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The importance of confidence in project management

Jan Sandabacka

1. Abstract

Beliefs have a strong physiological impact on the human behavior. They have a self-fulfilling prophecy effect. People’s beliefs usually come true, because they act as if those beliefs would be true. Thus, it helps them to reach their goals. Right beliefs are important in the project management. It is especially important that project managers believe in their projects and their teams. Project managers set the goals of the project and have a strong influence on the team spirit and attitude. They guide the team in daily problem-solving situations. The confidence in the project - or the lack of it - plays an important role in all of these activities, and in many cases it makes the difference between the success and the failure.

Acting confident is not enough. If project managers are not confident enough, they must seek the confidence by evaluating the project risk and success factors, finding motivation for the project, and seek support from team members and stakeholders. A portion of autosuggestion is needed, also.

2. Keywords

Project management, beliefs, people management, confidence, optimism, leadership, positive mindset

3. Introduction

In January 2004, our company (F-Secure corporation) redefined our slogan to “BE SURE”: Our customers can be confident when they have installed our security products, consisting of anti-virus, firewall, intrusion prevention, anti-spam, application control and parental control solutions.

We were all asked to think about what this means in our daily work, so I started to think about confidence in the project management. Looking back on previous experiences, I started to realize the importance of the project manager who believes in the project.

4. The psychological impact of (the right) beliefs

I have read some literature about Neuro-linguistic Programming (NLP). The NLP emphasizes the impact that beliefs have on the behavior, and the importance of having the right beliefs [1]. Beliefs have a self-fulfilling prophecy effect. One example of this is the Pygmalion effect, where a group of students was divided into two groups. Both groups had the same average IQ, but teachers were told that one of the groups had a very high IQ. Naturally, this raised the expectations for this group. Even though the only difference between the groups were teachers’ beliefs and expectations, the “high IQ” group performed much better in tests. [2]

The Placebo effect is a similar example from the field of medicine. People have been cured when they have just believed that they get a super-medicine, when in fact they have been given only a placebo without any effect at all [3].

A reason for the self-fulfilling prophecy effect is that beliefs guide the behavior. People act as if their beliefs would be true [1]. Therefore, negative beliefs limit people's capabilities a lot. If people think they cannot do something, then their mind is expecting a failure and unconsciously this will direct their actions. Most probably, they will not really do their best: Why really bother when the failure is inevitable? In the worst case, they will not try at all. Even if they try, there is a big risk that when the first problem arises they interpret it as a confirmation for their failure in the attempt that was doomed in the first place. They might easily give up. You probably have experiences from such situations yourself.

Positive beliefs, on the other hand, will enhance personal capabilities. If people are sure that they will succeed, they are energized and enthusiastic. They will eagerly do their best and make sure that they fully utilize all their skills and resources. Furthermore, positive beliefs challenge brains to seek and produce solutions to emerging problems, as they know (believe) that there are a lot of solutions out there just waiting to be found. The outcome is that if one solution is not good enough, people try another until a successful one is found.

“They are able because they think they are able.”

Virgil (70-19 BC)

The belief and the resulting success/failure will also work as a reference for future actions. Anthony Robbins presents the following feedback loop: Beliefs/Attitude; Potential; Action; Result; Belief/Attitude[4]. Beliefs and attitude (which are very closely linked together) will affect the potential people have (or think they have). This guides their actions and behavior, which leads into results. The result will then strengthen the previous beliefs even more. If the beliefs were negative, people will be even more convinced that a similar attempt will be a failure the next time also and so it has a negative belief-behavior spiral effect. On the other hand, with positive beliefs the success will give a track record that will strengthen people’s beliefs in their potential even more (a positive behavior-belief spiral). People with positive attitude are more likely to get the expected result. They are convinced that they will reach the result sooner or later. This motivates them to try different actions until they reach their goal.

5. The importance of the right beliefs in the project management

The project manager’s beliefs and actions based on those beliefs are important for the success of the project in several ways. I would highlight at least the following areas:

• Attitude and spirit shaper of the whole team;
• Problem solving attitude;
• The Pygmalion effect; and
• Goal setting.

The project manager is the attitude setter of the whole team, both directly and indirectly. Beliefs affect the behavior of one person. With a team, the effect is multiplied by the amount of team members. If the project manager does not believe in his project, it can be seen in the way he coaches the team, or rather in the lack of coaching. The project manager will have a hard time to find the energy to do coaching if he is not convinced about the project himself. Coaching, or the lack of it, will have a great impact on the success and the general team spirit [5]. Without coaching, people feel that they work in a project that no one believes in or cares about. With a confident project manager driving the project, the team members feel that they are working in an exciting project and have an enthusiastic leader that helps them forward in their everyday work.

The project manager's confidence has indirect effects, also. Team members keep an eye on their project manager. They will notice expressions and the body language. If the project manager comes to work every morning looking troubled, team members will be worried as well for sure. On the other hand, a smiling project manager who looks confident lightens up the team and makes them feel safe. The project manager’s enthusiasm is soon transmitted to the whole team. So keep smiling, the team is watching you!

The atmosphere in the project is also more likely to be positive and relaxed overall, if the team members and their manager believes in what they are doing. A relaxed, positive team spirit enables creativity and motivation. It also reduces the risk of stress and burnouts.

Additionally, beliefs affect the communication style, which project manager uses. For example, a pessimistic project manager could use words like “Difficulties”, “Crises”, “Threats” and “Dead ends”, while an optimistic project manager would talk about “Challenges”, “Urgent situations”, “Opportunities” and “Turning points” instead. These words send out very different signals to the team members and very much affect how they look at the situation or respond to a sudden change.

The attitude to look at problems is very closely related to vocabulary. The typical software project manager will face problems or challenges most likely every day. His beliefs are then crucial to how he reacts to these problems. Does he feel that each problem is just another proof that his already impossible project should have been never launched? In this case, his response is probably something between resignation and a half-hearted attempt to solve it. His team will most probably follow his example.

The confident project manager knows that challenges (note the word he uses) belong to everyday life of software projects. He is confident that he and his team will be able to solve problems and sees them as just another opportunity for the team to learn and develop. Furthermore, the positive attitude engages the creativity of each team member and enables them to look at the problem from different angels, which helps them to come up with a wide range of alternatives and solutions.

“Problems are only opportunities in working clothes.”

Henry J. Kaiser

As another area of the project success, we have the Pygmalion effect [2] mentioned earlier. Not only does the project manager need to believe in his project, but it is very important that he believes in his team, also. Due to the Pygmalion effect, the project manager unconsciously treats team members according to his beliefs and they respond correspondingly. A project manager who thinks he has a team of senior top performers treats them as such. So, team members do their best to meet these expectations and the self-fulfilling prophecy comes into effect. They earn the given trust. Vice versa, if the project manager treats team members like inexperienced novices - over-guides their work or shows that he does not trust them - it affects their performance negatively [5].

Last but not least, we have the goal setting in which the project manager typically plays a very central role. Planning and goal setting are phases in the project that determine what the project aims to achieve and setting the right goals is crucial. A pessimistic project manager feels that goals, which are set for the project, are very hard to begin with so most probably he tries to reduce the ambition level of planned goals to have some chance of getting even the half of the project scope done. On the other hand, the confident project manager challenges both himself and his team to set high goals and inspires the team to reach them.

6. Getting confident

Now we have seen the importance of confidence, but what should you do as the project manager if you do not feel confident about your project? There can be several underlying reasons for this: unrealistic goals or schedule, inexperienced team, unstable or unclear requirements, and so on.

Of course, you could try to act confident. In this case, you would have to be a very good actor and you should remember to keep doing so all the time, since team members are watching you - also when you least expect it. Most likely the acting takes a lot of unnecessary energy from you and it does not replace the real excitement and engagement that a truly confident project manager has. So, acting might work as a first aid, but you still need the real confidence.

Naturally, the first step to get the real confidence in the project is to address the underlying problems that cause doubts about it: negotiate goals or the schedule, train the team, clarify the requirements and so on. If this is possible, it is a quite straightforward approach.

As a second step, I would suggest to do risk analyses. Try to schedule the biggest risks to the beginning of the project. Everyone can be more confident once those high-risk issues have been eliminated.

The next step would be to raise your own motivation. When you are well motivated and excited, it is easier to believe in your project. A support from external stakeholders can be helpful in here. Find out the following:

• Why the project is needed? What benefits it will bring to your company?
• What benefits will this bring to the end customers?
• What opportunities does this bring to you and to your team? What new things or technology can you learn? What kind of experience can you gain?
• Will there be a reward if you are successful?

If you are not confident about your team, sit down with them. Get to know them and find out what they have done earlier and their experience level. Also, seek their support for the project and involve them in it. Most probably you will be impressed with what you hear and you will find it easier to trust them.

Furthermore, list the success factors you have in your project. Try to find as many as possible together with your team. When all success factors are written down, you can all see positive sides of the project.

Finally, try the autosuggestion. Go through all the benefits, opportunities and success factors by yourself. Create a positive mental image of a successful project. If nothing else helps, pretend that you believe that the project is possible and act accordingly. After a while, you will notice the self-fulfilling prophecy effect and your confidence will rise.

I have tried and noticed that the autosuggestion works on myself. A short time back, we had one very challenging project, which had a quite unrealistic schedule. Still, it was not in our power to affect this schedule, due to external commitments. We forced ourselves to believe in the project. This was hard in the beginning, but it became easier and easier as we progressed. The belief encouraged us to look for alternatives and in the end, we were able to pull through the project successfully. Of course, we also had an excellent team to do the work. A lot that I have written in this paper is based on experiences gained from that project.

6. A few words of warning

Strong beliefs alone will not make a project successful. Proper planning, project management discipline and a software development process all need to be in place. This has been an assumption for everything I have written. Proper planning is also a good way to become more confident.

Even if optimism is good in the goal setting, be careful with over-optimism. Unrealistic goals do not motivate people and are not met likely [5][6]. You might set up challenging goals, but make sure you know where you can cut corners, if the equation becomes impossible. If you look at the project management triangle with Scope (including Quality) – Resources (Budget) and Schedule at the corners, you need to know what can and cannot be negotiated.

When challenging people to reach optimistic goals, be careful not to pressure them too much. The idea is not that they should put in more hours and start doing longer working days. Instead, inspire them to be creative about solutions. Tell them that you think the goals are possible and you need to figure out how to achieve them together. Convince team members and then brainstorm to find alternatives. Try different angles and approaches until you get satisfying results.

8. How my beliefs affected writing this paper

While I was writing this paper I once more faced a confidence problem. I doubted whether I will be able to write this paper by the given submission deadline. I was involved in a pair of hectic projects, which took most of my working time. At home, our newborn baby daughter kept our family awake during nights, which did not help the situation in any way.

I was almost ready to give up writing this paper, as I believed that I could not do it. Then it struck me that the task was down to my beliefs and I realized that those beliefs would make it or break it. This gave me my inspiration back. By writing this paper, I would prove that beliefs make a difference, which would give me an excellent angle to look at the problem. Then I started to convince myself, which was the turning point. The writing started to progress and my confidence rose as the text evolved.

9. Conclusion

I will summarize the above-discussed matters into the following conclusions:

• Beliefs guide behavior. Due to the self-fulfilling prophecy effect, it is very important that project managers believe in their projects and in their project teams (The Pygmalion effect).
• Project managers' attitudes and beliefs have a great impact on the whole project and the rest of the team. This is true for the team spirit / attitude, goal setting and problem solving approach.
• If project managers are not confident about the project when it starts, they must seek that confidence. To do this, they must find out the cause for the uncertainty, list the project risks and success factors and seek the support both from their team and the stakeholders. Autosuggestion has proven to be helpful, also.
• Setting optimistic goals should be done so that something can be traded off later, if needed. The focus should be on finding creative solutions with a positive team spirit.

10. Acknowledgements

I would like to thank all the people that encouraged me during the writing. A special thank you to Vasco Duarte for initially convincing me to do the submission!

Finally, I would like to wish you good luck with your projects! Have faith in your projects and your team members. You will make it!

11. References

1. O’Connor, J & Seymour, J. Introducing NLP Neuro-linguistic Programming: Psychological skills for understanding and influencing people. Revised edition. Hammersmith, London: Thorsons, An Imprint of HarperCollins Publishers. 1995. 245 p. ISBN: 1-85538-344-6

2. Rosenthal R. & Jacobson L. Pygmalion in the classroom. College ed. New York: Holt, Rinehart and Winston. 1968. 240 p. ISBN: 0-03068-685-7

3. The Placebo Effect From Wikipedia, the free encyclopedia available at http://en.wikipedia.org/wiki/Placebo_effect

4. Robbins A. Unlimited Power. the new science of personal achievement . New York: Simon and Schuster. 1996, 361 p. ISBN: 0-67161-088-0

5. DeMarco T. & Lister T. Peopleware. Productive Projects and Teams. 2nd ed. New York: Dorset House Publishing Co. 1999. 245 p. ISBN: 0-932633-43-9

6. Chezzi C., Jazayeri M. & Mandrioli D. Fundamentals of Software Engineering. Englewood Cliffs, New Jersey. Prentice-Hall, Inc., A Division of Simon & Schuster. 1991, 573 p. ISBN: 0-13-818204-3

Bio summary

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A quantity surveying perspective

Eugene Seah

Synopsis

The process and legal principles of tendering are part of the everyday life of a Quantity Surveyor (QS). However, with the advancement of technologies, these processes may change. Such advancement has brought E-Tendering into the equation of procurement. E-Tendering, in its essence, does provide the QS with productivity-enhancing capabilities. However, if managed incorrectly, it will cause much grief to both the consultants and the tenderers. This paper looks at the approaches of E-Tendering, the inputs and considerations that QSs (both the consultant and contractor) should take note of and lastly, it discusses the use of Electronic Interchange Agreements that sets the protocols of handling information.

General

With the heightened use of technologies, processes in any industry will change or will have changed. The construction industry of Singapore has been radically changed by the use of Information Technology (IT) in almost all aspects in the construction process. Examples to be cited are the usage of Web-based collaboration tools and E-Tendering.

The process of tendering is well understood by Quantity Surveyors (QSs). This process has been ingrained in QS training – the process has to be known by heart. However, with the coming of E-Tendering, the question is the following: Will the traditional QS process for tendering still be relevant? Would there be additional considerations both contractual and essential effectively to facilitate E-Tendering? This paper discusses the general considerations for E-Tendering and is only meant to focus on best practices and is therefore not exhaustive.

Before proceeding with the object of this paper, the author would like to highlight the concept of E-Tendering in general. In Singapore, the E-Tendering concept is part of the entire paradigm of CORENET, which stands for Construction and Real Estate Network. Aimed at improving overall productivity, efficiency and efficacy of the construction industry of Singapore, CORENET is a government initiative that encourages private and public participation by the various players in the construction industry. The object of E-Tendering is specifically to increase productivity during the tendering process by decreasing paper handling and speeding up communication and interaction.

The E-Tendering tools usually come in the form of web-based platforms, which are governed by construction exchange portals. Usually nicknamed Tender Engines, the tender process, which is originally performed manually, is transformed into E-processes and performed over the internet. Bills of Quantities and Work Package breakdowns are uploaded into the tender engine. In some portals which operate on the Construction Industry Trade Electrically (CITE1) format, the tenderer can input the rates and/or quantities into the engine which easily processes the information into intelligent and useful data for the consultant QS to evaluate and report.

This entire relationship can be illustrated in Figure 1 below:

It is usual for the tender engines to have the facility for the contractor to upload documents. This is usually in the case for Design and Build tenders whereby the tenderer can upload the Contractor’s Proposal. Some advanced tender engines will even contain an E-market place whereby the Main Contractors may enter this e-domain to obtain quotations from other subcontractors, suppliers and specialist contractors sharing this domain.

Once the quotations are obtained, the main contractor may select the cost-effective quote to be compiled in the tender engine for submission. In addition, such tender engines will also have a security procedure and management system in place (e.g. private/ public key systems, key pair systems and firewalls) to ensure authenticity and security of the entire tendering process. (See Figure 2).

Contractual Issues

The author would like to cover four essential contractual issues to be considered by a Consultant QS. These four issues centre mainly on the conditions of tendering/ instructions to tenderers, the form of tender, tender submission input by consultants and considerations for the preliminaries.

Conditions of Tendering/ Instructions to Tenderers

The conditions of tendering will contain salient clauses that govern the rules of tendering prior to the formation of the contract between the Employer and Contractor. If this process is going to be incorporated into the E-tendering process, traditional clauses may not be applicable.

The following is recommended to be included for consideration in the conditions of tendering:

1. Highlight the main contents in the tender document in the tender engine;
2. Inform the contractor to counter check the documents that have been uploaded into the tender engine.
3. Stipulate the tender querying period that is to be carried out on-line and the cut-off date of such period.
4. Instruct the tenderers to table the documents and drawings submitted where there are alternative designs or proposals made. This will enable the consultant QS to check if all documents have been uploaded successfully into the tender engine. There are instances where documents are not fully uploaded due to the lapse or time-out as a result of slow uploading speed. Information to consider will include but not limited to:
   1. Serial Number of File
   2. File name
   3. File description
   4. Version number
   5. No of Pages in document
   6. Approximate memory size of file
5. Instructions to assist tenderers to obtain the digital certificates (usually from government or privately designated third-party vendors) needed to clear the security for submission.
6. Reminders to tenderers to top-up credit accounts for e-payment purposes (if a payment engine is used for clearing of on-line payment).

It is unwise to leave the conditions of tendering and the specific instructions to navigate within the tender engine and its submission process ambiguous. Generally, the level of IT adoption in the Construction Industry of Singapore is generally low since 1999; thus, it cannot be assumed that the e-tendering process is well understood by the participating contractors.

Forms of tender

The form of tender is another important contractual document that warrants attention by both the consultant QS and the contractor QS. In Singapore, there are many forms of contract, ranging from the Singapore Institute of Architect’s (SIA) form to the Public Sector Standard Conditions of Contract (PSSCOC). The latter, being a government standard contract, has a standard form pertaining to the form of tender, but the former leaves it to the consultant QS to draft its conditions. The consultant QS would have to consider how to amend the form so that the submitted e-form would still be contractually binding. And, the contractor QS would have to be extra prudent in its submission as certain private forms of tenders would have clauses to say that the figures (written) in the forms of tender would supersede that of the final summary if there is a discrepancy between the two. Some recommendations are:

1. Instructions to the tenderers to fill in the form of tender in the tender engine;
2. Instruction and checks in filling the form of tender, including the endorsement of the
3. form with the contractor’s digital certificate;
4. Clauses to indicate that in the event of discrepancies, the amount written in words will
5. Prevail;
6. Clauses to include that until a formal contract is drawn up, the tender (with the contractor’s written agreement in the form of a tender, including the contractors digital certificate stamp) shall be binding.

der submission considerations - the consultant’s input

It is common that e-tender engineers work in conjunction with web-based collaboration tools. This celebrates the effectiveness of concurrent engineering with the productivity of tendering all as one. However, even though design information can be coordinated during the design development stage, design consultants can be carried away in the number of revisions in the drawings or not even recording the revisions. Thus, it is preferable that an E-Tender manager or coordinator is appointed for coordinating the uploading of the tender documents. This task usually falls in the laps of the consultant QS. The following are considerations in the field of best practices:

1. Elect a consultant to coordinate the input of the documents into the tender engine and onitor its revisions.
2. All electronic documents are to be vetted by the PM’s / Client’s representative before
3. uploading to ensure currency of the document
4. Files to be uploaded should be compressed/ zipped to reduce the uploading time and
5. storage space in the E-Tender engine.
6. File names of documents and drawings should be named / renamed as a readable
7. name for easy identification. This is opposed to coded names (e.g.
8. 10022004PAQS_FOT_et.doc VS Form of Tender 10022004_Etender.doc ).

There are also other issues to be considered by the consultants, issues such as copyrights and Intellectual Property (IP) issues. The following should be considered and adhered:

1. Ensure that all documents are submitted as portable data files (PDFs) to maintain minimum copyright;
2. Ensure all drawings files, unless otherwise stated, are read-only or plot files; and
3. If there are setting controls in the tender engines, the tender coordinator may set the tools in the tender engine to enable the contractor to view the file instead of downloading and printing the files and drawings.

During tender submission, the contractor is required to adhere to the following considerations:

1. The contractor is to submit the form of tender on-line together with all the priced sections;
2. There is no need for the contractor to resubmit the non-priceable documents e.g. specifications;
3. Tracking of the originality of the documents can be traced by the origins of the properties of the document which would have been tracked by the tender coordinator;
4. The contractor is to encrypt the submitted documents with the contractor’s digital certificate (preferably corporate certificate); and
5. All documents submitted should be submitted on a common platform and version. For example, MS Office 2000 or AutoCad 2000.

Preliminaries

To ensure the success of E-Tenders or any web-based applications, the contractor has to be primed and informed of what is needed for the tender. Consultant QSs will carry this out via the prelims. There should be provisions for:

1. Internet/ lease line connection on site (specified if wireless cabled);
2. Number of Personal Computers/ Laptops;
3. Minimum requirements of the hardware (e.g. minimum Pentium III/ Processor speed and RAM needed);
4. Mention the type of software the hardware should have (e.g. MS Office 2000,
5. including MS Word and PowerPoint, AutoCAD 2000 etc);
6. Paramount to state who the hardware and software should belong to at the end of the project and in what condition the accessories are expected to be; and
7. There should not be any catch-all clauses as these would artificially increase the tender price

Electronic Data Interchange Agreements

It is uncommon for nations to have acts governing the use of electronic data. For example, there is the Electronic Transaction Act that briefly endorses the effectiveness of electronic information such as emails and attachments. However, this does not address the process and considerations that govern the standard of information that is being submitted nor does it address the way information can be authenticated (between the digital information and the actual information that was uploaded); hence, the formation of a Electronic Data Interchange Agreement (EDIA).

There was an attempt to start a standard EDIA document in the construction industry of Singapore. This was because all methods of communication require a set of minimum standards of discipline to be observed by the communicants so as to ensure that the information communicated is effective. Thus the EDIA can be said to attempt to set out the minimum standard with respect to the exchange of data and information via electronic means. By agreeing to an EDIA, the parties cannot claim to be ignorant of the rules and conditions in the standard.

The EDIA sets out to complement the underlying commercial or contractual obligations of the parties involved and it does not set out to alter what the contracting parties have agreed to in the main contract. Thus, this EDIA is indeed a separate agreement with the need separately to sign the EDIA document. Here are some of the salient points that the EDIA must contain:

1. A sender may request that the receipt of its message be acknowledged by the recipient
2. A sender may request, in addition to the acknowledgement, confirmation from the recipient that the consent submitted meets the recipient’s requirements.
3. A proof of copy of work is to accompany the transmission i.e. to Cc to project folder or achieve.
4. Agreement that pre-tender information to be burned and stored into a Read Only (RO)
5. Compact Disc (CD). This is to protect the recipient when accused of modification or tampering with the original documents.
6. This ROCD can be kept at a 3rd party’s premise or stored in an off-shore account to be agreed to by the parties.

Conclusion

The era of E-Tendering and e-processes in the construction industry is here to stay. It is a positive move to globalisation with the breaking down of the national barriers with the use of the Internet. This paper celebrates the amalgamation of new economy thinking and processes with old economy values and traditions. E-Tendering does not bring along a total paradigm shift, rather, it yields many benefits to productivity and efficiency, promoting business efficacy with a minimal need for a business process re-engineer (BPR) to augment the current process. BPR may be needed on in-house QS software to cater for E-Tendering (e.g. conditioning the QS software to CITE compliance). Nevertheless, E-Tendering will bring much excitement to the construction industry of Singapore and to the world once it is fully embraced and implemented, creating a new breed of QSs to do the job.

1 Standard for interoperability between Bills of Quantities/ Sectional Breakdown QS software, tender editors for the tenderer’s input for OH&P and allowances and package assemblers for the repacking of the BQ items for procurement with suppliers and specialist contractors.

Author's profile

Mr Eugene Seah is working as an Associate in Davis Langdon & Seah Singapore Pte Ltd. In his career, he was involved in setting up E-Tendering Procedures for a Construction Exchange Portal. He has a BSc in Quantity Surveying (1st Class Honors) and a BSc in Technology Management and Computing (1st Class Honors) and is currently undergoing a PHD in Information Management from the University of Reading. He is active in institution work and is a member of SISV, SIArb, SIBL, AIQS, SCL and CIOB. In addition, he is also enrolled for an MSc in Construction Law and Arbitration at Kings College University. Mr Seah is interested in contemporary technologies and management paradigms that enhance the quality of the construction industry as a whole and is eager to learn and participate in Industry Work.

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Peter Smith

This paper examines trends in the Australian Quantity Surveying profession since 1995. The paper is based on research conducted by a team from the University of Technology Sydney involving a series of five national surveys spanning 1995 to 2003. The surveys have examined trends in general practice and the utilization of information technology by the profession. The primary purpose of the surveys has been to assist firms in dealing with change and to adapt their operations to meet industry demands. Firms in all sectors of the construction industry will need to work smarter to gain competitive advantage and current industry procurement and technological trends clearly indicate that firms who are unable to re-engineer their work practices to evolve with these trends will find it increasingly difficult to survive in a meaningful and profitable form. The paper initially examines trends in the structure/size/nature of the profession and trends in general business practices and scope of services. This is followed by an in-depth examination of trends in the utilisation of information technology by Australian Quantity Surveying practices. The survey responses are then used to examine current problems and opportunities in the profession and what needs to be done in the short and longer term. The paper concludes with a range of recommendations and strategies that attempt to address these problems and ensure the relevance and importance of the profession well into the future. The paper will also provide the international quantity surveying community with a unique data source that should prove valuable for comparative purposes and general discussion about the global future and direction of the profession.

Keywords: Quantity surveying, Information technology

1. Introduction

The Quantity Surveying (QS) profession in Australia has experienced significant change over the past decade in terms of the scope and type of services provided both within and outside of the construction industry. These changes have occurred primarily in response to changing industry/client demands, Information Technology (IT) developments and increased levels of competition for services. Additionally, given the increasingly global nature of construction activity, increased international competition is of serious concern to all participants in an Australian construction industry dogged by extremely high levels of domestic competition and resultant low profit margin levels. The impact of changes in industry structure and procurement practices on the quantity surveying (QS) profession will continue to escalate. As information flows increasingly become electronic QS computing facilities, software and databases will need to develop in a compatible manner. Compatibility with and the utilization of CAD systems is just the beginning. It is inevitable that documentation and data will be increasingly automated to the point where measurement and other technical processes will require minimal human intervention.

This naturally leads to speculation about the imminent demise of the independent quantity surveying consultant but the reality is that, at this stage anyway, IT advancement provides the profession with enormous opportunity to actually strengthen its position in the industry. Quantity surveyors are well placed to become the major information handlers on construction projects as the majority of information flow evolves around quantities and cost.

Realistically though, no profession or discipline can legitimately lay claim to being best suited to take control of information management. It is likely that current opportunities will be taken up by others if the profession adopts a "wait and see" approach. This paper examines the trends and future directions in the services provided by the Quantity Surveying profession in Australia since 1995. It is based on research undertaken by a team from the Project Management Department at the University of Technology Sydney (UTS) comprising five nationwide surveys of the profession carried out from 1995 to 2001. The author would like to acknowledge the assistance of this team, namely Rick Best and Gerard DeValence, with the research for this paper.

2. The Australian Quantity Surveying profession

Quantity Surveyors in Australia provide financial management services for projects predominantly in the construction/property industry. Traditional services include the preparation of Bills of Quantities, Builders’ Quantities, Cost Planning/Budgeting, Estimating and Contract Administration. The past decade has seen a marked rise in the diversification of services into non-traditional areas such as Feasibility Studies, Life Cost Analyses, Programming, Taxation Advice, Arbitration/Mediation, Expert Witness/Appraisal, Insurance Valuations, Risk Management, Quality Management, Value Management, Project/Construction Management and Facility Management. In the past five years, the profession has also made significant inroads in providing cost management services to other industries such as the Petro-Chemical, Manufacturing, Mining, Aeronautical, Shipping, Transport and Civil sectors. This diversification is a result of the profession adapting to meet changes in industry requirements.

The size of the profession is relatively small. Total membership of the Australian Institute of Quantity Surveyors (AIQS) is currently just over 3000 with only approximately 1200 corporate members (the rest made up of student/probationer members). However, there are generally no registration requirements for Quantity Surveyors (except in the state of Victoria) and no requirement to be a member of a professional association. Therefore, the AIQS membership does not reflect the total number of practitioners in the industry but, nevertheless, provides a good indication. The majority of firms in the industry are small having five employees or less and there are a large number of sole practitioners. This is an important aspect to remember when analyzing the survey results.

This is reflective of the extremely fragmented nature of the industry not only in Australia but globally. The industry in Australia is characterized by a large number of small organizations with over 100,000 small businesses operating in the industry. 98% of firms employ less than 20 people and 85% employ less than 4 people (Hutt 2000). Over 90% of construction work is subcontracted and project team consultants and contractors are typically assembled for individual projects in an ad-hoc "one-off" pattern with decisions on project team composition largely made on the basis of lowest price. Hence, project teams are assembled and disassembled on a project by project basis with little continuity of project team members over the long term. During the course of large projects, there are typically hundreds of firms (consultants, contractors, suppliers) involved during the various stages with a high level of "change-over" between the various trade contractors. Additionally, every project is a "one-off" prototype. Current initiatives to address these problems include alliance contracting, joint venturing and "single-source" delivery of services extending into the operational stages of projects.

Due to a lack of industry standards, each of these firms has their own organizational / management systems in place encompassing a wide range of technological capabilities and software usage. The wide range of software systems used and the incompatibility between many of these systems severely limit the scope for the industry to take advantage of the rapid technological advances surrounding it. Exacerbating this situation is the generally low profit margins in the industry which inhibit the ability of firms and the industry generally to make the necessary investment in IT systems, research and development. Other key problems include the complexities surrounding information flow on construction projects, the lack of information and process standards, the traditional "paperbased" mindset of the industry and legal and contractual issues relating to electronic documentation and records.

The manner in which developers, designers, consultants and contractors manage the entire building process will continue to change. These changes will result in not only substantial restructuring of how facilities are designed and supported but also a major reengineering of how these players do business. This presents the profession with an amalgam of opportunities and threats. This technological revolution will enable the profession to raise its level of service to a much higher and professional “value-adding” level as the technical aspects of the quantity surveyor’s role increasingly become automated. The potential is there for quantity surveyors to be freed up from many of the time consuming technical aspects of their profession and focus on developing more sophisticated and professional services. Conversely, if firms fail to utilize and evolve with technological advances, particularly in terms of CAD and electronic transfer and receipt of information, they run the very real risk of being squeezed out of the virtual electronic project teams of the future. Accordingly, this paper will examine the results of research conducted on how the profession is evolving and meeting the challenges that these changes are providing.

3. QS Survey results and analysis

This section examines the general practices of Australian Quantity Surveying firms over the past 9 years. It is based on five nationwide surveys of the Australian QS profession carried out from 1995 to 2003 by a research team in the Project Management Department at the University of Technology Sydney in collaboration with the Australian Institute of Quantity Surveyors (AIQS). The 1999 survey was also carried out in collaboration with the Pacific Association of Quantity Surveyors (PAQS). These survey results enable evaluation of how the profession has reacted over the past nine years to the challenges and opportunities that industry change and technological development have presented.

3.1 Survey details

The surveys comprise a series of nationwide surveys of Quantity Surveying firms carried out in 1995, 1998, 1999, 2001 and 2003. 77 firms (out of 160), 65 firms (out of 126), 42 firms (out of 130) and 60 firms (out of 134) responded to the 1995, 1998 and 2001 surveys respectively representing response rates of 48%, 52%, 32% and 45%. The 1999 survey was posted to all AIQS members as part of a PAQS survey with 38 firms responding. The surveys comprised a number of questions concerning general practice details, information technology capability and use and future directions of the profession. The questions were largely the same for each survey but some questions were added to the 1999, 2001 and 2003 surveys.

3.2 Respondent profile

Figure 1 shows the location of respondents (question was not asked in the 1999 survey).

This generally reflects the population sizes in the various states/territories of Australia world with the vast majority of the population residing in the capital cities of each state/territory. Accordingly, respondents from the capital cities of Queensland, New South Wales and Victoria dominate the survey.

The respondents predominantly comprise small to medium sized organizations which is typical of the profession's (and industry’s) structure. Approximately half had less than 5 employees and a large proportion of respondents were sole traders. These are significant factors when analyzing the survey results. Nevertheless, close to half have been in business for over 20 years which suggests that longevity is a feature of the profession

3.3 Services provided

The past decade has seen Quantity Surveying firms expand and adapt their scope of services to meet changing industry demands. The use of the traditional "bread and butter" of the profession, Bills of Quantities, has declined markedly in the Australian construction industry over this time although the latest survey results indicate that there has been a resurgence in this area in certain market sectors. Despite this, the volume of work carried out by firms has increased over the corresponding period. Builders Quantities, whereby tendering contractors themselves (rather than the client) engage and pay Quantity Surveyors to prepare quantities are now far more common than the traditional Bill of Quantities provided and guaranteed by the client. Builders Quantities are usually prepared in a concise form with firms using their own concise standards; no standard concise method of measurement has yet been developed.

Another major change has been that Quantity Surveyors are now used much more in the "front-end" stages of projects where their expertise is of most value. Cost planning and budgeting is becoming the new "bread & butter" of the profession. One of the largest Quantity Surveying firms in Australia1 provides a good example of these changes; in 1980 Bills of Quantities accounted for approximately 80% of their total workload whereas in 2003 this had declined to less than 10%. However, rather than leading to the firm's demise, the firm has adapted accordingly and now provides a greater volume and wider range of services.

This section of the survey targeted the scope of services provided by firms. Figure 4 shows the percentage of firms providing traditional services (question not asked in 1995). Estimating/Cost Planning and Contract Administration are the main services provided by firms. Even though the use of Bills of Quantities has declined most firms still provide this service albeit to a limited extent. More firms prepare Builders Quantities than Bills of Quantities.

Figures 5 and 6 show the extent of non-traditional and non-building services provided by firms (question not asked in 1995). They provide a good indication of the great diversification in the scope of services provided by the profession. This scope is now clearly very broad with taxation advice (comprising mainly building Tax Depreciation Schedules) and valuations for insurance purposes the most common service.

The growth of the profession’s role in the provision of feasibility studies indicates the increasing awareness of introducing quantity surveyors at the outset of a project where they can be of most value. The 2003 results show that over 80% of firms now provide this service. Project management, value management and life cost analyses are now an integral service provided. The involvement in Facility Management and post occupancy services generally has grown and provides perhaps one of the greatest areas for long term growth. However, the 2003 results show a decline in the number of firms providing Facility Management services which is surprising. The role of Quantity Surveyors in resolving disputes as Expert Witnesses in Arbitration/Litigation actions has escalated markedly. Australia is one of the most litigious countries in the world (measured in terms of legal cases per capita) and its construction industry is dominated by a high level of dispute. Most disputes evolve around money so the cost expertise of the quantity surveyor is commonly sought.

Figure 6 shows that Quantity Surveying firms are venturing into non-building areas demonstrating that the cost management skills of the Quantity Surveyor can be applied in other industries just as is the case with Project Management. The 1998–2001 results indicated that this trend was likely to continue but the 2003 results saw a decline. The civil, infrastructure, transport and mining sectors are the main sources of non-building work.

However, the provision of these services does not necessarily mean that they account for a large proportion of a firm’s volume of work. Figures 7 and 8 indicate the percentage of income that these non-traditional/non-building services provide for firms. The results indicate a significant increase over the 9 year period. These results provide evidence that Quantity Surveying firms have really taken on the challenge of diversification to better meet and serve industry demands. This indicates, in part at least, a proactive approach to change by many firms. They also demonstrate the very broad range of employment and business opportunities available for the modern day quantity surveyor.

In 1995, non-traditional services accounted for less than 10% of total income for over 80% of firms and no firm had a percentage higher than 50%. Non-building services were very limited; only 10% of firms carried out these services and, even then, they only accounted for less than 10% of total income. From 1998-2001 this picture changed significantly and the 2003 results have shown an even greater increase in non-traditional building services. By 2003 non-traditional services accounted for more than 10% of total income for over 80% of firms and over 20% of total income for nearly half of firms. For approximately 20-25% of firms these services actually account for over 50% of total income.

Income from non-building services also showed substantial rises although this tapered back a bit with the 2003 results. In 1995 90% of firms did not generate any income from non-building services but by 2001/03 this figure had reduced to approximately 40%.

3.4 Computing systems

Operating Systems

In order to ascertain current processing technology capacity, respondents were asked to indicate their hardware platforms with the results shown in Figure 9. This provides the basis for the analysis of the IT survey results. The use of multi-user systems comprising a mainframe and dumb terminals has declined from around 40% of firms in 1995 to zero in 2003. The move to networked computers has been substantial and is to be expected. Over 70% of the 2003 respondents use networked systems which, given that the survey sample comprised over 40% of firms with 5 or less employees, indicates most firms use networking where practical. The use of laptop computers has remained relatively static being used by only approximately half of QS firms.

General Software Systems

Specialist Software Systems

Figure 11 indicates that although the majority of firms use specialist application industry software for estimating, cost planning and Bills of Quantities (BQ) preparation the same may not be said for other specialist areas such as facilities management. However, many firms have developed programs for these specialist areas in-house (largely based on spreadsheets) and many project management style programs provide "all-encompassing" capabilities. In-house software is now used by over half of firms. Of note is the marked increase in specialist feasibility software. The most alarming statistic however continues to be in relation to CAD software. In 1995 only 13% of respondents had CAD facilities. Over the ensuing 9 years this percentage has slowly increased to 28% which indicates that at least some firms are venturing into the CAD area. Nevertheless, this proportion is still low particularly if the profession is intent on remaining a key player in the project procurement cycle. Whilst some respondents cite cost as the main reason for the non-use of CAD, it is clear that the majority of Quantity Surveyors are resisting active involvement in the CAD area.

Electronic Communication

In terms of electronic communication, access to on-line services has improved as shown in Figure 12. As previously mentioned, in 1995 only 13% of firms had e-mail/internet facilities but by 2003 this figure has increased to 98%. In 1995 none of the respondent firms had web sites but by 2003 72% of firms had one. This figure is likely to have increased further by now. However, the use of on-line cost and product data services remains at a low level.

Figure 13 shows that the level of external electronic data exchange, other than by telephone or fax, has improved in the 2003 survey. The 1995-1999 surveys showed that less than 10% of firms transferred or received architectural drawings electronically but by 2003 this figure had risen dramatically in the past two years to 58%. Marked improvements were also evident with engineers’ and other consultants’ drawings.

However this level of transfer remains very limited. Figure 14 shows that, despite some improvements since 1995, over 40% of firms still do not transfer or receive any drawing documentation in an electronic form. However, some firms are clearly developing their capabilities in this area - the latest results show that approximately 17% receive/transfer over 20% of their drawing documentation electronically. These firms really stand out from the pack and clearly show that it is possible.

In terms of remote communications, the percentage of firms utilizing telecommuting by having at least one employee working has increased to about 25%. This is demonstrative of the benefits of telecommuting (at least in part) both for employers and employees. Teleconferencing facilities are now used by approximately 45% of firms. Only one firm (in the 2003 survey) had videoconferencing facilities.

Measurement Tools

The 1999 survey introduced a question relating to the use of electronic tools to aid the measurement process. The results in Figures 16 and 17 show that the majority of firms still cling to traditional paper-based measurement with the use of electronic measurement tools quite rare. The majority of respondent firms remain averse to using CAD automated quantities – in 1999 85% were not using CAD for this purpose and by 2003 this had only improved slightly to approximately 75%. In other words this indicates that three-quarters of the profession still do not use CAD at all for measurement. Nevertheless some firms have seen the potential with the 2003 results showing that approximately 10% of respondents use CAD often or daily for measurement.

However, it is not known whether this applies to all staff within these firms or just “selected”staff. These firms and others like them who did not respond to the survey, stand out as pioneers in this area. Given the low proportion of firms with CAD facilities in the first place, these results are probably not surprising. The major reasons cited for not using CAD are the cost involved in investing in the necessary hardware/software and training of staff, the incompatibility of different CAD systems and problems with the automated capabilities of these systems. Many firms stated that there was no need or requirement for them to measure with CAD. There are still many problems associated with using CAD for measurement and the time when CAD systems can automatically produce a detailed Bill of Quantities for projects generally (rather than being set up for specific projects) is still probably a long way off. But the reality is that most CAD systems have the capabilities to, at the very least, automatically generate basic quantities in terms of areas, volumes and numbers of items.

It was, however, encouraging to see a marked increase in the use of digitizers for measurement in the 2003 results. The use of digitizers for measurement has traditionally been very low in the profession. In 1999, 79% of firms never used digitizers, 13% seldom used them, 3% used them often and only 5% used them daily. These figures only improved marginally in 2001 but 2003 saw major increases to the point where nearly half of firms use digitizers often or on a daily basis. However, as with CAD measurement, it is not known whether these firms make digitizers available to all staff.

Nevertheless, the results indicate that the profession is generally not utilizing and evolving with systems that can automatically produce quantities. There is tremendous scope here for quantity surveying practices to improve productivity and cost efficiency by utilizing such systems.

3.5 Future expectations

The next section of the survey asked firms to give their opinions on a series of propositions relating to the possible future impact of general industry changes and Information Technology advances. The propositions and results are shown in Table 1. The predominant response for each year is highlighted in bold.

The predominant response categories were largely the same for each year and indicate that attitudes towards future directions in the industry, quantity surveying work practices and IT and their effect on the profession have remained relatively unchanged.

General Practice

1. The role of the QS as an independent consultant will expand in the future.

Approximately 80% of respondents in each survey agreed or strongly agreed with the above proposition. This reflects an optimism in the profession that hasn’t changed despite the many changes in the industry and the profession.

2. Future QSs will mainly be employed as part of a professional team in multi-disciplinary practices providing integrated "in-house" services.

This question concentrated on the future viability of the independent QS practice in light of changes in industry procurement practices which have seen many clients move to ‘design and construct” style single source procurement solutions. In 1995/98 60-70% disagreed with this whilst in 1999/2001 only about 50% disagreed. In 2003 75% disagreed which suggests that most practitioners do not believe that single source packaging of projects will have a detrimental impact on QS firms.

3. The QS will be a key player in the construction industry in 10 years time.

Once again the respondents generally responded very optimistically to this question with approximately 80% agreeing with this in the first four surveys. In 2003 90% agreed which perhaps reflects that, despite all of the rapid changes over the past decade, the skills and expertise of the QS are still in great demand.

Information Technology

4. The impact of IT on the construction industry will be minimal in the next 5 years.

The interesting result here was the decline in the 2003 survey of respondents who strongly disagreed with this proposition. In 1995 13% strongly disagreed but in 1998, 1999 and 2001 approximately 40% strongly disagreed. However, in 2003 only 19% strongly disagreed which may suggest that many practitioners feel that the effect of IT developments in the short term will not be as great as might be expected.

5. The impact of IT on the construction industry will be minimal in the next 10 years.

A similar pattern of responses was found with this question. In 1995 only 24% strongly disagreed with this but 1998-2001 saw approximately 50-60% strongly disagree. By 2003 this figure went back down to 27%.

6. Further advances in computing and IT generally will see the end of the technical QS measurer.

The responses to this question add further credence to the supposition that many in the profession do not see the impact of IT as being as great as first envisaged. In 1995 45% disagreed and in 1998-2001 approximately 60% disagreed. In 2003 this had increased to 74%. This clearly suggests that the majority of the profession believe that the problems (both current and future) with CAD generated quantities are so great that physical measurement will always be necessary at least in part.

7. IT advances will lead to fewer but more highly skilled QSs

Opinion was relatively divided on this matter in each of the surveys. The utilization of appropriate IT developments will increasingly enable quantity surveyors to provide more sophisticated professional services as many of the traditional QS tasks become automated. However, questions 1 and 3 showed that most respondents were very optimistic about the future demand for quantity surveyors. These factors may be the underlying reasons for the division of opinion.

8. CAD networking facilities and knowledge will be essential for the QS in 5 years time

Despite the survey findings of a low level of usage of CAD software, approximately 60-70% of respondents in each of the surveys agreed that CAD networking facilities and knowledge will be essential in 5 years time. It is clear however that nowhere near 60-70% of respondents are doing something about it. As shown earlier, the 2003 survey showed that only 28% of respondents had CAD software. Additionally, only 10% used CAD often or daily for measurement.

9. The QS profession should be actively involved in utilising, developing and promoting the use of CAD automated quantities

Approximately 65-75% of respondents in each of the surveys agreed that the profession should be actively involved in CAD development. However, with only 10% of firms in the 2003 survey using CAD regularly for measurement, it is clear that few firms are actually doing something. Nonetheless the author is aware of some firms who are very actively involved in this area and perhaps will provide the catalyst for other firms to follow suit.

10. Only larger practices have the resources to take advantage of IT

This proposition sought to determine whether smaller firms were at a disadvantage in terms of IT development. However, approximately 50-60% of respondents disagreed with this with approximately 10-15% unsure.

11. Greater use of IT will enable the QS profession to provide better service to clients

Approximately 75-85% of respondents in each of the surveys agreed with this. Nevertheless, the survey results show that many firms are not embracing many IT capabilities that might enable them to provide better services.

12. The QS is well placed to take advantage of the changes in the construction industry which will flow from the increased use of IT

Once again fairly consistent responses were received to this question in each of the surveys with approximately 65-75% agreeing. Given the low level of CAD usage indicated by the respondents, this view may be considered to be overly optimistic. The QS does have tremendous opportunities to be at the center of electronic information flow and management on projects but the survey results suggest that much more needs to be done if the profession is to embrace these opportunities. Whilst some firms are very progressive and active in this area, the profession is largely taking a reactive rather than proactive approach.

4. Future directions

The last section of the survey asked firms to indicate what they thought the major threats to the profession would be over the next five years and what directions their firm was planning to take to be in a position of strength over the same time frame. The following is a summary of the main comments from the 2003 survey.

Major threats

Fee Competition

Fee cutting and bidding amongst firms is seen as the major threat facing the profession by the majority of respondents. Changes to Australian trade practices legislation in the mid 1980s resulted in professional associations being unable to compel firms to adhere to published fee scales. This was classified as anticompetitive under the new legislation and enabled firms to undercut each other to procure work. This was followed by a major recession in the economy from approximately 1990 to 1994 where firms became desperate for work and were prepared to reduce their fees to often unsustainable levels. This was not peculiar to the quantity surveying profession and had a big impact on all consultancy practices in the industry. The hangover from this period remains as clients became used to paying lower fees. The design professions were particularly affected and this is reflected in the decline in the quality of documentation that respondents have identified in each of the surveys conducted. This has prompted firms to diversify and specialize to gain competitive advantage. From the IT perspective, many firms state that squeezed margins have prevented them from investing in IT research and development.

Professional Indemnity Insurance

Australia has one of the highest rates of litigation per capita in the world and in an industry such as construction it is not surprising that the level of legal action is rising rapidly. Combined with world events in recent years the whole insurance market in Australia is in upheaval. This has led to significant rises in Professional Indemnity Insurance premiums throughout the industry and quantity surveyors have not been spared. Despite being a relatively low risk compared to other professions in the industry, insurance premiums have increased anywhere from 100% to 800% for QS firms in the last few years. The quality and comprehensiveness of this insurance has at the same time declined. The number of insurers in this market has reduced from about ten to three or four.

CAD

The development of CAD and automatically generated quantities is seen by many firms as a major threat particularly in terms of the technical role of the quantity surveyor. However, the more enlightened firms believe that the greatest threat actually lies in not embracing CAD and CAD measurement and evolving with and being integrally involved in its development. The survey results clearly indicate that the vast majority of firms are clinging to traditional paper based measurement although the latest results do offer a glimmer of hope. It should also be remembered that not all firms responded to the surveys and the author is aware of a number of firms that are now utilizing this technology in a large way.

Conservatism/Inability to Change

Whilst the construction industry is generally conservative by nature, the survey results indicate that the quantity surveying profession is perhaps more conservative than most in terms of IT utilization. Many firms felt that the inability to change and re-engineer processes to take full advantage of technological advances was dragging the profession down. Some felt that directors of many firms lacked motivation to embark down this path due to a focus on short-term profits. Some respondents felt that this was particularly the case with some directors who were nearing retirement and were not prepared to take the plunge into IT development that would have longer term benefits. Some respondents felt that too many firms focused on the traditional technical role of the quantity surveyor and were not prepared or capable of raising their services to a higher and more professional value-adding level.

Other Professions

Firms clearly recognize the fact that project cost management is not the exclusive domain of the quantity surveying profession and that there are a number of other professionals carrying out this service and many others with the potential to do so. Project management and large accountancy firms were seen as the main threats. In fact, one respondent felt that the prospect of a large quantity surveying firm joining forces with a large international accountancy firm was not far away. The packaging of services under a “one-stop shop” approach and more “in-house” service provision by larger firms was also identified by many respondents. Perhaps the greatest threat in this respect lies with professionals more amenable to utilizing IT capabilities.

Poor Marketing

Being a relatively obscure profession in Australia, effective marketing is perhaps even more important than is the case with other professions. However, many firms felt that the profession as a whole was poorly marketed and that the piece-meal approaches adopted by individual firms were of no real benefit to the profession as a whole. A clear message coming though from the comments was that smaller firms felt that they needed more support from the Australian Institute of Quantity Surveying in marketing their services.

Quality of Graduates

Some respondents were dissatisfied with the quality of graduates from university courses particularly in terms of core skills in measurement and construction knowledge. Additionally, some firms have found that graduates are not interested in the technical measurement role. In the words of one director of a major QS firm, “they all want to be project managers”. Some respondents felt that core competencies and skills in the profession were declining generally. The extent of core quantity surveying curriculum in some university courses has declined in recent years as the pressures of major federal government changes to higher education impact on the manner in which some courses are delivered. Many courses also provide more generic and broad content to reflect the changing nature of the profession, particularly with respect to the rapid increase in the last decade in the type and scope of services provided. Another factor impinging on this area is the inability of many firms to provide “on-the-job” training to the levels experienced in years gone by. This has been largely brought about by the intense fee competition amongst firms and the concomitant squeeze on profit levels.

Lack of Interest from School Leavers

Perhaps the greatest problem facing the profession in Australia is the declining level of interest shown by school leavers in the profession. Of those that are interested many are not interested in the very technical aspects of the profession such as measurement preferring to be involved in some of the more “glamorous” services that firms now provide. This is despite the fact that measurement skills underpin most if not all services provided by quantity surveyors. A traditional path for quantity surveyors in Australia has been to undertake a university course part-time whilst employed as a cadet at a quantity surveying firm. However, the number of students studying part-time in this capacity has reduced significantly in the past decade. An example of the problem can be demonstrated by a major firm in Australia who in the past would employ 10-12 cadets at any one point in time. Towards the end of last year this had reduced to just one cadet with the firm experiencing particular problems in attracting first year cadets from school. Other firms have experienced similar problems. The marketing problems outlined earlier are clearly a factor here and the AIQS will introduce a concerted marketing campaign aimed at school leavers in 2004.

5. IT strategies for quantity surveying firms

The following strategies flow from the findings of the research underpinning this paper. These strategies are not intended to be exhaustive and do not provide detailed examples of how these strategies might be achieved. Rather they are aimed at providing "food for thought" for Quantity Surveying practitioners to assist in determining approaches that best suit their particular firm and circumstances.

5.1 Maintain and develop professional expertise in core competencies

First and foremost firms need to ensure that their quantity surveyors have sufficient professional expertise in the core competencies and skills of the profession and continue to develop this expertise. Adequate "on-the-job" training should be in place for inexperienced employees and to also complement tertiary education. Too much focus on the use of IT may lead to the deterioration of fundamental professional skills that will increasingly become necessary as technological advances continue to automate technical activities thus requiring practitioners to operate at a more highly skilled and professional level. The danger of inexperienced or incompetent staff utilising sophisticated but "user friendly" software is obvious. Nevertheless, practitioners need to be far more adaptable and willing to change their standard work practices than in the past.

5.2 Learn, utilize and evolve with CAD

There is no question, in the author's mind, that Quantity Surveying firms, and indeed all construction professionals, need to utilise and gain expertise in CAD sooner rather than later. CAD systems will be at the centre of future information management system and virtual projects and, consequently, professionals will need CAD capabilities and expertise just to be a player. Whilst 2D CAD currently predominates in the industry, the industry is moving towards 3D object oriented CAD and firms looking to the future will need to embrace this CAD format. 3D CAD also offers far more possible uses for the Quantity Surveyor. The most obvious benefit for Quantity Surveyors lies in the use of automated quantities with enormous productivity gains already possible. The preparation of quantities in the traditional paper-based mode is tedious and time-consuming and typically accounts for approximately 80% of the total time spent in preparing tenders, budgetary estimates and cost plans.

Rather than being a threat, automated quantities actually have the potential to provide tremendous opportunities for the profession. Removing much of the technical drudgery, albeit the traditional "bread and butter", of the profession will provide practitioners with more time to focus on developing sophisticated cost management systems and a wider range of value-added services. This will provide the potential for firms to be able to provide a wider range of value-added services on a larger number of projects. The important thing is not who or what prepares the quantities (as long as they are accurate) but more what is done with the quantities. Many practitioners are skeptical, with good reason, about the automated quantities capabilities of CAD systems. There are still many problems with utilizing commercial "off the shelf" CAD software to generate quantities. However, these problems are being overcome and most programs, at the very least, are capable of generating basic lineal, area and volume measurements with most now able to produce quite detailed item quantities. Hence, it is possible now for practitioners to extract a large proportion of a project's quantities from automatically generated quantities in spreadsheet formats which can be linked directly to most estimating/measurement programs.

5.3 Invest in necessary technology

Many firms cite cost and the time required to learn CAD and other software/technology as the main inhibitors to investment in the IT area. However, the greatest cost for employers usually lies in their actual workforce. The average annual salary of a qualified Quantity Surveyor in Australia is approximately $70,000 per annum which equates to approximately $90,000 when salary loadings are taken into account. CAD software and the necessary hardware can be purchased for $6000-$10,000 for one licence with this figure decreasing for additional licences. Whilst time and money must be spent learning how to use these systems, the technology costs are actually relatively low when compared to salary costs. When one considers the potential productivity improvements the cost of investment in CAD may not only be negligible but may not be a cost at all in the long term due to the enhanced profitability of the firm's operations. Looking at the broader picture, CAD capabilities and expertise will more than likely result in increased business opportunities.

5.4 Diversification / specialization of services

The survey results outlined earlier indicate that Quantity Surveying firms are diversifying their scope of services to better meet industry/client demands and to secure their long term future. This diversification is seen by many as critical to the future of the profession as a whole. The survey results show that the proportion of income obtained from non-traditional and non-building work has risen markedly in the past 9 years. Facility Management and Ecological Sustainable Development (ESD) represent two huge new growth areas for the profession in terms of new services. The financial management skills of the Quantity Surveyor can be applied in many different areas both within and outside the property industry and many firms are beginning to realize the opportunities that this creates.

5.5 Multi-skilled team

Such diversification and specialisation will require firms to have employees (or consultants) with a very broad range of skills, expertise and professional training. Diversification represents considerable risk for firms without the necessary skill and expertise to carry out the new services. Accordingly, many Quantity Surveying firms are now employing construction professionals from a variety of “non-QS” backgrounds to augment their services. A multi-skilled and qualified workforce will also provide firms with greater opportunities to expand their scope of services.

5.6 Continuing Professional Development

Continuing Professional Development (CPD) is a requirement for members of most professional associations and the construction industry is no exception. Rather than relying solely on their employers, practitioners need to also take responsibility for their own professional development. IT is a classic area for CPD due to the regularity and speed of change and such personal development can significantly enhance an individual’s value to a firm.

6. Conclusion

Continuing industry change and technological developments will present the profession with many challenges, threats and opportunities. Whatever direction the profession takes, the financial management expertise of the Quantity Surveyor will remain in demand. The uncertainty really lies in what capacity and for whom the Quantity Surveyor will be working and whether the individual independent Quantity Surveying firm will continue to exist in its current form. It is clear that computing and information management expertise will be a necessary component in the tool kit of the future Quantity Surveyor. Diversification and specialization appears set to continue and expand as quantity surveyors continue to explore new markets and niches for competitive advantage.

Despite speculation about the future of the profession, the survey responses consistently demonstrated optimism for the future by quantity surveying firms. At this point in time quantity surveyors are in strong demand and the Australian government has identified a shortage of quantity surveying professionals throughout the country. Many firms are struggling to employ quality cadets, graduates and experienced personnel to enable them to meet their demands. Whilst this may simply be a result of the sustained boom in the industry over the past five years, it is clear that the need for effective financial management of projects will always be necessary. It is to be hoped that quantity surveyors will continue to be a key player in this area.

Acknowledgements

The author would like to thank his colleagues in the Project Management Department at the University of Technology Sydney (namely Rick Best and Gerard DeValence) for their assistance with the research connected with this paper.

Acknowledgements

Hutt, R. (2000), Managing, Motivating and Training in the Information Age, Construction IT 2000 Conference, April, Sydney

Smith, P. (2001), Information Technology and the QS Practice, The Australian Journal of Construction Economics and Building, Volume 1, Issue 1, August

Smith, P. (2002), The Utilisation of Information Technology by the Australian Quantity Surveying Profession, 3rd World Congress on Cost Engineering, Project Management and Quantity Surveying, ICEC, Melbourne, Australia, April

1. The identity of this firm is not disclosed for reasons of confidentiality.

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Dr Chandika Diran Wickramatillake

Abstract

A large scale project requires several sub-level time plans to be managed effectively, in order to control costs and achieve delivery targets. Although various planning tools exist for project scheduling, there is still an opportunity to improve on the methods used for successful project plan co-ordination; particularly when there are many large independent execution team plans which report to the master schedule. In such instances, even where a project-wide work breakdown structure is used to roll-up and report progress, critical path analysis becomes inaccurate as the complicated logic in sub-level plans are not reflected within the Master schedule. The main effort of this work is to discuss issues relating to multi-plan management methods, in a view to improve project co-ordination. Methods of controlling deliverables between the master schedule, group plans and team execution plans are reported. The work here relates to practical issues which are being faced during the construction of the complex £200 million London Heathrow Airport Terminal 5 Baggage Handling System project.

Keywords: planning, co-ordination, multi-plan

1. Introduction

Large projects are increasingly using sub-level time plans to support the delivery of large quantities of work. These plans typically consist of level 2 and level 3 sub-plans, and contain logic and resources to achieve deliverable targets and milestones of the high-level level 1 programme. Demanding development projects which have large budgets, many milestones and complicated logic may use up to level 4, 5 or 6 detailed task team execution plans to support, co-ordinate and control the project. This type of detailed planning is becoming popular in projects with reimbursable contracts where customers demand detailed justification of actual costs and achievements, to monitor performance and project progress.

Although a good project wide work breakdown structure may be in place to capture costs, resources and progress, in instances where detailed level 4,5 and 6 sub-planning is used, the logic and critical path analysis becomes extremely difficult to manage [1]. The main reason, these plans are being maintained independently to the master schedule, to manage frequent changes to logic and resource allocations due to ongoing development of the system and processes, and the lack of resources to update detailed logic in the master programme. An additional drawback of having such detail independent plans include many problems in co-ordinating deliverables among the detail plans to achieve milestone in level 2 and 3 sub-level plans [2].

The objective of this paper is to discuss issues relating to multi-plan management methods and to provide a possible solution of using ‘Integration’ tasks throughout the project phases, in an attempt to assist project managers and engineers to manage their projects effectively.

2. Multi-plan management

A detailed multi-plan consists of a series of logically linked activities to reach a milestone. These activities are controlled by a start milestone and finish milestone. They support a summary or a rolled-up deliverable of a sub-level 2 or 3 plan. The requirement for independent detail multi-plans, along with their drawbacks are outlined below in Table 1.

The maintenance of multi-plans require many rules to be followed to report issues and monthly progress to higher level of planning. In addition, they also require stringent procedures and continuous monitoring of change to identify status with progress and revised completion dates. These problems, along with those identified as drawbacks in Table 1, may be resolved with the introduction of ‘Integration’ tasks. These integration activities not only manage the reporting to sub-level plans, but also provides intermediate integration milestones which are weighted to form part of a project deliverable or sub-level target. The milestones also provide an accurate method of measuring progress at detail level which then in turn can be rolled-up to reflect achievement within the master programme.

3. Introduction of Integration Teams to manage multi-plans

A proposed method for using multi-plans considers the master plan and independent plans managed as outlined in Figure 1. Here, the intermediate and deliverable milestones within the integration tasks of the plans bring together the logic behind the sub-plans of the master programme and independent detail plans. The integration plan provides a substantial importance in identified the critical path, as it regularly aligns deliverable milestones with sub-plan milestones. In addition, frequent changes to the baseline, mainly due to changes in customer requirements in levels 4,5 and 6, are accommodated with minimal consequences to the level 2 and 3 planning. This process not only retains the overall master programme’s logic and baseline in the long term, but also reduces the complexity and effort to manage the project.

4. Multi-plan Resources

It is important to have a robust cost based resources planning system to manage the budgets and resources of multi-plans and the master programme. The initial set-up of this system should consider breakdown structure, cost capture, progress monitoring and reporting criteria. Allocation of financial budgets and man-hour resources to multi-plans should be similar to that of standard projects. However, the total number of hours and budgets of multi-plan work packages at deliverable level should be identical to the allocated resource of the summary bar of the level 2 or 3 sub-level planning. Forecasting of completion dates of level 2 and 3 summary plans should also cover the completion dates of the detail plans. This ensures detail plan budgets are open to handle re-work or re-development until the completion of the work phase. Due to this reason, schedule performance calculations of detail multi-plans compared with master programme will be inaccurate; and thus should only be carried out at master programme level. However, the cost performance calculations throughout all plans and the master programme will be correct.

5. Implementing multi-plans in large projects

Multi-plans are mainly used to administer a large volume of work needing careful management. These plans must be introduced in conjunction with standard project management techniques [4]. Project managers, co-ordinators, planners and engineers should decide on the feasibility of implementing multi-plans. A thorough study must be undertaken to prioritise requirements and assess compatibility with in-house and client based systems. Accurate change control procedures should also be in place to ensure movement of budgets and resources are reflected in baseline activities.

Due to the nature of these multi-plans, gradual implementation is possible. Thus, introduction of detail-multi plans should consider those work packages requiring stringent management due to high risks. The gradual approach of detailing a level 2 or 3 sub-level summary plan with a multi-plan would benefit the project team with an opportunity to progressively move to full implementation. Particular consideration must also be given for budget and human resource organising, to update and keep alignment while introducing multi-plans, to prevent misinterpretation of project progress and performance.

6. Conclusion

This paper encourages senior engineers and managers to use multi-plans to improve the management of large projects. Multi-plans are ideal for work packages with many development based detailed activities. Even though there are many advantages of using multi-plans to manage the volume of deliverables, there is a considerable amount if risk involved in employing such a system for live projects. A gradual phased approach has to be employed for successful implementation. However, the use of Integration tasks not only eases the complexity of managing many deliverables, but also provides a good reporting and progress measuring methodology to satisfy customers to meet their targets. Further studies of using Integration tasks with multi-plans have to be conducted to develop a standard method which could be used to manage large complicated projects.

7. References

[1] Elonen A and Artto K A, Problems in managing internal development projects in multi-project environments, International Journal of Project Management, Vol. 21, 2003, pp. 395-402

[2] Blisma N G, Sher W D, Thorpe A and Baldwin A N, Factors influencing project delivery within construction clients’ multi-project environments, Engineering, Construction and Architectural Management, Vol. 11, No. 2, 2004, pp. 113-125

[3] Branconi C V and Loch C H, Contracting for major projects: eight business levers for top management, International Journal of Project Management, Vol. 22, 2004, pp. 119-130

[4] Lycett M, Rassau A and Danson J, Programme Management: a critical review, International Journal of Project Management, Vol. 22, 2004, pp. 289-299

Contact details

Address: BAA T5 Project Team, Vanderlande Industries Ltd., P O Box 620, 420 Bath Road, Longford, West Dayton, Middlesex, UB7 0NX, United Kingdom

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A discussion paper

Professor Yin Yi-lin

Abstract

The following paper is based on a presentation given by Professor Yin Yi-Lin on the cost engineering profession and cost engineering education in Mainland China. It is a fascinating account of the development of our profession in the largest country in the world and outlines ways in which organisations like PAQS can assist in this development. A strong quantity surveying/cost engineering profession in China will further enhance our professional status on a global scale.

Introduction

This paper examines the development of construction cost management in Mainland China. The current market situation is explored and the development of higher education in cost engineering is explained. This includes the development of cost engineering university courses and the certification process for the accreditation of cost engineers. The role of CECA’s Education Board and the accreditation examination entry requirements are also explained. The paper concludes with suggestions on how PAQS, the RICS and other professional cost management associations can assist with the evolution of the profession in this country.

Historical background

Under the planned economy policy, construction cost management in Mainland China was based on the use of the “constants” approach (i.e. constant labour and material contents, unit rates, wastage, management fees. etc.). These constants were not revised frequently. Project estimates prepared at the project planning stage were the key references for construction cost management. The benefits of utilising the input of different parties and professionals early in the development stages of a project were not generally recognised.

Between 1950-1980 project prices were planned by the government and were based on the Soviet Union’s system of construction “constants”. Reformation of construction cost management began during the period 1980-1990. Whilst project prices were still established by the government, the use of the competitive tendering system was explored and began to be used.

From 1990 onwards project prices were determined by the market. To enhance the cost management reformation, Bills of Quantities were introduced into tender documents by the Government from 1 July 2003. The government is now investigating the use of an effective whole-process cost management approach.

Current market situation

The market demand for construction cost professionals continues to surge. The value of construction works in China rises continuously. By 2010, it is estimated to be more than RMB 1,200 billion. The demand on construction cost professionals is therefore great and urgent.

The total number of people working in the cost engineering field in China is now approximately 1,200,000. The current total number of qualified cost engineers is over 60,000, increasing at the annual rate of about 7,000.

Cost engineering firms / associations

Cost engineering consultant firms are divided into two categories and the current total number of firms is about 5,000.

The scope of services carried out includes feasibility studies, designs, cost estimates, tendering and bidding, works supervision and final accounts. They are governed by different government departments with their own codes and requirements, which may not be inter-related or match with one another.

Most of the professional associations cannot yet play an important role in helping to govern the industry. They are still in a developing stage and mainly carry out academic research and related activities.

The government treats the monitoring of the qualifications of consulting firms as the first priority, with the monitoring of the qualifications of individual professionals as the second.

The Education Board of the China Engineering Cost Association (CECA)

The terms of reference for the Education Board of CECA are to:

• Prepare development strategies for higher education in cost engineering.
• Establish national assessment standards for higher education in cost engineering.
• Establish the framework for the provision of CPDs to qualified cost engineers.
• Support and co-ordinate research on higher education in cost engineering and provide guidance in compiling teaching materials.
• Co-operate and exchange experience with relevant international organizations on the advancement of higher education in cost engineering.

Membership of the Board has a total of 66 members including:

• Experts from private consulting firms;
• Experienced senior members in the cost engineering profession;
• Government officials; and
• Scholars from universities all over the country.

Cost Engineer Accreditation Examinations

The entry requirements for the qualified cost engineers examination are as follows:

The contents of the examination cover the basic knowledge and skills required from construction cost engineers, and include construction technology, economics, management, law and case analyses.

Registration of qualified cost engineers is by the Ministry of Construction and its construction administration departments in each Province. Candidates who pass the examination should go to the related department and register within 3 months. The validity period of the registration is 2 years. Re-registration should be done within 3 months before the validity period expires. Before re-registration, the cost engineer should undertake further continual education and professional training certification.

The development of Higher Education in Cost Engineering

In the 1990s, with rapid economic growth, the construction industry became important to the GDP and more and more universities set up different departments in fields such as international project management, real estate operations and management, and the like. In 1998, the Ministry of Education consolidated the various fields and set up the field of Engineering Management. Construction cost management became a branch of this new Engineering Management field.

In 2002, the first ‘cost engineering’ course was introduced at my University (Tianjin Technology University) and was approved by the Ministry of Education. Then about 70 students enrolled leading to a bachelor degree in September 2003.

By the end of 2003, there were about 150 universities providing bachelor degree courses in Engineering Management and among them about 50 universities provided bachelor degree courses in cost engineering. The total number of new intake students who major in the bachelor degree of cost engineering is about 10,000 every year. However, there are a number of problems with this higher education in Cost Engineering. Firstly, there is no accreditation system for university cost engineering courses.

Secondly, there is a shortage of good textbooks. One reason is that the cost engineering courses in the various universities are different and the emphasis is also different. For example, some universities emphasize an engineering background and their courses are based on construction science and technology, while others emphasize the systematic integration of economics, management, law, and construction technology.

Another problem is the difficulties in providing effective Continuing Professional Development programs to the large number of qualified cost engineers.

Future plans

Plans are in place for institutes/universities providing these courses to be accredited by CECA. The academic qualification requirements for qualified cost engineers will be either a pure engineering qualification or a cost engineering qualification, but both have to be obtained from institutes accredited by CECA. Cost engineering programs will however be affected by criteria set by the Ministry of Education, with the relevant professional associations not being consulted beforehand.

The cost engineering profession is regarded as an applied science. The majority of cost engineers will not therefore come from traditional academic universities that put more emphasis on academic research and offer masters and doctoral degree courses.

Potential for collaboration

CECA are currently drafting the policy and procedures for accrediting cost engineering degree courses in Mainland China. They are seeking the assistance of PAQS, the RICS, universities and other relevant associations to help with this process. Other areas where these associations/universities can help is with Continuing Professional Development programs, joint research work in the area of higher education and the development of good teaching materials.

Contact details

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13-16 November 2005, New Delhi, India

• Biggest IPMA World Congress on project management
• Supported by 33 industry associations of India, 6 overseas partner associations
• 4 Govt. Ministries of India
• Supported by 33 countries of IPMA
• Supported by ICEC having 46 member societies in the world.
• 4 major stream and 25 sections
• Quantity surveying one of the key stream

DON’T MISS………………. this great opportunity of learning and NETWORKING

19th IPMA World Congress on Project Management, Theme: “Vision To Reality – the project management way, 13-16 November 2005 is being organized in New Delhi, India. The above congress is the biggest and most prestigious World Congress in Europe on project management and will be held outside Europe for the first time in the last 40 years. The congress is being organized by Project Management Associates (PMA), the national PM association of India jointly with Center for Excellence in Project Management (CEPM) and IPMA.

This World Congress has already generated tremendous response all over the world. 33 industry associations of India including Confederation of Indian Industry (CII) and 4 Govt. Ministries are supporting the event as Associates and Supporters. Six international associations having presence in several countries like ICEC and PMCC, PMRC, ENNA of Japan, CIOB of UK, AIPM (Australia) are supporting the Congress as Partner Associations. Thus above World Congress has largest number of Supporters, Associates, and Partner Associations from overseas ever gathered together for any event in the world. We also expect about 5-6 European countries as Partner Countries to join soon. The promotion of the Congress is being carried out by all the associating organizations worldwide.

The IPMA World Congress is poised to create history and its success is ensured. Top-notch professionals, CEO’s, heads of governments, academicians, NGO’s, project consultants, trainers, universities offering PM courses, development planners, VC’s, entrepreneur’s top Govt officials and business community from all over the world will attend the congress. It is a golden opportunity for all those who are interested in learning the global trends in managing projects in diverse field all over the world to not to miss this opportunity. Best companies in the world are going to participate in the Congress and present their case studies.

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