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COBRA 2016

Toronto, Canada

20 - 22 September 2016

Supported by:
rics.org/cobra
RICS COBRA 2016

The Construction, Building and Real Estate Research Conference


of the Royal Institution of Chartered Surveyors

Held in Toronto, Canada in association with George Brown College

20 - 22 September 2016

© RICS 2016

ISBN: 978-1-78321-160-9

ISSN: 2398-8614

Royal Institution of Chartered Surveyors

Parliament Square

London

SW1P 3AD

United Kingdom

www.rics.org/cobra

The papers in this proceeding are intended for knowledge sharing, stimulate debate, and
research findings only. This publication does not necessarily represent the views of RICS
or George Brown College.
A FRAMEWORK TO ENHANCE THE PRODUCTIVITY IN
CONSTRUCTION PROJECTS INVOLVING INTERNATIONAL
PROFESSIONALS AND CONTRACTORS: CASE OF SRI LANKA

Dananjaya Gunasekara1,Thanuja Ramachandra2, and James Olabode Rotimi3


1,2
Department of Building Economics, University of Moratuwa, Moratuwa, Sri Lanka.
3
School of Engineering, Auckland University of Technology, New Zealand.

ABSTRACT
The construction industry in Sri Lanka is generally challenged by sharp
practices amongst its variety of indigenous and foreign professionals and
contractors, often leading to low productivity. Productivity is an index for
evaluating efficiency and performance of construction projects, and the current
research investigates the factors influencing productivity. The aim is to
recommend strategies that could mitigate the negative effects of low
productivity in Sri Lanka. The study provides a conceptual framework to
enhance productivity, where international professionals and contractors are
involved in construction projects.

A questionnaire survey was administered to a total of 40 local and international


construction professionals who currently work in Sri Lanka as engineers,
quantity surveyors, architects, project managers and construction administrators.
The objective is to determine the significant factors influencing productivity and
strategies for improvement. 33 out of 40 positive responses were analysed for
the study. The findings indicate 16 most significant factors including: level of
experience, level of knowledge in new advanced technology and construction
techniques, low levels of on-site safety and government policies, different
lifestyles and cultural behaviors. The results suggest that implementing strategic
approaches that could enhance on-site safety policies and procedures, use of
advanced technology, improve and encourage team work would positively
impact on productivity of construction projects in Sri Lanka.

Key Words: Construction industry, Productivity; International professionals;


International contractors; Sri Lanka.

INTRODUCTION
The construction industry is one of the largest employers of local resources and
contributes considerably to the Gross Domestic Production (GDP) of most countries
(Swider, 2015; Chang, Tao & Wong, 2015; Gregori & Pietroforte, 2015). In Sri
Lanka, the industry has grown rapidly and its influence on the national economy has
dramatically increased to about 8%of GDP. The development of the industry was

1
gunasekaragrd@yahoo.com
2
thanuja03@hotmail.com
3
jrotimi@aut.ac.nz
further expected to exceed the expected growth in GDP of 8-9% over the next five
years due to post-war reconstruction and rehabilitation projects (ICRA Lanka, 2011).
However as per the provisional estimates released by the Department of Census and
Statistics (DCS), the economy grew by only 4.8% during 2015 in real terms, compared
to 4.9 per cent in 2014. This is partially supported by the minor slowdown in
construction (-0.9%) and mining and quarrying (-0.9%) activities (Central Bank of Sri
Lanka, 2015).
Chen (1997) was of the opinion that the increase in economic activities generated a
high demand for construction output which could not be fulfilled by indigenous
resources managerial (contractors and professionals) and technological resources in
Sri Lanka. Thus the industry had to source beyond its boundaries. On a similar note,
Welaratne (2001) indicated that International Contractors (ICs) immigrated to Sri
Lanka with the construction boom experienced in the late 1970’s and 1980’s. The
involvement of ICs further increased rapidly due to post war reconstruction and
rehabilitation projects in Sri Lanka.
Ash and Sollner (1996) indicate that the geographical exchange of intellectual elite,
knowledge, and construction technology is phenomenal since the last decade. On a
similar note, Chen (1997) opined that ICs have succeeded in management of projects,
supervision and training of indigenous construction companies involved in power
generation, transportation, telecommunication and energy exploration. As Ponnusamy
et al (2011) suggest, the movement of professionals has gone from brain drain to the
international exchange of human resources (Ponnusamyet al. 2011).
Developing nations need to generate higher value adding output in terms of enhanced
productivity and thus requires sizeable inflows of ICs and the supervision of highly
talented professionals (Ponnusamy et al., 2011).On this note, this research aims to
examine the significant factors that affect construction productivity and strategies to
mitigate the effects of poor productivity where international professionals and
contractors are involved. The research develops a framework that could enhance the
productivity of the Sri Lankan construction industry.

CONTEXT
The construction industry plays a vital role in the economy while being one of the
decisive social economic governors. It is the world’s most challenging industry, which
consume large number of resources to accomplish its goals (Darmika, 2012).
Rameezdeen, Zainudeen, and Ramachandra (2008) suggest that the construction
industry is one of the most dynamic, innovative and technically advanced sectors in
Sri Lankan economy.
The end of the 30 years of ethnic war in Sri Lanka has placed an enormous demand on
the construction industry with the growth of economic activities. This caused a boom
in infrastructure and building projects in Sri Lanka (ICRA industry report on Sri
Lanka, 2011). However there is lack of knowledge and capabilities in the industry and
it has had to sought assistance from international construction stakeholders, i.e.
international contractors, sub-contractors, professionals, materials and plants suppliers,
funders, investors and etc. Tan (2010) suggests that industrializing countries have low
capacity in their level of construction knowledge and skills of professionals compared
to that of developed countries. The involvement of international contractors in local
projects allows indigenous organizations to gain vast knowledge and experience in
new advance construction technology, advance project management skills, effective
cost controlling methods, incorporation of value engineering and life cycle costing
techniques in the regular practice and implementing the appropriate quality
management procedures. These could improve the total productivity of every
construction project.The involvement of international professionals (IPs) in local
construction projects is therefore vital. Amirhossein, Vaughan, Bambang and Ehsan
(2011) indicated that the involvement of the international stakeholders provides
positive impact on the success of projects and improves productivity

As Kazaz and Ulubeyli (2007) explain, productivity is a vital cause that affects the
overall performance and success of organizations. The term productivity is the ratio
between input and output of a production system which can be used as an index to
measure and evaluate the efficiency and core performance of construction output (Jang
et al. 2011). Hence, the level of productivity often determines the profitability,
performance and success of each and every organization, while contributing to
reduced unit cost. Katyani (2013) has indicated that eight vital factors: technical,
production, organizational, personal, financial, management, government and location,
influence productivity. Further, there are mainly three types of productivity
measurement models used in the industry: Total Factor Productivity (TFP), Total
Productivity (TP) and Labour Productivity (LP). Amongst them, Labour productivity
(LP) is utilized frequently and it measures the productivity of individuals in
organisations and the industry as a whole.

In general, factors affecting construction productivity can be categorized into three:


human factors, management factors and external factors (Liberda, Ruwanpura &
Jergeas, 2003). Human factors comprise: shortage of training and skills, poor attitude,
morale of labour and crew, inadequate communication between workers and
professionals. External factors include: quality of materials, technology, and changes
in designs, government factors, adverse weather conditions, and culture. Management
factors include: technical knowledge, lack of procedures for construction methods, low
level of supervision of workers, unrealistic schedules, high level of work load, salaries
and incentives and lack of knowledge in construction planning.

METHODOLOGY
A multi-method approach was employed to identify the factors affecting productivity
and strategies for the enhancement of construction productivity. Initially a preliminary
investigation was carried out using semi-structured interviews conducted among
experienced international construction practitioners who engage in local construction
projects in Sri Lanka. This approach complemented literature findings on the factors
affecting construction productivity. Subsequently, a questionnaire survey was
administered to 40local and international construction professionals who currently
work in Sri Lanka as Engineers, Quantity Surveyors, Architects, Project Managers and
Construction Administrators. The questionnaire sought their views on factors affecting
productivity due to the involvement of IPs and ICs. Further, the survey was used to
determine the strategies that could enhance productivity on construction projects.

A total of 33 questionnaires were returned and the survey results were analysed using
the statistical t-test which was performed using SPSS software (Statistical Package for
Social Science). For the analysis, the degree of freedom of 32 with 95% confidence
interval and t-table for the mean value of 3.000 offered the critical t-value of 2.037.
Here, the t-value of 3.000 was considered as the minimum requirement to select a
factor as significant. In finding the significance of factors, the following hypotheses
were tested:

Null hypothesis Ho: µ > µo, the mean value of the population for a particular
principle is higher than the mean value of the population, 3.00.
Alternative hypothesisH1: µ ≤ µo, the mean value of the population for a
particular principle is equal or less than the mean value of the population, 3.00.

A t-value of 2.037 was considered as the base value. Therefore factors with t-value of
more than the base value were considered as most significant. A similar approach was
used to identify the significant strategies that could be used to mitigate the negative
effects of productivity.

RESEARCH FINDINGS
Based on t-test statistical values, the significance of factors was determined.
Accordingly, a total of 16 factors were found significant using criteria explained
previously (with t-values above 2.037). Table 1 presents the significant factors
contributing to productivity of construction projects. As observed from the Table, 09
factors out of 16 contribute positively to productivity while the remaining seven
factors contribute negatively. Higher usage of new advanced technology and materials
by ICs, level of knowledge and experience of professionals with regards to modern
construction techniques, higher level of project management and supervision, and
contractors’ attitude to complete work on time were found to have positive
contributory factors to productivity.

Table 1: Significant factors affecting productivity of the construction industry

Sig. Value Std.


No Factors t-value Mean Rank
(2 tailed) Dev
Positive Factors
1 Level of use of new advanced 21.939 4.73 0.000 0.452 1
construction technology
2 Level of experience related to modern 20.888 4.70 0.000 0.467 2
construction techniques
3 Key focus towards performance as 12.279 4.06 0.000 0.496 3
opposed to process flow
Level of knowledge pertaining to 9.915 4.15 0.000 0.667 4
4 projects appraisal techniques (Cost
Benefits Analysis, Total Quality
Management, Value Engineering,
WLCC)
5 Level of project management and 9.712 3.94 0.000 0.556 5
supervision
6 Attitude towards the completion of 8.416 3.88 0.000 0.600 6
work on time and time management and
scheduling
7 Use of new materials and construction 8.124 4.00 0.000 0.707 7
methods
8 Amount of rework 7.223 3.91 0.000 0.723 8
9 Use of advance design software and 7.089 3.76 0.000 0.107 9
concepts
Negative Factors
10 On-site safety policies & riskiness of 17.558 4.55 0.000 0.506 1
work
11 Economic policies, inflation and 9.911 4.12 0.000 0.650 2
exchange rates
12 Level of communication skills and 8.685 4.00 0.000 0.661 3
collaboration with other professionals
and working personals
13 Quality of accommodations and other 4.561 3.39 0.000 0.496 4
personal facilities provided
14 Frequency of design changes and 4.561 3.39 0.000 0.496 5
variations
15 Differences in lifestyles and cultural 4.211 3.61 0.000 0.827 6
behavior
16 Level of managerial influences 3.464 3.27 0.002 0.452 7

On the other hand, frequent design changes and variations, lack of on-site safety
measures and policies, changes in general economic conditions such as economic
policies, change of inflation and exchange rates, poor communication skills and
collaboration between workers and professionals, impact negatively on the
productivity of Sri Lankan construction projects.

In order to mitigate the identified negative factors that were due to the involvement of
ICs and IPs in Sri Lanka, respondents were required to suggest appropriate mitigating
strategies. The results obtained are presented in Table 2. The table presents the
strategies identified and their respective t-test statistics. From the statistical t-test
values, 10 strategies were found to be able to enhance productivity of construction
projects, where IPs and ICs are engaged (i.e. the factors had t-values that were greater
than 2.037).

Table 2: Significant strategies to enhance the construction productivity

Sig. value Std.


No. Strategies t-value Mean Rank
(2 tailed) Dev

1 Developing a strong bridge between


19.433 4.12 0.000 0.331 1
local bodies and international
professionals and contractors
2 Use of advanced technology in local 18.954 4.61 0.000 0.496 2
practice
3 Improve and encourage team work 16.138 4.39 0.000 0.496 3
Establish strict rules and regulations on
4 16.036 4.36 0.000 0.489 4
safety failures
5 Enhance the site accommodations and 13.266 4.00 0.000 0.433 5
other facilities
6 Develop solid designs and use of new 11.677 4.27 0.000 0.626 6
software
7 Improve the efficiency of government 11.626 4.24 0.000 0.614 7
works
Enhance the onsite safety policies and
8 11.608 4.21 0.000 0.600 8
safety precautions
Take sufficient actions to reduce the
9 frequent design changes, variations and 9.937 4.09 0.000 0.631 9
rework
10 Establish stabilized and flexible 7.306 3.85 0.000 0.667 10
financial, economic, political and BOI
polices
As observed from Table 1, majority of the respondents have indicated that lack of
experience related to modern construction techniques, low level of use of advanced
construction technology, rapid safety failures and lack of safety policies, low level of
project management and supervision are the most significant factors which affect the
construction productivity in Sri Lanka due to the involvement of indigenous
practitioners. However, with the involvement of experienced IPs and ICs, these
challenges could be easily mitigated.

Developing a strong bridge (connection) between local bodies and international


professionals and contractors, the use of advanced technology in local construction
practice, improving and encouraging teamwork, establishing stricter safety rules and
regulations are identified as the most significant strategies to enhance the construction
productivity with the involvement of IPs and ICs in Sri Lanka.

CONCLUSION AND RECOMMENDATIONS


The effect to construction productivity due to the involvement of international
professionals and contractors in Sri Lankan construction projects has not been
explored. Thus the current research explored the factors that affect construction
productivity due to the involvement of international professionals and contractors in
local projects. The factors could either have a positive or negative effect on
construction productivity. Using statistical values obtained from t-tests, nine factors
were found to be significant and positively contribute to productivity on construction
projects in Sri Lanka. Another set of seven factors were found to negatively impact
construction productivity.

In order to mitigate these negative factors, some strategies were identified through
interviews. The research found that top three strategies to minimize the negative
effects include: developing strong relationships between local bodies and international
professionals and contractors, adopting advanced technology in local construction
practices, and encouraging team work among local workers and IPs and ICs. Focusing
on the factors and strategies identified in the current study, an appropriate framework
is proposed which could assist in appraising the involvement of IPs and ICs prior to
the commencement of particular projects in Sri Lanka. Figure 1 presents the proposed
framework for productivity enhancement in construction projects where IPs and ICs
are involved. The framework consists of both positive and negative factors. As shown
in the Figure by tracking each negative factor with the use of this framework can
identify the relevant strategies to overcome the related negative factor.

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Better profitability can be achieved through a better productivity
CONSTRUCTION
PRODUCTIVITYIN SRI LANKA PROFITABILITY

FACTORS AFFECTING ON

Better performance can be


STRATEGIES TO ENHANCE

achieved through a better


PRODUCTIVITY PRODUCTIVITY

profitability
Positive Factors for IPs and ICs

Use of new materials and construction


methods
Attitude towards the work completion on time
and time management and scheduling

Level of project management &supervision


Factors - Involvement of IPs

Level of experience related to modern BETTER


construction techniques PERFORMANCE
and ICs

Level of new advanced construction


technology
Key focus towards performance as opposed to
process flow

New design software and concepts


Strategies to enhance productivity
Personal Factors
Amount of Rework
Managerial Factors Enhance the onsite safety polices & safety precautions
Level of knowledge pertaining projects
Use of advanced technology in local practice
appraisal techniques (Cost Benefits Analysis, Organizational Factors
Total Quality Management, Value
Negative factors for LP & LCS

Improve and encourage teamwork


Engineering, WLCC)
Technical Factors
Make a strong bridge between local bodies and
External Environment international professionals & contractors
Negative Factors for IP’s and IC’s
Develop soiled designs and use of new software

Onsite safety policies & riskiness of work Establish strict rules & regulations against safety
Factors- Locals Professionals and

failures
Level of communication skills and Improve the efficiency of government works
collaboration with other professionals and
Establish flexible financial, economic, political and
Contractors

working personals
Differences in lifestyles & cultural behavior BOI policies
Positive factors for LP &LCS

Frequent design changes and variations Take sufficient actions to reduce the frequent design
changes, variations and rework
Economic policies, inflation and exchange
rate Enhance the site accommodation and other facilities
Policies &the influences of the government

Level of managerial influence

Quality of accommodations & other facilities

Figure 1: A framework to enhance the construction productivity