because the good performance they shows is not the additional cost that the contractors have to pay. c) In case of following the specification, the contractors should control the cost of the project and never try to get more payment by additional work. The contractor who attempts to increase the value of the contract and his profit through continuous claim for extras will suffer a loss credibility. d) The client also should give the reasonable tender price to the contractor to maintain the good quality of work. e) To solve the problems it is useful for the contractors and the client to have a good communications and negotiations skills.

96 Summary Quantitative judgments were employed in data analysis. Statistic was used to analyzed the background of the respondents and Likert Scaling used to analyzed the factors that influence the contractor s performance, the critical factors that influence the contractor s performance and the strategy to improve the contractor s performance in order for the contractor s and client s to be more successful in their project. The final result of the analysis was listed. According to the result analysis, it shows that to select the experienced and skilled workers is the most significant and critical factors that influence the contractors performance. Lastly, the most frequent strategy must be undertaken by the contractor s companies is to focus on client needs, meet the client requirements and exceed the client expectation to get the better work performance.

97 81 CHAPTER 6 CONCLUSIONS AND RECOMMENDATION 6.1 Introduction This Chapter concludes the study by listing down the results of the analysis. Some recommendations for the better performance of construction organization were included. Based on the literature reviews, questionnaires distribution, feedbacks and result analysis, the three main objectives of this project report have been achieve.

98 Conclusions As a conclusion, this study has identified and met the entire three objectives that had stated earlier: Objective 1: To identify the factors that influence the contractor s workmanship. In overall the respondents agree that the first three major factors that influence the contractors performance were to use the experience and skilled workers; to understand the method of work; and understand the good planning and schedule the task of work. Objectives 2: To establish the critical factors that influence the contractor s workmanship. The most critical factors were rank the factors that influence the contractor s performance from 1 to 10 as follows: 1. Use the experience and skilled workers; 2. Understand the method of work; 3. Good planning and scheduling technique; 4. Understand drawings and specifications; 5. Good communication between supervisors and workers; 6. Understand the client needs and quality expectations; 7. Use the quality materials; 8. Financial competence and good management of cash flow; 9. Competence site supervisor full time on site; and 10. Owning machinery and equipment.

99 83 Objectives 3: To identify strategy to improve the contractor s performance. The respondent agree to select the three major factors that can influence on the improvement on the contractor s performance were to focus on client needs, meet the client requirements and exceed the client expectation; the planning and scheduling techniques; and the method of supervision of labors work. 6.2 Recommendation In order to get the good performance of the contractors, it is recommended by the author that the three stage which listed below can be follow: a. First Stage: Pre-Contract Evaluation and Decision To get the good performance, the client must know how to select a good contractors, (for the contractors, he or she must know how to select a good subcontractors), from the literature review, the criteria of selected the good contractor was highlighted by Chew (2003), he was listed seven most effective way of selecting a contractors as follows: 1. Tender Price, the price must be reasonable to maintain the quality of work. 2. Time to completion, on how realistic the submitted work programmed can achieve the milestones in the project. 3. Quality of product(s) to meet the specifications and by the technical and performance. 4. Technical and organizational competence, which is shown in their proposed assignment of adequate and right people and the use of

100 84 5. experience sub-contractors to work on the project, how the organization of the project team reflects the understanding of the key cause and effect relationship in the project and how the managements approach could enhance the construction process of the project. 6. Financial competence, which is indicated by financial robustness and adequacy of funds to maintain financial health for seeing the project through or indications of the ability to deal with any unforeseen financial impacts on the projects. 7. Past performance, of projects of similar size, complexity and nature that have been executed successfully. 8. Relationship, in respect of the contractor s ability and willingness to sustain a quality business relationship based on pre-existing knowledge and experience. For this matter, the client s can use the suggested form of the Contractor Selection Checklist for Pre-qualified Tender which has been attach in Appendix C as a criteria basis on the contractor selection. b. Second Stage: During Construction When the contract is in the construction stage, it is recommended that the result of the analysis for the strategies to improve contractor s performance been developed and studied further to practice and maintain a good performance. There are as follows: 1. The contractors must know, understand and focus on client s needs, meet the client requirements and exceed the client expectation.

101 85 2. Improve the method of supervision of labors work by developed a suitable checklist on how to supervise and communicate with the labors. 3. Improve the knowledge in planning and scheduling technique, know how to determine what is going to be done, how, where, by whom, and when. 4. Maintain mutually beneficial relationship with supplier to make sure the source of materials can be achieve on target and deliver on time to the site to prevent delay, wrong materials and out of schedule. 5. Built up a good discussion and negotiations skills with the client to prevent misunderstanding of client s needs and expectations and to solve the problems in good situation. 6. Built up an effective site communications to prevent misunderstanding between managers, supervisors and workers, In many cases, the communication breakdown happens because the managers communicate in one direction only. They do not take time to be sure that the person with whom they are communicating actually understood the massage. Every communications, discussion and meetings must be written up to prevent disputes. 7. To make sure the top management give the full support for quality assurance, because the quality assurance is refers to the management systems employed by constructions companies to produce highquality work consistently. The quality is not been achieve without full support from the top management of the companies. The company should think about the quality of product rather than money. 8. Improve the quality control and method of checking by developed a checking checklist refer to the specification needed. 9. Improve the system of checking drawings and specification by developed a suitable checklist and understand the drawings and specifications.

102 Give site training for the workers in their respective field so as to enable them to execute their jobs responsibilities efficiently. c. Third Stage: Post-Contract When the contract is handing over, the client can evaluate the performance that have been shown by the contractor during the construction period. It is recommend that to use the Contractor Performance Evaluation Form which attached in Appendix D to evaluate and help the client s to made the decision whether this contractor are still perform for the next selection of the project. 6.4 Suggestion For Further Studies There are some area suggested by the author for further study in the area of contractor s performance as listed below: 1) The contractor s performance focused on cost quality; 2) The contractor s performance focused on time quality; 3) The contractor s performance focused on environmental awareness; 4) The contractor s performance focused on safety and health; and 5) The contractor s performance focused on client s satisfaction.

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105 89 R. Edward Minchin Jr and Gary R. Smith, M.ASCE(2005), Quality-Based Contractor Rating Model for Qualification and Bidding Purposes, Journal of Construction Engineering and Management, ASCE Rue, L.W. and Byars,L.L.,(1997), Management: Skills & Applications, McGraw- Hill Thum Peng Chew(2003), A Fuzzy Multiple Attribute Decision-Making Approach to Tender Evaluation, Journal Institution of Engineers Malaysia, Vol 64 No William F. Maloney, M.ASCE(1997), Strategic Planning for Human Resource Management in Construction, Journal of Construction Engineering and Management, ASCE Wiliam F. Maloney, M.ASCE(2002), Construction Product/Service and Customer Satisfaction, Journal of Construction Engineering and Management, ASCE Xianhai Meng, M.ASCE(2002), Guarantees for Contractor s Performance and Owner s Payment in China, Journal of Construction Engineering and Management, ASCE Yeoh Sek Chew and Lee Ng Chai (1996), ISO 9002 In The Malaysian Construction Industry Guide And Implementation, McGraw-Hill Book Co.

106 APPENDIX

107 90 APPENDIX A Felda Plantations Office Location Felda Plantations Sdn Bhd ( U) 8th Floor, Balai Felda Jalan Gurney Satu Kuala Lumpur Tel: Fax: Branches/Projects