Subcontractor Management Research Articles

The application of Bayesian network analysis in demystifying construction project subcontracting complexities for developing countries

PurposeThis study aimed to address a gap in subcontractor management by focusing on previously unexplored complexities surrounding subcontractor management in developing countries. While past studies concentrated on selection and relationships, this study delved into how effective subcontractor management impacts project success.Design/methodology/approachThis study used the Bayesian Network analysis approach, through a meticulously developed questionnaire survey refined through a piloting stage involving experienced industry professionals. The survey was ultimately distributed among participants based in Accra, Ghana, resulting in a response rate of approximately 63%.FindingsThe research identified diverse components contributing to subcontractor disruptions, highlighted the necessity of a clear regulatory framework, emphasized the impact of financial and leadership assessments on performance, and underscored the crucial role of main contractors in Integrated Project and Labour Cost Management with Subcontractor Oversight and Coordination.Originality/valuePrevious studies have not considered the challenges subcontractors face in projects. This investigation bridges this gap from multiple perspectives, using Bayesian network analysis to enhance subcontractor management, thereby contributing to the successful completion of construction projects.

A review of Factors Affecting the Performance of Subcontractors in construction Industry

The construction industry has a complex supply chain, where subcontractors play a significant role in the success of construction projects. Subcontractors are responsible for delivering specialized services, such as electrical, plumbing, and HVAC systems, among others, which are critical for the successful completion of construction projects. Therefore, understanding the factors that affect the performance of subcontractors in the construction industry is essential for improving project outcomes. This study examines the factors that influence the performance of subcontractors in the construction industry. Using Literature reviews, the study identifies several factors that impact subcontractor performance, including project management, communication, collaboration, financial stability, and trust. The meta-analysis shows that effective management of these factors can lead to improved subcontractor performance, which is critical for the success of construction projects. The study provides a comprehensive understanding of the key factors affecting subcontractor performance and offers insights to assist project managers in improving their subcontractor management strategies. The findings from this study contribute to the existing literature on subcontractor performance in the construction industry and have practical implications for project management practices.

Pythagorean Fuzzy AHP Based Dynamic Subcontractor Management Framework

In construction projects, a significant part of construction work is done by subcontractors (SCs). Therefore, their management by main contractors (MCs) becomes an important issue as the density of SCs is created at the construction sites. In recent years, more focus on SC evaluation and selection in bidding process has been on the agenda whereas the subject of SC performance appraisal on-site during the project execution phase has been untended in the literature. Thus, this study aims to focus on the measurement and evaluation of the performance of SCs in the project execution phase, and to provide a tentative performance-based dynamic management framework that MCs will use in the management of SCs in order to take proactive measures. In line with the aim, a total number of 23 performance measurement criteria (PMC) under 7 main groups were determined as a result of a comprehensive literature review and expert evaluations. Knowing that not every criterion will have the same effect in performance measurement, pairwise comparisons of the criteria were made using the Pythagorean Fuzzy Analytic Hierarchy Process (PFAHP) method and their importance weights were determined. The PFAHP method was obtained by integrating the Pythagorean fuzzy set into the AHP method and chosen with the aim of improving the fuzzy AHP method and obtaining more consistent results by eliminating the uncertainty since Pythagorean fuzzy sets is more capable than fuzzy sets at expressing and handling uncertainty in uncertain environments. Lastly, a framework for SC performance measurement and evaluation on project execution phase is presented. It is believed that the presented framework will allow for a proactive management style that will enable effective decisions to be made while the project is ongoing, and a dynamic way of working instead of static and conventional work.

Determination of Contractor Strategies in Delivering Construction Projects in Oman

Contractors are responsible to deliver construction projects as per contract. Past literature highlighted various implications of poor project delivery and as the ones who are responsible to deliver the project, contractors need to plan and strategise to ensure their projects are successfully delivered to the client. This article focuses on identifying the strategies adopted by Omani main contractors to deliver construction projects successfully. Using 48 strategies identified through literature review, a survey has been conducted with 108 main contractors in Oman with top grade level of Oman Chamber of Commerce and Industry (OCCI) to investigate the significant strategies adapted ensuring successful project delivery. The top grade level contractor is on the focus of this research because they are involved as main contractors for construction projects in Oman. Using factor analysis technique, the 48 strategies have been reduced into 28 sub-strategies which are grouped into 7 main strategies. The seven main strategies are: (1) People and subcontractor management, (2) Technology and innovative solutions adoption, (3) Quality, safety and environmental protection, (4) Develop technical capability, monitor and control, (5) Organisational efficiency and financial stability, (6) Legislative compliance and (7) Clients’ satisfaction. This research revisits the successful strategy for project delivery and restructures them to suit the practices in Oman. The strategy can be emulated by contractors in the country and perhaps other Middle East countries, as a way to expedite better construction performance.

Impact of owners’ safety management behavior on construction workers’ unsafe behavior

Construction safety is a serious issue in the construction industry, while workers’ unsafe behavior is one of the major factors leading to construction accidents. It is believed that owners’ safety management behavior has an important impact on workers’ unsafe behavior. However, the specific impact mechanism is not yet clear from the perspective of owners, resulting in that the role of owners’ safety management in safety performance is relatively low. This research aims to reveal the impact path and ability of owners’ diverse management behavior on workers’ safety behavior by establishing a structural model, which contains the dimensions under the Theory of Planned Behavior (TPB) and Behavior-Based Safety (BBS). Firstly, based on the theories, the key safety management dimensions in developers or owners were determined and the hypothetical model of the safety impact mechanism is presented. Then, a questionnaire survey was conducted in a large real estate developer in China, 2,991 valid questionnaires were collected. Empirical analysis was further conducted by using Confirmatory Factory Analysis (CFA) and Structural Equation Modeling (SEM). The results show that objectives and assessments (OA) and safety organization (SO) have an indirect effect on workers’ safety behavior (WSB) through management practices (i.e., hazard and emergency management (HEM), and subcontractor management (SM)), while WSB also influences accident management (AM). Particularly, the path with the most impact power is OA-SO-HEM-WSB. These research findings can guide developers or owners to participate in the performance improvement of construction safety management.

Improving Sustainable Project Success Strategies Focused on Cost and Schedule for Electrical Construction Project Management

Electrical contractors encounter problems such as limited construction sites, schedule interference, and inefficient communication with other contractors when they typically subcontract with general contractors. Electrical projects require effective and systematic project management strategies to overcome these problems and achieve the desired goal. In an electrical construction project, individual tasks are interconnected at different stages, including pre-construction planning (PCP) and project execution (PE). Therefore, analyzing the effect of task strings on the project success in terms of schedule and cost performance is necessary. The main objective of this study is to perform a static analysis to compare successful and failed projects with a focus on the cost and schedule performances, using the PCP and PE task strings in electrical construction projects. To achieve this, a continuous PCP-PE task strings implementation score was calculated for each PE group in terms of cost and schedule, and successful and failed projects on unweighted and weighted values were compared and analyzed by performing an independent sample t-test. Consequently, it was confirmed that the use of most task strings had a positive effect on the cost success at a confidence level of 95%, and that only the subcontractor management group had a positive effect on the schedule success. Hence, it was derived that the usage of task strings for these groups is recommended for cost success in electrical construction, and continuous PCP-PE task strings do not have a positive effect on schedule success; therefore, it is recommended to use the PCP-PE task strings only for specific groups for schedule success in electrical construction. Demonstrating the relationship between the PCP and PE tasks, the findings of this study are expected to help electrical contractors achieve a better performance using effective project management strategies.

Особенности проверки добросовестности контрагентов проектных организаций при исчислении НДС по экспортным операциям

The article presents the results of a study on the assessment procedure of counterparty integrity, which helps to determine the reliability and legal status of any involved contractors. The argument rests on the methods of system and institutional analysis, economic analysis of business operations, and comprehensive legal analysis of entrepreneurial operations. Relevance of the study consists in the theoretical and practical importance of efficient subcontractor management, as well as in the need of an engineering design company to establish a unified procedure for dealing with partners. The procedure of integrity assessment of counterparties (suppliers, subcontractors) of a design company includes some economic and legal techniques. Design companies use the counterparty integrity concept in verifying whether the value added tax on exports is computed correctly, whether the VAT refund (deduction) is justified, and whether the procurement of some works, services and commodities is economically reasonable. Verification of the physical existence of a counterparty and the authority of persons who sign contracts and issue letters of authorization is also provided. In contrast to existing verification methods, the approach used in this article allows choosing the best way to deal with international partners. Additional measures to disclose unfair practices of partners by means of a legal review of counterparty documents are developed. The article presents a tested form of reporting of counterparty negotiations. A set of measures for a detailed counterparty verification allows systematizing the procedure of integrity assessment of counterparties (suppliers, subcontractors) of a design company. The procedure and measures suggested in the paper will help design companies reduce their business risks.

Role of Building Information Modelling (BIM) in Sub-Contractor Management

Construction industry being an excellent example of supply chain has various key components which are interlinked and interdependent on each other. The whole chain is glued on communication among each other. Any lack in the flawlessness of this communication breaks the chain and the whole system gets affected. The work breakdown structure of this industry is structured in a hierarchical manner and works on decentralization of the authority. The most common lack of communication has been observed between the Contractor and Sub-contractors which causes multiple issues during delivery. Thus, this study has established a workflow through which BIM (Building Information Modelling) can be employed to improve communication between the Contractor and Sub-contractor of a project. This document gives formatting instructions for authors preparing papers for publication in the Proceedings of an IEEE conference. The authors must follow the instructions given in the document for the papers to be published. You can use this document as both an instruction set and as a template into which you can type your own text.

A genetic algorithm for subcontractors selection and allocation in multiple building projects

In construction industry, general contractors (GCs) need to manage and conduct numerous projects simultaneously. To this aim, they usually have subcontractors conduct available tasks and projects. So, subcontractor management is becoming a major challenge. To deal with this challenge, GCs aim to reduce total costs of projects including employment/subcontracting costs, indirect costs, tardiness penalties, and the money which must be paid for movement of workforce from one project to another. The aim of current research study is to propose a model for selecting subcontractors and assigning available tasks in the project to them in order to reduce the costs of the GC. Then, a genetic algorithm is proposed to solve a real problem. The proposed algorithm is innovative from three points of view: (1) generation of initial population; (2) subcontractor assignment approach; and (3) the objective function. The problem was also solved by means of an exact method. Then, the results of proposed algorithm were compared to the outcomes of the exact method. This comparison shows that the proposed algorithm can efficiently help GCs select subcontractors and assign available tasks to each subcontractor when several projects must be carried out simultaneously.

Investigating Rework: Insights from the Malaysian Construction Industry

Construction practitioners recognise that rework is undesirable due to the detrimental effects. While rework literature has examined rework causation factors in construction projects, the problem continues to plague the industry resulting in poor delivery performance. To better understand this phenomenon and given the scarcity of Malaysian-based rework study, a questionnaire survey involving 130 Malaysian construction practitioners (consultants, contractors and clients) were undertaken to obtain feedback about nature, implications, causes and solutions for rework. Data were analysed using descriptive statistical techniques to prioritise the variables studied. From the analyses, rework is a causal factor for delays and cost overruns, higher wastage and productivity inhibitor. The findings revealed the leading causes of rework are poor quality management, improper planning, lack of communication, design changes and poor subcontractor management. Some practical rework minimisation approaches are also suggested to better manage and prevent rework towards enhanced project performance.

Influence of Subcontractor Risk Management on Quality Performance of Building Construction Projects in Ghana

This study intended to examine the influence subcontractor risk management has on the quality performance of building construction projects. Using a quantitative research method, five hypothesised constructs were tested. The views of 139 Heads of Works for Metropolitan, Municipal and District Assemblies (MMDAs) in Ghana were elicited using a structured questionnaire. A confirmatory factor analysis (CFA) based on structural equation model (SEM) was adopted in analysing the data obtained. The findings suggest that the management of four (financial risks, resource risks, technical risks and managerial risks) out of the five categories of risks positively influenced the quality performance of building construction projects. Relationship risks showed no significant influence on construction quality performance. The study showed quantitatively the effects of sub-contractor risks on quality performance. It provides a vivid relationship between the concept of sub-contracting and quality performance. Therefore, failure to properly manage risks sourced from sub-contractors on a building construction project will have a major adverse consequence on the quality performance of the project. This study further advances efforts at understanding the link between sub-contractor management and project performance with a particular focus on the management of risks emanating from the use of subcontractors on building projects.

Rework Causation that Undermines Safety Performance during Production in Construction

Rework is positively linked with increased safety risks. As a precursor to decreased rework and enhanced safety performance, this study appraised the correlative causes of rework and safety incidents. To do this, 20 rework causes that undermine safety performance were first identified through the literature review. Using a survey questionnaire involving Malaysian construction professionals (owners, consultants, and contractors), the causes were prioritized based on frequency, severity, and importance indices. The five leading rework-safety causes were ranked as follows: poor coordination, insufficient communication, poor subcontractor management, improper supervision and inspection, and poor site management. Spearman's rank correlation tests revealed a significant agreement between the respondent groups. An exploratory factor analysis identified the five major underlying causal dimensions of rework and safety incidents to relate to the substandard management of equipment and machinery, poor project management practices, inherent dangerous, dirty, and difficult (3D) characteristics, improper production planning and work pressure, and inadequate personnel competency and knowledge. This paper bridges the identified knowledge gap concerning the dimensionality of rework and accident causation in construction, and the findings provide guidance for devising preventive measures for simultaneously addressing rework and safety problems.

Going beyond environmental regulations—The influence of firm size on the effect of green practices on corporate financial performance

AbstractDespite the various environmental regulations to address the negative effect of construction activities on the environment, the construction sector is still slow to implement green practices (GPs). To encourage construction firms to implement GPs, these firms should be convinced that GPs are a financially viable endeavour. This paper aimed to analyse the influence of GPs on corporate financial performance (CFP) and investigate whether firm size influences that effect. A survey was employed to gather information from Malaysian construction firms, and the data were analysed using partial least squares structural equation modelling. The findings indicate that green supplier management, green subcontractor management, and green project management have significant effects on CFP and that large firms with high levels of green business practices and green project management attained higher CFP than small and medium enterprises. Policymakers and managers should take a flexible approach to boost GPs in the construction industry.

Gap Analysis between ERP procedures and Construction procedures

Although Enterprise Resource Planning (ERP) offers many benefits to the construction industry, construction companies still hesitate to adopt ERP systems. This may be due to long-term practiced ad-hoc behaviors in the construction industry, which do not match with the standard procedures embedded in ERP systems. Therefore, through this research, it is expected to evaluate the gap between construction procedures and ERP procedures technically. Hence, to obtain indicative data for the study, a questionnaire was designed and distributed to selected 210 individuals among contractors, subcontractors, and clients in the Sri-Lankan construction industry who have used ERP. In total, 174 completed questionnaires were returned and then statistically analyzed using Chi-Square test with the Mini tab tool. It is concluded that there is a significant gap between the construction procedures and ERP procedures in identified fields related to the construction industry. The highest significant gap exists in the field of Inventory management with Chi-Square 158.766 > 9.48. And HRM (142.366), Asset Management (130.264), Finance Management (126.267), Site Operation (103.793), Project management (53.88), Purchases (34.324), Petty cash (28.337), Estimating and Tendering (22.148), Sub-Contractor management (0.492) respectively. Ultimately with the identified gaps, a framework was established to meet the organizational processes and ERP processes.

Cost estimating of commercial smallsat launch vehicles

Commercial launch service providers’ low-priced offerings have been a hotly debated topic. However, the strategies with which these firms reduce costs have seen little incorporation into the hardware Cost Estimating Methods (CEMs) and tools prevalent in the aerospace industry. This research changes this, by providing adaptations to agency-focused CEMs that befit a new commercial paradigm, with an emphasis on smallsat launch vehicles.A parametric model for estimating costs in an early phase of development was synthesized, with which it is possible to approximate the full life-cycle costs of small commercial liquid and solid propellant rockets, as well as their cost-based price per flight. Key elements included were reductions in cost achieved by commercial launch operators, by modeling reduced subcontractor management effort and profit retention experienced at lower subcontracting rates.Prices per flight of small commercial launch vehicles were approximated by combining a parametric cost estimating methodology used frequently in the context of space agencies such as ESA and NASA, called the T1 Equivalents method, with another parametric three-part estimate developed by Koelle for development, manufacture and operations phase costs. The first two phases were estimated through the T1 method, while the operations costs were modeled with TRANSCOST.Along with the newly developed methodologies, novel insights such as required launch rates have shone a light on small commercial launch systems’ cost feasibility in the age of public-private spaceflight partnerships.The model developed was able to approximate costs of development, manufacture and price per flight of three commercial rockets to within 20% of actual reported costs or prices. However, it is recommended the model is refined as more reference cost data, especially on a subsystem level, as well as pricing for these smaller rockets becomes available in the coming years.

Qualitative study on the control of hazardous energy on machinery using lockout and alternative methods

In Canada, like many countries, the national standard and provincial regulations require that workers performing maintenance, repair, and un-jamming activities on machinery must follow lockout procedures. However, the high number of accidents linked to hazardous energies and machinery shows that organizations have difficulty with the application of lockout arrangements or use of alternative methods. Therefore, it is important to understand how organizations implement lockout programs and procedures, and the extent to which they are in accordance with relevant standards and regulations. In this qualitative research, the application of lockout and alternative methods was studied in 13 organizations in Quebec, through a group interview, document review and site observation in each organization. In each organiztion, the researchers conducted a group interview and completed a questionnaire, which included more than a hundred questions on the lockout program, application of lockout procedures, alternative methods, sub-contractor management, training, and audit/inspection. The researchers then used observation data and documentation collected from each organization to verify interviewee responses and to finalize the questionnaire. The shortcomings found included: (i) incomplete lockout programs; (ii) missing steps in general lockout procedures; (iii) not reading the placards; (iv) using alternative methods without risk assessment; (v) poor training for alternative methods; (vi) absence of supervision and coordination of subcontractors; (vii) and lack of audit tools and documentation of audit results. Despite the shortcomings, actual lockout practices in the organizations visited were better than what was described in their lockout programs. Recommendations for addressing identified shortcomings are proposed.

A Decision-Making Framework for Subcontractor Selection in Construction Projects

Subcontractor (SC) selection is a critical part of SC management, and a major challenge is the existence of multiple criteria that the project management team needs to evaluate in the selection process. To overcome this challenge, the Kano model is applied to classify the selection criteria into five categories including must-be, reverse, one-dimensional, attractive, and indifferent. Data were obtained via a questionnaire based on Kano model concepts to categorize the identified selection criteria. The obtained results show that the selection criteria can be categorized into three categories; must-be, one-dimensional, and attractive. According to this categorization, the weight of criteria is extracted by applying the Analytic Hierarchy Process. Then, a fuzzy multi-attribute decision framework is developed to select the best SC with two main components, screening by the must-be criteria category and selection based on the one-dimensional and attractive criteria categories. A case example of the framework application and the results of a questionnaire are presented and validate acceptance of the framework accuracy.

Minimizing Project Cost by Integrating Subcontractor Selection Decisions with Scheduling

Subcontracting has been a worldwide practice in the construction industry. It enables the construction enterprises to focus on their core competences and, at the same time, it makes complex project possible to be delivered. Since general contractors bear full responsibility for the works carried out by their subcontractors, it is their task and their risk to select a right subcontractor for a particular work. Although subcontractor management has been admitted to significantly affect the construction project’s performance, current practices and past research deal with subcontractor management and scheduling separately. The proposed model aims to support subcontracting decisions by integrating subcontractor selection with scheduling to enable the general contractor to select the optimal combination of subcontractors and own crews for all work packages of the project. The model allows for the interactions between the subcontractors and their impacts on the overall project performance in terms of cost and, indirectly, time and quality. The model is intended to be used at the general contractor’s bid preparation stage. The authors claim that the subcontracting decisions should be taken in a two-stage process. The first stage is a prequalification – provision of a short list of capable and reliable subcontractors; this stage is not the focus of the paper. The resulting pool of available resources is divided into two subsets: subcontractors, and general contractor’s in-house crews. Once it has been defined, the next stage is to assign them to the work packages that, bound by fixed precedence constraints, form the project’s network diagram. Each package is possible to be delivered by the general contractor’s crew or some of the potential subcontractors, at a specific time and cost. Particular crews and subcontractors can be contracted more than one package, but not at the same time. Other constraints include the predefined project completion date (the project is not allowed to take longer) and maximum total value of subcontracted work. The problem is modelled as a mixed binary linear program that minimizes project cost. It can be solved using universal solvers (e.g. LINGO, AIMMS, CPLEX, MATLAB and Optimization Toolbox, etc.). However, developing a dedicated decision-support tool would facilitate practical applications. To illustrate the idea of the model, the authors present a numerical example to find the optimal set of resources allocated to a project.

How and why do subcontractors experience different safety on high-risk work sites?

In high-risk industries such as construction, mining and energy, subcontractors play an increasingly significant role. A typical arrangement is for the site owner to hire a principal contractor who in turn hires multiple subcontractors. This means that multiple subcontractors from multiple companies can be working on the same site at the same time. There is evidence that the use of subcontractors is not only increasing, but that the accident rates for subcontractor employees are higher than those of operator/site owner employees. Existing research on subcontractors, which focuses on the role of the prime contractor in selecting and managing subcontractors, fails to explain why subcontractors continue to experience higher rates of serious injury even where subcontractor management systems are in place. The purpose of this paper is to understand how and why employees of subcontractors’ experience safety differently from employees of principal contractors. The paper does so by extensively reviewing the applicable literature and reporting on a cross-industry focus group study.

A NEW APPROACH FOR SUBCONTRACTOR SELECTION IN THE CONSTRUCTION INDUSTRY BASED ON PORTFOLIO THEORY

Various challenges such as new technologies, growing complexity and competitive environment, require the main contractor to assign some of the project’s tasks to other parties, the so-called subcontractors. Although subcontract­ing is a usual phenomenon in the construction industry, insufficient attention to the subcontractor selection strategy may pose some major threats to a project. Having in mind the significance of such risks, the optimization of subcontractor selection is essential for the success of the project. The importance of risk management in selecting subcontractors and the direct relation between risks and returns in most projects are two main motives for using the concept of portfolio in this paper. The main objective of this paper is to propose a model to allocate the best portion of project’s task to some subcontractors in order to reach the optimized portfolio of subcontractors and main contractor. This is a new approach in the subcontractor management; therefore, after presenting the model, an illustrative example will be presented for better understanding.