Private Sector Clients Research Articles

Liquidity Regulation, Funding Costs and Corporate Lending

This paper analyzes the impact of a liquidity requirement similar to the Basel 3 Liquidity Coverage Ratio (LCR) on banks’ funding costs and corporate lending rates. Using a dataset of 26 Dutch banks from January 2008 to December 2011, I find that banks which are just above/below their quantitative liquidity requirement do not charge higher interest rates for corporate lending. This effect is caused by banks being not able to pass on their increased funding costs in the interbank market to private sector clients, implying that banks do not have pricing power. The results are robust to including demand effects, solvency and loan characteristics. The analysis in this paper suggests that the current design of the LCR is unlikely to have a major impact on corporate lending rates.

Corruption in the South African construction industry: a thematic analysis of verbatim comments from survey participants

Corruption is a pervasive stain on the construction industry in many countries. South Africa is no exception. A questionnaire survey showed that corruption there is perceived to be widespread. Beyond the quantitative survey findings, thematic analysis was used to explore the verbatim comments offered by many survey participants. This analysis clarified the nature and extent of corruption more precisely and four predominant themes emerged: involvement in corruption, forms of corruption, factors that may give rise to corrupt activities, and the means of combating corruption. Public officials are thought to be actively involved in acts of corruption, particularly in the soliciting of bribes and in tender manipulation. Professional consultants and other actors in the construction supply chain are not above reproach. Forms of corruption centre largely on appointment and tender irregularities, and to a lesser extent on contract administration and closeout irregularities. Factors instrumental in corruption include the skills shortage within the industry, a perceived absence of deterrents and sanctions, and poor ethical standards. Procedural impediments, fear of victimization and personal attitudes all act as barriers to combating corruption. While confirming opportunity, pressure and self-justification as the three pillars of the Cressey ‘Fraud Triangle’ theory of corruption, the research findings suggest that a more dynamic interpretation of this model is advisable. In addressing corruption, at least in the public sector, improvements in procurement processes are needed along with shifts towards higher standards of ethical behaviour among public sector employees at all levels. Greater procurement process transparency (in both public and private sectors of the industry) would address the worst effects of undue political interference and nepotism. The South African construction industry (particularly its statutory professional councils and contractor affiliation bodies), together with public sector agencies and private sector client associations, should collaborate to adopt a more proactive stance against corruption, and be more engaged with detecting and reporting it.

The commercial currency of construction framework agreements

A critique is presented of construction client–main contractor framework agreements. In the midst of an unpredictable and volatile construction environment, the commercial currency of collaborative working practice, and by extension framework agreements, is being put under increasing management scrutiny. Drawing on a literature review, the guiding principles of framework agreements are examined. A dramatic downturn in construction demand has created considerable surplus in supply. Under such conditions the buyer–supplier interdependencies become imbalanced and commercial relationships fraught. Reports by construction industry analysts demonstrate a number of private sector clients rejecting framework agreements in favour of traditional competitive procurement practices. Drawing upon a neoclassical lens, three guiding principles embedded within economic orthodoxy are employed to examine business-to-business tensions within construction framework agreements, namely, individualism, instrumentalism and equilibrium. This neoclassical interpretation of construction framework agreements reveals a potential relational management bias within mainstream rhetoric. Notably, providing a complementary account of framework agreements practice should not be construed as a rejection of collaborative working practices. An alternative account of framework agreements is presented that does not rely upon the mainstream behavioural model of contemporary contracting.

BIDDING DECISION MAKING FOR CONSTRUCTION COMPANY USING A MULTI-CRITERIA PROSPECT MODEL / STATYBOS ĮMONĖS APSISPRENDIMAS DALYVAUTI KONKURSE NAUDOJANT DAUGIAKRITERINĮ PERSPEKTYVŲ MODELĮ

Two critical decisions faced by bidders in competitive bidding include, firstly, whether or not to submit a bid, and secondly (if the answer to the first is ‘yes’) what markup value should be used on the submitted bid. In the construction industry, government agencies and private sector clients typically adopt competitive bidding to determine contract awards. Contractors also apply the same approach to bidding decisions. There are many variables that affect contractor decisions regarding whether to bid and the markup scale, which complicate the bidding decision process. This study proposes a Multi-Criteria Prospect Model for Bidding Decision (BD-MCPM) to assist contractors to make decisions on bid/no bid and markup scale. Key factors of influence that impact bidding decisions were identified first. Second, Fuzzy Preference Relations (FPR) was employed to assess factor weights and determine bid/no bid. Finally, if a decision to bid is given, then the Multi-Criteria Prospect Model (MCPM), which links Fuzzy Preference Relations (FPR) and Cumulative Prospect Theory (CPT), is deployed to determine the markup scale that best conforms to primary decision maker (PDM) preferences. The applicability of this model was demonstrated in a real case study. Santrauka Ketinantiems dalyvauti konkurse reikia priimti du lemiamus sprendimus: ar teikti pasiūlymą ir kokį antkainį nurodyti pasiūlyme. Statybų sektoriuje valstybės įstaigos ir klientai iš privačiojo sektoriaus paprastai konkursus skelbia siekdami išrinkti laimėtoją, su kuriuo pasirašoma sutartis. Rangovai sprendimus dalyvauti konkurse vertina taip pat. Rangovų apsisprendimą dalyvauti konkurse ir pasirinktą antkainį lemia ne vienas kintamasis, ir tai apsunkina apsisprendimo dalyvauti konkurse procesą. Šiame tyrime pristatomas daugiakriterinis perspektyvų modelis apsisprendimui dalyvauti konkurse (BD-MCPM), kuris rangovams padės apsispręsti, ar dalyvauti konkurse ir kokį antkainį pasirinkti. Pirmiausia buvo nustatyti pagrindiniai veiksniai, kurie daro įtaką apsisprendimui dalyvauti konkurse. Po to, naudojant neraiškiuosius prio- ritetinius ryšius (angl. Fuzzy Preference Relations, FPR), buvo įvertinti veiksnių reikšmingumai ir nustatyta, dalyvauti ar nedalyvauti konkurse. Pagaliau, jeigu nusprendžiama dalyvauti konkurse, naudojant daugiakriterinį perspektyvų modelį (MCPM), kuris neraiškiuosius prioritetinius ryšius susieja su kaupiamaja perspektyvos teorija (angl. Cumulative Prospect Theory, CPT), nustatomas antkainio lygis, kuris labiausiai atitinka pagrindinio sprendimus priimančio asmens pageidavimus. Praktinis šio modelio naudingumas pademonstruotas atliekant atvejo tyrimą.

The rights and responsibilities implied by academic freedom

Academics enjoy freedom from retaliation for their statements that goes beyond the freedom accorded to other members of society. Academics are also often called upon to act as advisors, either to society as a whole or to public and private sector clients. This sets up a tension between freedom to speak and an obligation to speak responsibly. The problem can be acute in the field of individual differences, for findings related to individual differences touch upon the relations among different racial/ethnic groups, between genders, and have implications for educational and personnel policies. Examples are given of situations in which, in the author’s opinion, academics have abused their roles as expert advisors by speaking irresponsibly. At issue is not whether or not the person speaking reached a correct conclusion, but whether or not the evidence and reasoning about the evidence met reasonable standards for careful inquiry and analysis. Formal actions by governments or by university administration are seldom the answer. Standards enforced by professional societies are less problematical, but are far from complete solutions. The best way to handle the problem is to encourage open discussion of the issues involved, both between established academics and between faculty and students.

Assessing contractor selection criteria weights with fuzzy AHP method application in group decision environment

A tender procedure should facilitate selection of a reliable contractor with consideration to many criteria. Polish public procurement law, harmonized with EU guidelines on the subject, describes selection procedures in detail. Similar procedures are adopted by private sector clients as there exist no private sector specific procurement codes of practice. In the case of public procurement, the bid selection criteria have to refer to the object of procurement and not to the proprieties of a bidder. The client, in order to assure adequate quality of works (i.e. selection of a reliable and capable contractor) can, within the limits enforced by law, set conditions the bidders have to fulfill if they are to participate in a tender or negotiation procedure. The assessment based on criteria related with a bidder's technical and economic capability can be made also at the prequalification stage in restricted tendering procedures. The authors suggest the application of an extended fuzzy AHP method to the process of group decision making. This approach facilitates defining criteria weights by aggregation of decision makers' judgments. The paper presents an example that illustrates this approach to determining criteria weights for bidder assessment. The results show that the proposed fuzzy AHP method is superior to the traditional AHP in terms of improved quality of criteria prioritization.

The psychological role of the leader in turbulent times

PurposeThis paper aims to deliver a psychological perspective on the theme of leading in turbulent times.Design/methodology/approachDrawing on 20 years' experience of consulting, coaching and teaching in the field of leadership development, the author outlines the dynamics that businesses face during an economic crisis. Based on her extensive observation of workplace behavior, the author describes the psychological and emotional role that leaders need to play if they are to optimize morale and productivity during turbulent times. The author's ideas have been developed as a result of coaching numerous leaders and top teams at board and director level in FTSE 100 and 250 companies and top professional services firms, as well as SMEs and not‐for‐profit organizations. Her private sector clients come from every area, including investment banking, oil and gas, IT, property, retail, law, accountancy and venture capital. Many of these organizations operate in highly competitive markets where managing uncertainty and change is the norm. However, the economic downturn has presented additional challenges, especially to those at the sharp end of the credit crunch and the collapse in consumer confidence.FindingsIt is concluded that four leadership behaviors are critical in times of crisis. Taken together, they enable leaders to support their workforce effectively during turbulent times, so maximizing morale and performance. The paper also highlights the role of HR and specific ways in which seasoned HR professionals can help leaders manage their own emotions and demonstrate these four behaviors.Originality/valueThis article reflects the author's original, practice‐based observations about organizational dynamics and leadership behavior during challenging times.

Assessment of lightning-related damage and disruption in Canada

This article assesses the extent and costs of lightning-related damage and disruption in Canada. Lightning routinely damages property and disrupts economic and social activities. Affected sectors include health; property and casualty insurance; forestry; electricity generation, transmission, and distribution; agriculture; telecommunications; transportation; and tourism and recreation—the first four sectors are the most important in terms of contributing to overall impacts and costs. Secondary data and extrapolations from U.S. studies were used to develop cost estimates for the health, property, forestry, and electricity sectors. Aggregated, annual lightning-related damage and disruption costs in Canada range from CA$600 million to CA$1 billion. Forestry and electricity damages accounted for over 85% of the total. The estimates are both preliminary and conservative. In terms of continued research, additional or more refined studies using Canadian empirical data are warranted for the insurance and electricity sectors. Detailed insurance claim or outage data would permit analysis at the storm level and potentially discern finer-scaled risk patterns. Further effort is also required to evaluate risk or damage prevention measures, particularly those that relate to expanded or enriched use of the Canadian Lightning Detection Network data by both public and private sector clients. Both the degree of adoption and efficacy or cost-effectiveness should be investigated.

Contractor selection: fuzzy-control approach

This paper presents a fuzzy-logic-based system for selecting contractors. This tool, which was based on the fuzzy control technique, was created for the private sector client in traditional design–bid–build projects with one-step selection processes, but its philosophy can also serve other types of clients, industries, contracts, and selection processes. The system develops an assessment of different qualitative and quantitative issues that influence a contractor’s suitability for constructing a specific design in a specific environment (client’s needs and objectives, objectives prioritization, etc.), taking into account the risk of not achieving the client’s objectives. A computer application was developed and validated, including a Delphi analysis with professionals who are experts in contractor selection. The application covers the possibility of using different selection policies, when the essential project objective is cost, time or quality. As part of the validation process, a neural network was developed to prove that the fuzzy-control tool has a behavior that can be recognized by a neural network.

Partnerships and the role of financial advisors: private control over public policy?

English This article shows how the use of private sector advisors, predominantly from the Big Four accounting firms, to develop and manage the government's Public–Private Partnerships policy, has led to the privatisation of policy formulation and implementation. Financial advisors develop the policy and appraisal procedures, appraise individual projects, and advise both public and private sector clients. In some cases, the firms also have an equity stake and/or are key subcontractors. They prepare evaluative reports on the same policies in which they have a vested interest. Such conflicts of interest raise questions about who controls policy and the implications for democracy.

The fee tendering and service quality issue revisited

PurposeIt is a little over 20 years since mandatory fee scales were abolished by UK professional bodies. During this period fee levels have fluctuated with economic demand, and new procurement strategies such as partnering have been developed, but there is still a widespread view in industry that fee levels are too low. This view is shared by many professionals, and perhaps more surprisingly by clients, even in the current construction and property boom. The purpose of this paper is to report research on the link between competitive fee tendering and clients' perceptions of service quality in the UK property industry. The main hypothesis is that there is a causal relationship between service quality and the method of appointment of the professional.Design/methodology/approachThe research involved unstructured interviews with clients and professionals and a postal questionnaire study of one 133 UK based clients. The questionnaire study was a repeat of a similar survey conducted eight years previously in very different economic conditions. The public and private sector clients each assessed the service quality received from a professional using a measurement scale developed from the generic service industry instrument SERVQUAL. The scale is used to test the main hypothesis and four sub‐hypotheses. There were twice as many private sector clients completing the questionnaires as there were public sector clients and the largest group of professionals assessed were General Practice Chartered Surveyors.FindingsThe results of the recent study are similar to the earlier one (in that evidence of the predicted relationship is not provided by the data) but there are some interesting differences in the results of both studies – fee tendering has declined in popularity, direct appointment has increased, but less than 5 per cent of the commissions were let on a partnered basis.Practical implicationsProperty managers and other professionals may wish to make use of the service quality measurement scale in order assess the service they provide to clients.Originality/valueThe research provides confirmation that clients do not perceive that a lower standard of service quality is provided for fee‐tendered commissions. It also extends the already substantial body of research based upon the SERVQUAL measurement technique.

2020 Liverpool—performance and value for money

2020 Liverpool Ltd is a joint venture company owned by Mouchel Parkman and Liverpool City Council. It was set up in 2003 to deliver technical professional services to the City Council and other public and private sector clients. It is a fully functioning company and all staff are employed directly by the company. The company has a 10 year service contract with the Council, which has an optional renewal for a further 10 years. The partnership is performance based with key measures including efficiency saving, delivery of programmes, reliability of estimates, and customer satisfaction. This paper describes how these are measured and experience to date. In addition the partnership has devised and implemented a methodology for assessing value for money, which this paper also describes. It is believed that the 2020 model is the closest to that used in the manufacturing industry from which the concepts used in the public arena have been derived.

2006 Award of Merit acceptance speech

2006 Award of Merit acceptance speech

Change in construction: a critical perspective

Change within the construction sector has been a central concern of governments and a select few private-sector clients for a considerable time. The discourse of change emanating from organizations concerned with reform in the construction sector reflects these ongoing concerns for change in the sector. The underlying assumptions of the content of change and appropriate change mechanisms in the UK are critically examined and challenged. In particular, the limitations of measurement and best practice are explored. The allegiance to approaches based on measurement and best practice is acontextual, unreflective and insufficient in providing wholly reliable explanations for the relationship between practice and performance. Claims for the use of measurement and best practice by the reform movement must therefore be understood to have limitations and their use approached with caution. The emphasis on best practice is also understood to direct attention away from understanding the legitimacy of current practice and change within the UK construction sector. An agenda for change in the UK construction sector will need to engage with and be more reflective of current managerial practice and past change initiatives. Contextual approaches such as structuration theory offer a way in which to underpin a research framework that could support the reform movement in setting such an agenda. Depuis longtemps, les changements qui interviennent dans le secteur de la construction sont une préoccupation majeure pour les gouvernements et pour quelques clients sélectionnés du secteur privé. Le discours sur le changement émanant d'organisations préoccupées par la réforme dans la construction reflète l'inquiétude permanente causée par le changement dans ce secteur. Les hypothèses sous-jacentes portant sur le contenu et sur les mécanismes appropriés du changement au Royaume-Uni font l'objet d'un examen critique et sont mises en question. L'auteur analyse, en particulier, les limitations des mesures et des meilleures pratiques. Les positions en faveur d'approches basées sur les mesures et les meilleures pratiques sont hors contexte, non représentatives et insuffisantes puisqu'elles ne parviennent pas à fournir une explication totalement fiable des relations entre la pratique et la performance. Il est donc clair que lorsque le mouvement en faveur de la réforme encourage l'utilisation de mesures et des meilleures pratiques, celles-ci on des limites et leur utilisation doit être envisagée avec précaution. En mettant l'accent sur les meilleures pratiques, on détourne l'attention de la compréhension de la légitimité des pratiques actuelles et des changements dans le secteur de la construction au Royaume-Uni. Tout programme de changement dans le secteur de la construction au Royaume-Uni devra être associé à des pratiques de gestion plus réfléchies et tenir compte d'initiatives de changement prises dans le passé. Des approches contextuelles comme la théorie de la structuration offrent une méthode sur laquelle pourra s'appuyer un cadre de recherche qui pourrait apporter son soutien au mouvement de réforme en définissant un tel programme. Mots clés: analyse comparative, meilleures pratiques, gestion du changement, projets de démonstration, performances de l'industrie, innovation, indicateurs de performances clés, changement organisationnel, mouvement de réforme

Granite Construction Inc.

AbstractConstruction ‐ Public Infrastructure (MIC: 3.1 SIC: 1611 NAIC: 237310)Granite Construction is a heavy civil construction contractor that serves both public and private sector clients in the U.S. Within the public sector, Co. primarily concentrates on infrastructure projects, including the construction of roads, highways, bridges, mass transit facilities and airports. Within the private sector, Co. performs site preparation services for buildings, plants, subdivisions and other facilities. Co.'s operations are divided into two segments. The Branch Division is comprised of branch offices that serve local markets, while the Heavy Construction Division is composed of regional offices and pursues major infrastructure projects throughout the nation.

Examining architects' performance in Nigerian private and public sectors building projects

PurposeThe aim of this paper is to examine and compare the performance of architects with respect to clients' rating of importance over a set of performance criteria in Nigerian public and private sector building projects.Design/methodology/approachA survey involving clients from both public and private sectors of recently completed building projects in Nigeria was undertaken. Data analysis includes comparing similarities and differences using standardised ratio, Mann Whitney U and Wilcoxon tests.FindingsThe results show that private sector clients are likely to be more concerned with cost, while public sector clients are more concerned with buildability of design. A total of 79 per cent of the criteria were similarly selected by both sectors with respect to importance of the criteria. Architects need to improve their performance significantly in about 82 per cent of the whole set of 28 criteria. The architects performed better in the public sector than the private sector and 14 per cent of the criteria were indicated as being statistically different in terms of architects' performance.Originality/valueThe results provide feedback which can be incorporated in architects' future projects so as to ensure successful project implementation in the building delivery process.

On dealing with bias

Science and Engineering Ethics, Volume 8, Issue 4, 2002 483 Each and every investigator or engineer arrives at a problem with his or her own history and current situation as their occupational baggage. Embedded interests abound; the need to retain a job for the salary it provides; the desire for promotion; the wish for esteem from colleagues; the obligation to reciprocate for a previous service rendered; the thought that a sacrifice on this occasion may lead to a benefit at the next opportunity; the enhancement of self-image from solving a problem others found intractable; the psycho-social bias derived from politics or attitude; scepticism of the work of others; this list is unlimited. One may as easily compose a list of inducements that derive from external sources; the offer of money, position, preferment, support for achieving ambitions, the prevailing dominant paradigm, power and publication. Many of these driving forces act at the same time in relation to the same project. Some of the influences that impinge on an individual are wholly conducive to the appropriate and successful accomplishment of the mission. Others distort the outcome and satisfy needs other than those of the immediate operator. When the latter occurs we can clearly identify a conflict of interest where the more powerful and resourceproviding outside agency has leant on the operator to generate data or products that are more to the advantage of the agent than they are to the society as a whole. This generation of bias by the expression of the interests of a funding agency will generate a spectrum of responses from those that enhance the value of the project to the society to those that may lead to social harm. As more and more academics are encouraged to interact with private, voluntary, charitable and public sector clients who have clear and unique agendas of their own making, it is well for society as a whole to be aware of pressures that may cause distortion of work programs in directions that are antithetical to social well-being. This awareness can only be achieved by full disclosure of all effective sources of influence. These could be of the internal variety and be based on the particular driving forces of the individual in addition to those imposed by an external or funding agency. There maybe sources of bias whose disclosure may cause a dilemma. The race, religion, ethnic origin, marital status, health history, legal past and mental history may be Editorial On Dealing with Bias

Research Centers and Consultancies

The AERC provides a focal point within Australia, on issues of indigenous housing and architecture for academic, government and community sectors. It fulfils three functions as: an undergraduate and postgraduate teaching centre, a research practice, and an archive incorporating an extensive collection of literature and images. The allied consultancy practice delivers services ranging from architectural design and settlement planning, to anthropological research, and has worked with numerous indigenous agencies, as well as government and private sector clients. Contact: Assoc. Prof. Paul Memmott, Director

Cost–time performance of public sector housing projects in Nigeria

The performance of the construction industry in Nigeria has consistently been a source of concern to both public and private sector clients. Previous studies have identified cost and time overruns amongst others as key performance indicators. This is particularly significant for public sector clients in Nigeria, where due to poor budgetary control, many projects have been abandoned at various stages of completion. This paper is set to evaluate the magnitude of this problem at key stages in the process, from budgetary planning to completion, using the public sector client as exploratory model.

Team inspections of high‐rise buildings in Hong Kong and the UK

Covers topics such as the method and order of inspection, use of checklists and inspection data sheets, team inspections and the roles of the various contributing consultants and duties of the team leader, condition consensus for team inspections and the requirements of both public and private sector clients. Uses case studies from Great Britain and Hong Kong to provide examples. The case studies have been selected because they are from condition inspections of high‐rise buildings.