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A FRAMEWORK TO ENHANCE THE PRODUCTIVITY IN
CONSTRUCTION PROJECTS INVOLVING INTERNATIONAL
PROFESSIONALS AND CONTRACTORS: CASE OF SRI LANKA
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.
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.
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.
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).
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.
REFFERENCES
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influences of stakeholder management on construction project quality. In
Proceedings of 1st International Construction Business and Management
Symposium. Kuala Lumpur, Malaysia: University of Teknologi.
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construction industry. Journal of Construction Management and
Economics.18, pp.15-27.
Ash, M. G. and Sollner, A. (1996) Forced Migration and Scientific Change.1sted.
Central bank of Sri Lanka. (2015) Annual report 2015. Colombo: Central Bank of Sri
Lanka
Chen, J. J. (1997) China's construction industry and foreign investment. Building
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Chiang, Y. H., Tao, L., and Wong, F. K. (2015). Causal relationship between
construction activities, employment and GDP: The case of Hong Kong. Habitat
international, 46, 1-12.
Darmicka, R., (2012). Repercussion of foreign labour on construction productivity in
Sri Lanka. Unpublished undergraduate dissertation, University of Moratuwa,
Sri Lanka.
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http://www.eulerhermes.com/mediacenter/Lists/mediacenter-
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Gregori, T., and Pietroforte, R. (2015). An input-output analysis of the construction
sector in emerging markets. Construction Management and Economics, 33(2),
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%20Sept%2015%20final.pdf.
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Better profitability can be achieved through a better productivity
CONSTRUCTION
PRODUCTIVITYIN SRI LANKA PROFITABILITY
FACTORS AFFECTING ON
profitability
Positive Factors for IPs and ICs
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