Emerald | Journal of Facilities Management

Risk mitigation strategies for guaranteed maximum price and target cost contracts in construction – A factor analysis approach

Joseph H.L. Chan, Daniel W.M. CHAN, Albert P.C. Chan, Patrick T.I. Lam — 2012-02-17 00:00:00.0

Abstract

Purpose - There is a lack of empirical research on risk mitigation strategies for those construction projects procured by guaranteed maximum price contracts (GMP) and target cost contracts (TCC). The paper aims to identify and analyse the risk mitigation strategies for GMP/TCC construction projects from the Hong Kong perspective.Design/methodology/approach - A total of 94 industrial practitioners with both sound knowledge and abundant hands-on experience of the GMP/TCC methodology participated in an industry-wide empirical questionnaire survey to indicate their levels of agreement on those 18 risk mitigation strategies identified from reported literature and in-depth interviews which were later analysed by factor analysis.Findings - The results of factor analysis revealed that the 18 individual risk mitigation strategies can be consolidated into 7 underlying grouped factors: (1) Relational contracting and mutual trust; (2) Clear contract provisions and well-defined scope of works; (3) Involvement of contractor in decision making process; (4) Right selection of project team; (5) Third party review of project design at tender stage; (6) Standard contract clauses for GMP/TCC schemes; and (7) Fair treat of contractor.Research limitations/implications - Although both GMP/TCC contracts have been increasingly popular in the construction market of Hong Kong, not all of these projects have been equally successful and some of them have been exposed to very high risks or uneven allocation of risks. A detailed analysis and an implementation of recommended effective risk mitigation strategies are essential to the success of GMP/TCC schemes.Originality/value - The research findings of this study are expected to help the decision-makers to generate useful insights into risk mitigation strategies when administering GMP/TCC contracts at an early stage of project delivery and lay a solid foundation for further research on GMP/TCC in both local and international context.

A Delphi study on building services engineers’ core competence and statutory role in Hong Kong

Francis W.H. Yik, Joseph H.K. Lai, W.L. Lee, K.T. Chan, C.K. Chau — 2012-02-17 00:00:00.0

Abstract

Purpose - The study aimed to narrow the diverse views of the industry stakeholders on two controversial issues, namely the scope of core competence of building services engineers (BSEs) and the statutory role that they should play, which were encountered in an extensive research study on the building services profession of Hong Kong.Design/methodology/approach - An expert panel was formed and the Delphi method was applied to resolve the controversies. In the Delphi process, every panel member was provided with complete opinions expressed by all other panel members in each round of the deliberation.Findings - Sufficient support was found for the proposition that professional BSEs should be competent in handling air-conditioning, electrical, fire services, and plumbing & drainage works, and that the government authorities should mandate the design and compliance certification of electrical and fire services installations by BSEs. Research limitations/implications - Although the Delphi method has not been hitherto applied to resolve the controversies addressed in the study, it was proven to be a very effective tool in seeking majority opinions from a group of experts. The same approach may be taken in similar studies in future.Practical implications - The core competence identified should be made as a minimum requirement for practitioners who wish to practise as professional BSEs. The views and comments given by the expert panel members are informative references to public policy makers. Originality/value - This was the first ever study conducted in an attempt to identify the core competence and statutory role of BSEs in Hong Kong.

Factors Contributing to Successful Public Private Partnership Projects – Comparing Hong Kong with Australia and the United Kingdom

Esther Cheung, Albert P.C. Chan, Stephen Kajewski — 2012-02-17 00:00:00.0

Abstract

Purpose - With the increasing interest in Public Private Partnership (PPP) there is a need to investigate the factors contributing to successful delivery of PPP projects. Design/methodology/approach - An empirical questionnaire survey was conducted in Hong Kong and Australia. The survey respondents were asked to rate eighteen factors which contribute to delivering successful PPP projects. Findings - The findings from this survey were further compared with the results achieved by a previous researcher (Li, 2003) in a similar survey conducted in the United Kingdom. The comparison showed that amongst the top five success factors ranked by Hong Kong respondents, three were also ranked highly by the Australians and British. These success factors included: ‘Commitment and responsibility of public and private sectors’; ‘Strong and good private consortium’; and ‘Appropriate risk allocation and risk sharing’. Therefore, it can be concluded that there are certain common critical success factors for conducting PPP projects irrespective of the geographical locations. Originality/value - The findings presented in this paper have highlighted those most significant critical success factors which may be applicable to all jurisdictions, and also those which are specifically for Hong Kong and Australia. It is believed that the participants of future PPP projects can use these findings to maximize the success of conducting similar projects.

Developing a heat stress model for construction workers

Albert P.C. Chan, Michael C.H. Yam, Joanne W.Y. Chung, Wen Yi — 2012-02-17 00:00:00.0

Abstract

Purpose - Heat stress, having caused preventable and lamentable deaths, is hazardous to construction workers in the hot and humid summers of Hong Kong. The purpose of this article is to develop a heat stress model, based on the Wet Bulb Globe Temperature (WBGT) index.Design/methodology/approach - Field studies were conducted during the summer time in Hong Kong (July to September 2010). Based upon 281 sets of synchronized meteorological and physiological data collected from construction workers in four different construction sites between July and September 2010, physiological, work–related, environmental and personal parameters were measured to construct and verify the heat stress model.Findings - It is found that drinking habit, age and work duration are the top three significant predictors to determine construction workers’ physiological responses. Other predictors include percentage of body fat, resting heart rate, air pollution index, WBGT, smoking habit, energy consumption, and respiratory exchange rate. The accuracy of the model is verified against data which has not been used in developing the model. The accuracy of the heat stress model is found to be statistically acceptable (Mean Absolute Percentage Error = 5.6%, Theil's U inequality coefficients = 0.003).Practical implications - Based on these findings, appropriate work-rest pattern can be designed to safeguard the well being of workers when working in a hot and humid environment.Originality/value - The model reported in this paper provides a more scientific and reliable prediction of the reality which may benefit the industry to produce solid guidelines for working in hot weather.

Drivers and Barriers of New Product Development and Innovation in Event Venues: A Multiple Case Study

Ahmed Hassanien, Crispin Dale — 2012-02-17 00:00:00.0

Abstract

Purpose - Drawing on existing literature the paper reviews the role of new product development (NPD) in event venue operations. The paper acknowledges product innovation as an under researched field in event venues and explores this within the context of seven diverse operations. Design/methodology/approach - Using a case study analysis methodology the research reveals a number of key findings. Findings - It is revealed that NPD is a fundamental process within event venues but takes a number of different forms depending on the profit or non-profit orientation of the organisation. Within this, the findings discuss the different aims, reasons and barriers of NPD.Originality/value - The paper concludes with the key issues to NPD that managers in event venues should be aware of and proposes a number of limitations and areas for future research.