Construction Joint Ventures Research Articles

RSIAM risk profile for managing risk factors of international construction joint ventures

The international construction joint venture (ICJV) has been adopted in the global construction industry. However, it is extremely risky due to the size, complexity, and multifaceted operations of ICJV projects. Although there were many studies focusing on the risks in the ICJV, none of them examined simultaneously the chain of risk factors, risk sources, as well as the impact spectrum of risk factors, risk assessment, and risk response measures. The objective of this study is to establish a RSIAM profile, which stands for risk factors (R), risk sources (S), impact spectrum of risk factors on ICJV project objectives (I), risk assessment in different stages (A), and risk response measures for the implementation of ICJV projects (M). In this study, the risk factors were identified based on previous studies and pilot tests with 8 experienced professionals. Structured interviews with 15 experienced professionals were conducted to identify the risk sources and the impact spectrum of risk factors, to assess the likelihood of occurrence and the impact of each risk factor, as well as to compile risk response methods and measures. The results from the interviews were then used to build the RSIAM risk profile for ICJV projects. The RSIAM risk profile can assist practitioners to manage all risk factors in every stage of ICJV projects systematically and efficiently.

Management control structures and performance implications in international construction joint ventures: critical survey and conceptual framework

PurposeManagement control is needed in international joint ventures (IJVs) for successful management and performance. While IJV management control and performance concept has been widely explored, in the construction sector, the core understanding of the design of the two concepts is still lacking. This has resulted in the neglect of important questions and directions for research and practice improvement. This study aims to conduct a critical survey of prior studies addressing the conceptualization of management control and performance in IJVs and to propose a framework for studying the performance implications of management control in international construction joint ventures (ICJVs).Design/methodology/approachUsing Scopus database and search terms, a systematic desktop search was conducted to retrieve empirically related peer-reviewed papers for this study.FindingsDrawing on the transaction cost, institutional and relational logic, the first inclusive hypothetical model for studying the relationship between different dimensions of management control mechanism and multiple performance criteria in ICJVs is presented. The model proposes a measurement method for both the management control and performance and explains how they can be established in ICJVs.Practical implicationsThe proposed framework provides a methodology to understand the dynamics of management control and performance implications in ICJV. Specifically, uncovering the critical paths will assist ICJV frontliners to approach management control in a more holistic and systematic way to promote achievement of ICJV goals.Originality/valueThe study gives a firm ground to the construction industry, which is accurate and educational for related fields concentrating on several other forms of cooperative relationships.

Conceptual Profit Allocation Framework for Construction Joint Ventures: Shapley Value Approach

Construction joint ventures (CJVs) execute business by pooling diverse technical and financial contributions from collaborating entities. Traditional CJV profit-allocation approaches account only for investment shares, and do not address the marginal contribution of the participating parties. Therefore, disagreements may arise between stakeholders. This research aims to reduce profit-share-related disagreements among multiple CJV members by allocating profit based on the marginal contribution of each party. The authors developed a conceptual framework using the Shapley value as an alternative to the traditional investment-based approach. Three illustrative examples demonstrated the possible use of the developed conceptual framework. Results of the study highlighted the potential of Shapley value as an alternative profit allocation scheme. The stability of the generated results was validated mathematically, and decision makers’ perception of fairness was addressed following the methods of prior experimental cooperative game theory research. This paper contributes to the body of knowledge by proposing an axiomatically fair methodology for profit-sharing negotiations among multiple collaborating parties in a project. This approach can be utilized in other engineering domains where the management needs to foster stable and fair collaborations among its stakeholders.

Designing a state‐of‐the‐art monitoring system in challenging operating conditions

AbstractThe construction joint venture NouvLR is constructing the new light rail network in Montreal. One of the major challenges is the advance below the existing runways and taxiways of the Montreal‐Trudeau International airport and the construction of the subway station below the airport. The airport must remain under operation during the construction, and very tight requirements have been imposed regarding the tolerable surface settlements and availability of the monitoring data. The regulations regarding operations of the airport and possible presence of foreign objects in vicinity of its runways and taxiways represent an additional challenge, requiring usage of less straightforward monitoring concepts. The works for the installation of the monitoring equipment must be closely coordinated with airport operations and require a reliable schedule.The final geotechnical monitoring design has been performed in close cooperation with the contractor and in tight coordination with the airport authority. In order to allow more straightforward communication, 3D modelling and BIM‐methodology have been used to clearly represent the monitoring equipment, as well as the works required for their installation. The line‐of‐sight considerations in case of tachymeter measurements have been thus directly incorporated and dealt with. The monitoring design has to fulfil the aims of real‐time monitoring of the system behaviour during the construction and the long‐term monitoring of the newly built tunnel, demonstrating the compliance of the structure with the design. The paper is concluded by a summary of ”lessons learned“ regarding the issues of adverse accessibility and a challenging, high risk general environment.

国際建設合弁事業の成功・失敗要因に関する研究‐レビュー論文

国際建設合弁事業の成功・失敗要因に関する研究‐レビュー論文

Defining international construction joint ventures from the Wittgenstein family-resemblance theory

Defining international construction joint ventures from the Wittgenstein family-resemblance theory

Factors affecting international construction joint ventures: a systematic literature review

International construction joint ventures (ICJVs) have become an important way of exploiting business opportunities for construction companies worldwide. Yet, several barriers and risk factors contribute to their failure. This study aims to identify the barrier and risk factors affecting ICJVs through the lens of a systematic review methodology. Findings from 43 peer-reviewed articles showed an increasing publication trend for the past three decades (1990–2020). The bulk of the studies were conducted in Asia and Europe, particularly China and the UK, respectively. Overall, 37 barrier factors were identified, and these fall into six categories, namely, inter-organizational differences, lack of expertise and confidence, lack of effective planning and strategies, lack of knowledge of ICJV’s fundamentals, conflicts, and management difficulties. Next, 53 risk factors were identified and grouped into six, namely, policy and political risks, legal risks, financial risks, management risks, project and technical risks, and market risks. More importantly, knowledge gaps in existing studies are highlighted and future research directions are then proposed. The list of failure factors creates a valuable frame of reference for researchers and practitioners to develop more reliable, comprehensive, and proactive management strategies for ICJVs.

Incentives and contract design for knowledge sharing in construction joint ventures

Employing the differential game theory, this study proposes the dynamic incentive model for knowledge sharing in Design-Build joint ventures (DBJVs) under three types of contracts: no cost-sharing contract (NCSC), cost-sharing contract (CSC) and centralized decision-making contract (CDMC). The analytic model and numerical analysis approach are used to compare solutions in the three scenarios. The results indicate that the optimal amount of shared knowledge and the optimal payoff under the CDMC are both the highest. Besides, the leader will offer part of the knowledge sharing cost for the follower if the leader gets more than one-third payoff of the system. Compared with the NCSC, the system payoff under the CSC increases greatly, which is much larger than the payoff increment from the CSC to the CDMC. Furthermore, empirical evidence on major findings are provided. This research contributes to the literature on knowledge sharing in joint ventures.

Simulation analysis of incentives on employees' acceptance of foreign joint venture management practices: a case study

PurposeCultural differences between employees of different nationalities are hindering the development of some transnational joint ventures. Describing and modelling the positive (or negative) factors that cause joint venture employees to accept (or reject) joint management business practices is of great value to all corporations operating abroad with locally sourced employees.Design/methodology/approachThis study uses a Sino-Japan construction joint venture project as a representative case study. First, structural equation modelling is used to identify the factors influencing Chinese employees' acceptance of joint venture management practices. Then, a system dynamics model is adopted to simulate the time-dependent effects of the incentives.FindingsThe study results (1) indicate which incentives strongly affect employee acceptance of joint venture management practices; (2) identify inefficient management practices in cross-cultural joint ventures; and (3) provide evidence that the employees' perceptions of clear purpose, good working relationships and helpful mechanisms positively and directly also support their acceptance of joint management practices.Originality/value–A dynamic simulation method is used to analyse the influence of various incentive factors on employee acceptance of joint management. This provides unprecedented information regarding how these factors interact with each other, hence how their effectiveness varies (both positively and negatively) over time. Further findings also provide new ideas for joint venture managers to adopt more effective management methods.

Impact of culture differences on performance of international construction joint ventures: the moderating role of conflict management

PurposeCultural differences have been frequently cited as a major source of risks for international joint ventures (IJVs). Cultural differences may cause extensive conflicts in technology, norms and emotion among the international joint venture (IJV) partners. The purpose of this study is to explore the interactive effects of national culture differences (NCDs) and conflict management approaches on the performance of international construction joint ventures (ICJV).Design/methodology/approachData were collected using a questionnaire survey method with 143 valid responses. Partial least squares structural equation modeling (PLS-SEM) was used to test the research hypotheses.FindingsIt was found that ICJV performance declined with a high degree of NCDs. The negative effect of NCDs on ICJV performance was mitigated by adopting the cooperative conflict management approach; while it was aggravated by adopting the competitive conflict management approach. The findings may provide an alternative way (i.e. adopting the cooperative conflict management approach rather than avoiding or competitive approaches) to address the cultural conflicts in the multicultural project management teams.Practical implicationsFirstly, as NCD negatively impacts performance of ICJVs, project managers should pay attention to cultural issues and learn how to manage them; Secondly, as cooperative and competitive conflict management approaches have different moderating effects on the relationship between NCD and ICJV performance, project managers must choose appropriate conflict management styles in multination teams. Thirdly, as the avoiding approach has no significant moderating effect on the negative relationship between NCD and ICJV performance, it is important for Chinese partners not to employ avoiding approach to deal with conflicts in ICJV.Originality/valueThis study uniquely adds to the literature on cultural issues in managing ICJVs by integrating the moderating effects of conflict management approaches. The interactive effects of conflict management approaches and national cultural differences on ICJV project performance may contribute to the theories regarding conflict management theory in the context of cross-cultural management.

Drivers for international construction joint ventures adoption: a systematic literature review

Recognizing that there exist discrete sets of factors driving the adoption of international construction joint ventures (ICJVs) for different countries, organizations, and stakeholders, this study aims to identify the driving factors, and integrate them into a classification framework for better understanding. The Virtual Libraries (VLs) of respective journals were accessed directly to retrieve the related papers for the study. Popular search engines such as Google Scholar, the Web of Science, and Engineering Village were also used to complement the search process. From the review, universal drivers that promote the adoption of ICJV have been identified for policymakers and stakeholders’ realization. The UK, Australia, Singapore, Turkey, and China have been the top countries noted for pioneering ICJV drivers’ research. While the bulk of studies has come from developed countries, developing countries have also made a significant contribution. A conceptual framework has been developed to guide, determine, and assess the success of ICJVs based on 47 identified drivers. The framework consists of five major constructs of ICJV drivers: legal and market-driven drivers, strategic vision drivers, organizational and personal goal drivers, relationship building and operational success drivers, and capacity building drivers. These drivers act as a blueprint for the parties to the venture and could be used to determine the success and failure dynamics of ICJVs. The developed framework serves as a guide for all industry practitioners and decision-makers interested in adopting an ICJV. Further, it can facilitate the development of appropriate and effective policies by government agencies to promote the adoption of ICJVs. Moreover, the checklist and framework provide a strong foundation for researchers to conduct a further empirical investigation on the topic.

Empirical Study on the Obstacles to the Success of Joint Ventures in Construction Projects

As an effective way of completing technically complex buildings or large‐scale infrastructure projects, a joint venture contracting approach has recently been widely used in the construction industry. However, numerous unfavorable results can occur in practice when undertaking construction joint ventures (CJVs). The contribution of this paper is its exploration of the potential obstacles to CJV practices and identification of the root causes of failure. First, through a literature review, semistructured interviews, and a questionnaire survey, seventeen variables were identified; the top three obstacle variables were (1) inconsistent management styles, (2) incompatible organizational cultures, and (3) organizational policy differences. Second, four grouped factors were extracted: (1) unfair and noneffective management; (2) lack of communication, understanding, and mutual trust; (3) policy, management style, and organizational cultural differences; and (4) potential conflicts beyond the CJV partnership. Finally, several strategies were proposed. The research findings could not only contribute to knowledge of CJVs but also provide valuable insights into promoting broader, better applications of CJV projects and contributing to their success.

Knowledge Creation: A Case Study of International Construction Joint Venture Projects in Thailand

Knowledge Creation: A Case Study of International Construction Joint Venture Projects in Thailand

Review of Concepts and Trends in International Construction Joint Ventures Research

AbstractThe adoption of international construction joint ventures (ICJVs) of late for more complex and large-scale construction projects across the globe has drawn an increasing broad range of rese...

Combining process analysis method and four-pronged approach to integrate corporate sustainability metrics for assessing international construction joint ventures performance

Abstract While the number of publications on international construction joint ventures (ICJVs) performance assessment has gained attention, yet it suffers from the lack of complete and standardized appraisal. The incomplete ICJV performance metrics and the neglection of corporate sustainability (CS) performance indicators in the ICJVs performance assessment are the prime reasons for its inadequacy. This paper systematically reviews the literature on ICJVs performance measurement and integrates CS indicators into ICJV performance assessment using a hybrid technique, fusing process analysis method and four-pronged approach. Based on 86 articles retrieved from Scopus and the Web of Science, the results point out that while traditional economic indicators account for more than half of the extracted indicators, environmental and social indicators have been partially considered in ICJVs performance measurement. Moving forward, organizations have embraced the CS agenda, and its integration into businesses has been intensively present. In this study, 36 performance indicators were identified and categorized into five major constructs, namely: project-based performance, company/partner performance, perceived satisfaction, performance of the ICJV management, and socio-environmental performance. The novel contributions include updating and aggregating the discrete ICJVs performance metrics and introducing a new dimension of performance assessment into ICJVs. This study offers potential avenues for future research by triggering a shift from the confined economic and incomplete ICJV performance appraisal to a more complete and standardized performance evaluation. Consequently, managers and practitioners can use the novel framework for assessing their performance and reporting purposes. This study can contribute to global sustainable development and corporate competitive advantage. Lastly, this study enriches both ICJV performance and sustainability literature by providing a systematic review of extant literature.

Beyond national culture difference

PurposeInternational construction joint ventures (ICJVs) have been widely used as a temporary arrangement in many projects all over the world, especially in megaprojects. Within ICJVs, the national culture difference between partners affects their cooperation significantly. However, prior research has provided contradictory empirical evidence regarding these impacts. To address this problem, the purpose of this paper is to introduce cultural intelligence that judges an individual’s capability to function and manage effectively in culturally diverse settings as a moderating variable.Design/methodology/approachMultiple regression analysis and moderated multiple regression were undertaken to test proposed hypotheses. A questionnaire survey was conducted with international construction practitioners who had experiences of managing or participating in ICJVs.FindingsThe result of multiple regression analysis revealed that difference in national culture has significant negative effects on information exchange, shared problem solving and flexibility when asking for changes, thus effecting cooperation within ICJVs. Meanwhile, cultural intelligence of members can weaken these negative influences.Practical implicationsFirst, given that national culture difference affects negatively on the cooperation within ICJVs, it needs to be regarded as one of vital resources of risk which should be prevented and managed when attending ICJVs; Second, managers should build a series of mutually agreeable regulations and rules to lessen the negative effect of national culture difference; Third, it is recommended that ICJV management teams contain as many work-experienced members as possible and members within ICJVs, especially new staff, receive cross-cultural training termly to facilitate the cooperation between partners.Originality/valueThis research reveals the moderating effects of cultural intelligence on the relationship between national culture difference and cooperation in ICJVs as well as provides practical implications for ICJV managers to deal with national culture difference and reduce its negative impact on cooperation within ICJVs.

Knowledge-Transfer Enablers for Successful Construction Joint Ventures

International joint ventures (IJVs) are formed to address skills and knowledge deficiencies in executing complex construction projects. Despite many configurations of IJVs, there is still a heavy reliance on overseas expertise due to a limited understanding of the significant factors affecting the acquisition of vital managerial knowledge from the IJV’s foreign partner. Using factor and regression analyses, this paper investigates the critical variables for ensuring that there is a transfer of the required expertise in IJVs. An evaluation of 41 companies involved in IJVs produced 6 factors affecting the acquisition of knowledge; these are conflict and trust, intent to learn, interaction climate, active involvement, performance, and articulated goals. The regression analysis showed articulated goals, intent to learn, and interaction climate having a significant positive effect on acquired knowledge. Clear written guidelines for the IJV organization’s goals and plans are the most influential factor and the first step in signaling a genuine learning intention, as well as in creating the right atmosphere for the transfer of knowledge. The findings of this study are expected to guide government agencies, policy makers, and construction practitioners when reflecting on their strategic plan before entering into IJVs. This research provides knowledge-transfer enablers for the successful joining of resources for two or more firms into a separate jointly owned entity. Also, an understanding of knowledge acquisition builds local capacity and minimizes external dependencies.

Success Factors Among Industrialised Building System (IBS) Contractors in Malaysia

Construction joint ventures in Malaysia are become increasingly popular both with local and foreign companies in order to achieve their individual objectives. The contractors need to know the success factors, which were consider critical for their JVs to be successful. This paper aims to identify the success factors of joint venture projects among IBS contractors in Malaysia. Questionnaires were distributed to 200 IBS contractors registered under the Construction Industry Development Board (CIDB) in Malaysia with fifteen percent (15%) replied. Questionnaire consists of information regarding the level of joint venture acceptance and the success factors of joint ventures among IBS contractors. It was found that there were nine (9) factors of success which were experienced workforce and technical capability, skilled labour for site installation, good working collaboration, coordination of design, manufacture and construction, effective communication channel and close relationship with suppliers or contractor. It is recommended that these nine factors are considered as the key success factors of joint venture among IBS contractors. It is hope that those factors will provide useful guidelines for all contractors whom intend to pursue the joint venture on IBS projects.

Joint venture versus non-joint venture projects in the UAE construction industry: a comparison of the usage of project management practices and performance

The purpose of this paper is to report on a study comparing joint venture and non-joint venture projects in terms of their performance and usage of project management practices. Data were obtained from project managers at 99 contracting organisations in the United Arab Emirates (UAE) construction industry. The results show an agreement between the two types of project in the usage level of 35 out of 40 different practices associated with the ten knowledge areas articulated in the Project Management Institute (PMI) Project Management Body of Knowledge (PMBOK) Guide (PMI, 2017). However, joint venture construction projects had higher usages of four cost-and procurement-related practices compared to non-joint venture construction projects. The results also show that although they are associated with increased risks due to the involvement of partners, generally the overall performance of joint venture construction projects is comparable with that of non-joint venture construction projects. The findings of this study could be of value to organisations that are planning to form joint venture projects in the UAE and other countries with similar environments.

Critical success factors influencing performance outcome of joint venture construction projects in South Africa: Comparison of first and second order models

Joint ventures (JVs) have become increasingly common, because of the complexity and challenges associated with the delivery of construction projects globally and in South Africa. However, it has been established that JV projects have experienced unsatisfactory performance leading to clients’ dissatisfaction. The purpose of this paper is therefore to determine the critical success factors (CSFs) influencing the performance of JV construction projects in South Africa. A positivist philosophy position was adopted using a structured questionnaire survey administered to the construction professionals. Prior to the main study, a content validity of the questionnaire was achieved using a pilot study. The data was collected from 115 conveniently sampled respondents, and analysed using principal component analysis and multiple regression analysis. The exploratory factor analysis revealed two empirical models to be tested; namely the first and second order factor models. The result of the first order model revealed that, management control influenced achievement of project objective of JV, whereas, the second order model established that understanding of contractual agreement, which was explained by six components of CSFs influenced achievement of project objective. It is suggested that stakeholders who prefer to be involved in JV projects should acquire good understanding of the contractual agreement in managing JV projects in order to successfully achieve the project objectives. This study adds to the discourse and literature on CSFs of JVs. It provides new empirical evidence of the CSFs that influence project performance outcome of JV in the context of South Africa which can also be replicated in other countries globally. However, the study may not be generalised because of the geographical setting and respondents.