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Managing Construction Projects Within Budget
- 1. 1 SCHOOL OF ARCHITECTURE, BUILDING AND DESIGN BACHELOR IN QUANTITY SURVEYING (HONOURS) GROUP ASSIGNMENT MANAGEMENT SCIENCE (MGT 60203) KOAY JING TING 0327739 MAURICE WONG BAK WEE 0331860 CH’NG ZUHAO 0327773 CHIA LI YANG 0327014 WAN YEE LEN 0330764 HUE JIA YEEN 0331055 LECTURER: MS TAY SHIR MEN
- 2. 2 Table of Content No Content Pages 1 Cover Sheet 1 2 Table of Content 2 3 TASK 1 1. Company Background 2. Short-term , Mid-term and Long-term goal 3. Organisational Culture 4. Organisation Structure 5. Value Statement 6. SWOT Analysis 7. Strategic Planning 3 – 26 4 TASK 2 1. Selection Criteria 2. Training and Development Courses 3. Management Trainee Selection Process 27 – 34 5 TASK 3 1. Information Technology 2. Information Management Skills 3. Cost Competitive Advantage 35 – 48 6 References 49 – 50
- 3. 3 Company Name PRECISION Construction Sdn Bhd Type of Business Construction Company Capital 1 million Ringgit Location Petaling Jaya, Selangor , Malaysia Vision Be the world’s premier construction company that satisfy customers in term of construction cost, construction time and sense of security Mission To provide quality services and maintain the highest level of professionalism, honesty and fairness in our relationships with our customers, employees and vendors. To grow by continually developing a stress-free environment for the public and also to establish the green building concept in our development projects
- 4. 4 Task 1 Company Background PRECISION Company is a construction company located at Petaling Jaya, Malaysia with 1 million as capital . It is founded on March 2018 . The aims of this company is to provide the best construction services and management services to the industry . The vision of our company is to be the world’s premier construction company that satisfy customers in term of construction cost, construction time and sense of security. ShortTerm Goal: Cooperate with recognised construction company within the country . Receive at least 1 minor and 1 major project . Mid Term Goal: Receive projects which cover at least 5 states in Malaysia. To get recognition within the nation as a trustworthy company To become a listed company Use technology to invent our own innovative system . Long Term Goal: To be a multicultural company . Receive at least 80% of satisfaction rate from our customers. Increase company net worth
- 5. 5 Organisation Culture Organisation culture, simply speaking, refers to all the values and behaviours that create the unique environment. When we allude to the company, we may call it ‘company culture’. It also can be defined as ‘the way things get done around here’. In PRECISION company, we seek to promote our employees to embody our company values and build a strong relationship between each other in the company. As we want to develop our employees to feel safe and comfortable with their working environment as we believe by using this method, employees would be more productive and effective while doing and producing their work. Besides, once the bonding is strong, employees are also able to perform better and work together to achieve the company’s goal. Employees must always remember that teamwork is important on all work- related projects and they need to help each other where necessary. It doesn’t matter who gets credit for what because you accomplish everything together. Employees must remember they are knit together, not separated. Apart from that, PRECISION Company provides an open environment which leads to a greater job satisfaction, reduced stress, increased commitment, team building and loyalty to the organization. PRECISION company utilizes the open space concept by removing restricted cubicles to obtain open spaces for the employee to communicate and socialize. This allows them to be more interactive and encourage more group discussion with one and another. A weekly team gathering and boding night is prepared for all the employees to hand out and interact with other department so that they can have strong bonding with their colleagues and break their barrier with each other, indirectly enhancing their efficiency and transparency between each other in the company. PRECISION Company also focuses on the performance of employee. In order to achieve it, company will provide awards and achievement based on group achievements rather than individual achievement since our company is promoting in strong team relationship and enhancing group work. By this method, employees can be more cooperative and be highly achievement driven and thus improving overall productivity and efficiency in doing work. These are done to adopt the open concept as PRECISION aim to flatten the organizational structure, while promoting strong communication between every department in the company. It allows all employees to communicate and approach each other easily and allowing employees to monitor other’s progress. Hence, by applying all these organizational cultures, it is more likely to achieve our vision, mission and goals in PRECISION.
- 6. 6 Organisation Structure Organizational structure helps a company assign a hierarchy that defines roles, responsibility, and supervision. It's the plan that outlines who reports to whom and who is responsible for what. It's usually recorded and shared as an organizational chart that includes job titles and the reporting structure. Board of Directors Project Department Site Engineer Safety Supervisor Quanriry Surveyor Civil Construction Supervisor Engineer Department Structural Engineer Planning Engineer Purchasing Department Purchasing Manager Marketing Department Advertising Manager Public Relations Manager Sales Manager Financial Department Budget Manager Accountant Human Resouce Department Training Coordinator Human Resource Manager Personnel Coordinator ITDepartment ITManager General Manager
- 7. 7 Project Department The project department is part of an organizational unit that supports the management of projects and project-based organizations. Their responsibilities include determining, controlling, and maintaining the standards and processes related to project management within a company or organization. Furthermore, they strive to standardize and introduce economies of repetition in the execution of projects. Site Engineer Site Engineer offers advice in the planning, coordination and supervision of technical aspects of construction projects. The responsibilities include solving technical issues, providing advice, management and preparing reports. Therefore, a site engineer’s role is vital to a construction project. Managing parts of construction projects Overseeing building work Undertaking surveys Setting out sites and organizing facilities Checking technical designs and drawings to ensure that they are correctly followed Supervising contracted staff Making sure that projects meet agreed specifications, budgets or timescales Liaising with clients, subcontractors and other professional staffs, especially quantity surveyors and the overall project manager Providing technical advices and solving problems on site Preparing site reports and filling in other paperwork Liaising with quantity surveyors about the ordering and negotiating the price of materials Ensuring that the health and safety and sustainability policies and legislation are adhered to
- 8. 8 Quantity Surveyor Quantity Surveyors are responsible for managing all aspects of the contractual and financial side of construction projects. They help to ensure that the construction project is completed within its projected budget. Alternative job titles for quantity surveyor include ‘cost consultant’, ‘commercial manager’, ‘cost manager’ and ‘cost engineer’. Pricing or forecasting the cost of the different materials needed for the project Preparing tender documents, contracts, budgets, bills of quantities and other documentation Tracking changes to the design and/or construction work and adjusting budget projections accordingly Procuring or agreeing the services of contractors and/or subcontractors who work on the construction of the project Measuring and valuing the work done on site Paying subcontractors Liaising with clients and other construction professionals, such as site managers, project managers and site engineers Selecting and/or sourcing construction materials Writing reports ProjectManager Project managers are responsible for the planning, management, coordination and financial control of a project. They ensure that a project is completed on time and within budget, that the project’s objectives are met and that everyone else is doing their job properly. Besides that, they also oversee the project to ensure the desired result is achieve, the most efficient resources are used and the different interests involved are satisfied. Agreeing to the objectives of projects Representing the client’s or organization’s interests Providing advice on the management of projects Organizing the various professions working on a project Carrying out the assessment of risks Ensuring that all the aims of the project are met Ensuring the quality standards are met Keeping track of people and progresses using IT or other systems Recruiting specialists and subcontractors Monitoring subcontractors to ensure guidelines are maintained Overseeing the accounting, costing and billing Reporting to the client or senior stakeholders on the progress Evaluating the success of the project against its benchmarking and sharing lessons or best practice with other organizations or project managers
- 9. 9 Civil Construction Supervisor Monitors ongoing construction to ensure that the work is being done correctly and the project stays on schedule. Job focuses on civil construction projects such as bridges, highways and airports Must be familiar with the construction and material specifications for the infrastructure be able to analyse the project’s design and plan ahead for the safety of workers and members of the public who will be using the facility for decades to come establish the job schedule, which includes setting completion goals for subcontractors and delivery dates for materials schedule must be coordinated with the maturity dates of municipal bonds that proved the financing once schedule been finalized, supervisor will distribute copies to all parties involved with the job supervisor must visit the work site daily and speak to managers, workers and vendors to prevent miscommunication and resolve issues. This helps all parties stay updated on any changes to the plans and stick to the schedule as the project progresses Monitoring the job’s progress daily helps the supervisor spot problems quickly and contact the subcontractor or vendor to correct the issue immediately This prevents a small problem from escalating into a large budget overrun Civil projects are subject to greater scrutiny (observation) than private jobs because they generally use public money to fund construction This requires the supervisor to constantly monitor the use of employees, materials, funds and other resources to eliminate wastefulness Supervisor should watch the material inventory to see if any are being used faster than expected If an unusual usage rate is detected, the supervisor can order more material to keep up with the need or analyse the construction process to look for inefficiencies
- 10. 10 Safety SupervisorDuties Supervisors are responsible for a great deal of what goes on day to day in the workplace; it's not just a position that solely assigns tasks. Supervisors must ensure a safe and healthful workplace for employees. Employees must be able to report unsafe or unhealthful workplace conditions or hazards to a supervisor without fear of reprisal. Supervises day-to-day activities within a particular construction workplace Ensures that workers make use of necessary protective equipment like helmets, hand gloves, welding shades etc Investigates accidents and tackle their causes Takes note of workers’ safety concerns and immediately acts on them Arranges training programs on safety measures within the workplace Develops plans for emergency procedures with the consent of the manager of the workplace Receives and acts on reports regarding safety concerns from workers within the construction site/workplace Serves as a link between workers and top management when it comes to issues that have to do with the safety and proper organization of the workplace Introduces measure that will help curb accidents within the workplace
- 11. 11 Engineer Department Engineering Department plays an important role for planning of the construction project. Engineer managers are responsible for leading and supervising a group of professional engineers to develop investigations and identify solutions for technical issues faced during handling civil project. They also leads the activities of a engineering and design office in contract renewals, the design or improvement of services, products, equipment or industrial processes, guaranteeing operational performance in monitoring operational standards and contract reviews and answering calls for tender. StructuralEngineer Structural Engineer is an engineer which focuses on the design and development of infrastructure such as bridges, skyscrapers, dams and buildings. They are more concerned with the design and physical integrity of building and large structures. Unlike architects, who must focus on the appearance, shape, size and use of the building, structural engineers must solve technical problem and help the architect achieve his or her vision for the project. They are also asked to leverage their creativity and critical thinking skills in developing innovation solutions to allow construction in challenging conditions. Administer all engineering activities for medium to large civil projects and supervise efficient working of manpower and financial investments. Assists all design personnel and engineers in various quality improvement processes and provide consultations to departments on all technical aspect and perform regular analysis on same. Prepare design according to applicable codes and regulations and ensure signature on all civil contracts and design all equipment specification for projects and evaluate all supplier data and perform appropriate test. Maintain knowledge on all technologies and establish budget and staffing requirements for all projects as per schedule. Engineers may be responsible for ensuring the infrastructures are aesthetically pleasing or easily recognizable, especially for commercial buildings. Maintain and update knowledge on various civil engineering processes with the help of various techniques and coordinate with various departments for all technical activities of project.
- 12. 12 Planning Engineer Planning Engineer determines and develop the most suitable and economically variable construction and engineering methods for all projects. They are involved throughout the development stages, and are present on site during the build to oversee procedures. It is the responsibility of the planning engineer to estimate a timescale for a project and to ensure that the outlined deadlines are met. They work closely with site managers and other engineers to ensure that a project runs on schedule and the material supplies are always sufficient. Deciding on the most appropriate engineering techniques and sequences of activities for each project stage. Drawing plans using specialised design software packages. Ensuring plans meet the client’s specifications Making estimations for timescales and costs. Supervising the project at all stages and providing solutions to problems. Collaborating with site managers, surveyors, engineers, site worker and other professionals. Report on the data quality and quantity and constantly look for means by which data Quality maintained at high standards. Prepare and always update the project schedule based on the contract. Monitor critical activities based on the project schedule and advise project management. Participate in project meetings and discussions with the client as required.
- 13. 13 Purchasing Department The purchasing department develops and maintains relationships with subcontractors and suppliers. This includes evaluating subcontractor qualifications and financial capabilities. The purchasing department generally prepares, negotiates and awards all subcontracts, and purchase orders. Purchasing department’s main role is purchasing supplies and materials used in the projects and company daily needs. They need to compare among different suppliers and finding the items with correct prices and qualities. Purchasing Manager Purchasing managers are responsible for buying the best quality equipment, goods and services, at the most competitive prices, to enable a company or organisation to operate. They work in a range of sectors for many different organisations, often overseeing supply chain management and procurement, sometimes on a worldwide scale. Through effective negotiation, networking and dealing with numbers, purchasing managers can help a business or organisation save money and increase profits. They also deal with other factors such as sustainability, risk management and ethical issues. Deciding what goods, services and equipment are needed Keeping on eye on stock levels Researching and identifying new products and suppliers Weighing up tenders from potential suppliers. Ensuring that suppliers deliver on time, payments and invoices are processed and that the company keeps up with market trends Negotiating, networking, working with figures and making good financial decisions. Forecast levels of demand for services and products. Evaluate bids and make recommendations, based on commercial and technical factors. Give presentations about market analysis and possible growth Build and maintain good relationships with new and existing suppliers. Forecast price trends and their impact on future activities. Developing a purchasing strategy. Conduct research to ascertain the best products and suppliers in term of best value, delivery schedules and quality.
- 14. 14 Marketing Department The marketing department is responsible for conducting market research about consumer requirements, habits, and trends and to develop ideas to promote the product to the public. Advertising Manager Advertising managers plan and directs the promotional and advertising campaigns of companies in order to generate interest in a product. Work with department heads or staff to discuss topics such as contracts, selection of advertising media, or products to be advertised Gather and organize information to plan advertising campaigns Plan the advertising, including which media to advertise in, such as radio, television, print, online, and billboards Negotiate advertising contracts Inspect layouts, which are sketches or plans for an advertisement Initiate market research studies and analyse their findings Develop pricing strategies for products to be marketed, balancing the goals of a firm with customer satisfaction Meet with clients to provide marketing or technical advice Direct the hiring of advertising, promotions, and marketing staff and oversee their daily activities Public Relations Manager Public Relations departments utilize traditional and online marketing tools not to sell a product, but rather to enhance their visibility and influence upon the public, investors, employees, business affiliates, and the media. Develop and maintain the company's corporate image and identity, which includes the use of logos and signage Draft speeches for company executives and arrange interviews and other forms of contact for them. Evaluate advertising and promotion programs for compatibility with public relations efforts. Identify main client groups and audiences, determine the best way to communicate publicity information to them, and develop and implement a communication plan. Establish and maintain effective working relationships with clients, government officials, and media representatives and use these relationships to develop new business opportunities.
- 15. 15 Sales Managers Sales managers work with the sales team to develop strategies and set goals for selling the company’s products or services. Achieve growth and hit sales targets by successfully managing the sales team Design and implement a strategic business plan that expands company’s customer base and ensure its strong presence Own recruiting, objectives setting, coaching and performance monitoring of sales representatives Build and promote strong, long-lasting customer relationships by partnering with them and understanding their needs Present sales, revenue and expenses reports and realistic forecasts to the management team Identify emerging markets and market shifts while being fully aware of new products and competition status
- 16. 16 Financial Department The financial department is responsible for management of the company’s cash flow and ensuring there are sufficient funds available to meet the day to day payments. BudgetManager Budget managers evaluate the financial needs of an organization, developing budget strategies to increase the company’s profitability. They design and implement the company’s financial plans to comply with legislation and ensure business growth. The role involves preparing budget reports, presenting recommendations to executives, and monitoring expenditure. Work with program and project managers to develop the organization's budget Review managers' budget proposals for completeness, accuracy, and compliance with laws and other regulations Combine all the program and department budgets together into a consolidated organizational budget and review all funding requests for merit Explain their recommendations for funding requests to others in the organization, legislators, and the public Help the chief operations officer, agency head, or other top managers analyse proposed plans and find alternatives if the projected results are unsatisfactory Monitor organizational spending to ensure that it is within budget Inform program managers of the status and availability of funds Estimate future financial needs Accountant Accountants are employed by organisations or private clients to audit accounts, provide financial advice and undertake accounts administration. Preparing accounts and tax returns Administering payrolls and controlling income and expenditure Compiling and presenting reports, budgets, business plans, commentaries and financial statements Analysing accounts and business plans Providing tax planning services with reference to current legislation Authorize the transfer of expenses into and out of project-related accounts Review and approve supplier invoices related to a project Report to management on any opportunities for additional billings Report to management regarding the remaining funding available for projects Create or approve all project-related billings to customers Investigate all project expenses not billed to customers Create and submit government reports and tax returns related to projects Compile information for internal and external auditors, as required
- 17. 17 Human Resource Deparment The human resource department is a critical component of employee well-being in a company or organization. The responsibilities include payroll, benefits, hiring, firing, and keeping up to date with state and federal tax laws. It also includes the entire spectrum of creating, managing, and cultivating the employer-employee relationship. An efficiently run human resources department can provide the company or organization with structure and the ability to meet business needs. PersonnelCoordinator Personnel Coordinators are responsible for performing human resources related functions to include recruitment and selection; processing the department’s payroll as well as maintaining related payroll and personnel records. Compiles departmental payroll based on information received from individual division to include regular and overtime hours worked and various types of leave taken Initiates approvals for and monitoring of leave under the Family Medical leave Act (FMLA) Computes salary changes or salary adjustments and retroactive pay according to established policies and procedures Maintains personnel files for attendance, leave time, and payroll vouchers Monitors supplemental pay to ensure accuracy and compliance with established policy Responds to inquiries regarding pay practices and policies Assists with the employment process, including posting requisitions, scheduling interviews, preparing interview packages for interview panel, reviewing selection packages, and coordinating the background check process. Processes payment of bills; verifies totals, tracks, and enters receipts and payments of bills in database software
- 18. 18 Training Coordinator The training coordinator is a human resource specialist who implements talent development solutions. In this role, you assess staff needs, assist with the design of training materials, coordinate the delivery of training programs, and monitor the results. In addition, you are often responsible for administrative tasks relating to training technology, internal consulting about training, project management, and working with outside vendors. Map out annual training plans for management, HR, customer support and more Design and develop training programs (outsourced and/or in-house) Select appropriate training methods or activities (e.g. simulations, mentoring, on-the-job training, professional development classes) Market available training to employees and provide necessary information about sessions Conduct organization-wide training needs assessment and identify skills or knowledge gaps that need to be addressed Use known education principles and stay up-to-date on new training methods and techniques Design, prepare and order educational aids and materials Assess instructional effectiveness and determine the impact of training on employee skills and KPIs Gather feedback from trainers and trainees after each educational session Partner with internal stakeholders and liaise with experts regarding instructional design Maintain updated curriculum database and training records Host train-the-trainer sessions for internal subject matter experts Manage and maintain in-house training facilities and equipment
- 19. 19 Human Resource Manager Human resource managers are the overseers of the human resources department and insurers of the functions and tasks being carried out by the HR team. They are often seen as the link between an organization’s management and its employees, as their work runs the gamut from providing consultation on strategic planning with top executives to recruiting, interviewing, and hiring new staff. As such, HR managers are the professionals responsible for attracting, motivating, and retaining the most qualified talent by directing the administrative functions of the HR department. Due to the supervisory nature of this position, human resource managers are called upon to handle employee-related services, regulatory compliance, and employee relations, among many other tasks. Develop and implement HR strategies and initiatives aligned with the overall business strategy Bridge management and employee relations by addressing demands, grievances or other issues Manage the recruitment and selection process Support current and future business needs through the development, engagement, motivation and preservation of human capital Develop and monitor overall HR strategies, systems, tactics and procedures across the organization Nurture a positive working environment Oversee and manage a performance appraisal system that drives high performance Maintain pay plan and benefits program Assess training needs to apply and monitor training programs Report to management and provide decision support through HR metrics Ensure legal compliance throughout human resource management
- 20. 20 IT Department IT Manager Responsible and accountable for the smooth running of our computer systems within the limits of requirements, specifications, costs and timelines. Manage information technology and computer systems Plan, organize, control and evaluate IT and electronic data operations Manage IT staff by recruiting, training and coaching employees, communicating job expectations and appraising their performance Design, develop, implement and coordinate systems, policies and procedures Ensure security of data, network access and backup systems Act in alignment with user needs and system functionality to contribute to organizational policy Identify problematic areas and implement strategic solutions in time Audit systems and assess their outcomes Preserve assets, information security and control structures Handle annual budget and ensure cost effectiveness
- 21. 21 Value Statement PRECISION P : Passion. We are passionate on what we do and passionate to satisfy the customers needs . R : Relationships. We build long term relationships with our customers , partners , subcontractors and suppliers that are built with trust and respects . E : Efficiency We produce work in the shortest period and we prioritise efficiency and effectiveness . C : Consistency We provide consistent result and services to our customers. I : Integrity We will ensure honestly and fairness in all our actions S : Sustainability We improve the quality of life in communities where we work by respecting local cultures and engaging local people. I : Innovation We always try to produce something out of the ordinary which can helps to improve the construction field. O: Open-mindedness We actively build a diverse and inclusive collaborative environment and welcomed opinions and views from everyone N : Nimble We will always solve problems that occur.
- 22. 22 SWOT Analysis Strength - Strong project management skills - Have at least 5 years of working experinece - Have connections with the construction market Weakness - Is a new company - Lack of employee - Traget audience is not clear Opportunities - Government currently investing in construction sector hence , creating more projects to be taken - The trend of Green Builidng in the market Threats - Not able to compete with the well known construction company - Economy are down - More smaller projects compared to bigger projects
- 23. 23 Strategic Planning Strategic planning is an organizational management activity that us used to set priorities, focus energy and resources, strengthen operations, ensure that employees and other stakeholders are working toward common goals, establish agreement around intended outcomes, and assess and adjust the organization’s direction in response to a changing environment. It normally initiates or originates at the highest level of the organization and focuses on enhancing the competitive positionand overall performance of the organization in long term. It is important for PRECISION Company to have their proper strategic planning so that to establish an overall direction for organization future and what to contribute to reach goals. 1. Strategic Analysis In this step, we need to determine where the company are now and where the company want to go as well as how to get there. These are the essential questions that need to be answered for strategic planning. Hence strategic analysis is needed to be carried out to understand the current position of the organization so its strategy for moving the organization forward can be developed. There are few important components of strategic analysis which are a. An assessment of the organization’s vision, mission and values. In order to know what is the goal of PRECISION (where you want to go), PRECISION should know their own vision, mission and values. Vision is a general statement of on organization’s intended direction that evokes emotional feelings in its members. It can be considered a dream or a very long term goal of PRECISION which lead the company to achieve all their short term goals and midterm goals. For example, PRECISION’s vision is to be the world’s premier construction company that satisfy customers in term of construction cost, construction time and sense of security. Mission statement is a statement that broadly outlines the enterprise’s purpose and serves to communicate who the organization is, what it does, and where it is headed. It is the fundamental reason the organization exists. Mission statements are usually crafted by owners, top managers and the board of directors. A good mission statements provides a strategic direction for employees and focuses directions on the organization’s basic charge. In a mission statement, there are three primary questions should be answered 1. Who will the organization serve(type of client can be determined through market segmentation) 2. What needs will the organization fulfill? 3. How will the organization fulfill those needs? In PRECISION, the mission statement is that to provide quality services and maintain the highest level of professionalism, honesty and fairness in our relationship with our customers, employees and vendors.
- 24. 24 Values statement reflect the core ethical beliefs or standards that exist within an organization. b. An assessment of the organization’s internal environment and external environment that impact the strategy of the organization. SWOT analysis is carried out by PRECISION in order to identify the strengths, weaknesses, opportunities and threats of an organizations. An internal analysis focuses on identifying the assets, resources, skills and processes that represent either a strength or weakness for an organization. Internal analysis is carried out by PRECISION to know the strength and weakness of itself. PRECISION will identify it internal capabilities (what is the company good in) so that can reach the goals of the company. Besides, PRECISION also identify it weaknesses (something you are lack of in competing) of itself. The strength of the company can be the core competency that bring competitive advantages to PRECISION In order to achieve the goals. Core competency is a unique ability or strength of an organization, enable to compete more effectively than others in the same industry, PRECISION is trying to create a sustainable competitive advantage which is difficult for competitors to duplicate. For example, there are a lot of competitive advantages in PRECISION such as usage of a lot of IT (Information Technology) in construction field such as BIM, CAD, and mobile apps (PRECISION CON). An external analysis is carried out by PRECISION to identify the opportunity and threat surrounded them. An opportunity exists when an environmental condition or trend is favorable for the organization and a threat arises when an environmental condition or trend is unfavorable.
- 25. 25 There are few environments need to consider by PRECISION which are Economic Environment, Sociocultural Environment, Technological Environment and Political-Legal Environment so that PRECISION can identify which opportunity can be captured which is good for the future of company. Performing a SWOT analysis can be extremely valuable for an organization. It provides an understandable visual depiction of the environmental factors an organization faces. 2. Strategic Formulation Once the strategic analysis has been completed, PRECISION is ready to formulate strategy. There are three levels of strategy formulation: a. Corporate-Level Strategy Highest level of strategy formulation and it answers the questions’ ‘what business should we be in’’. This applies to very large organizations that participate in multiple business lines. The purpose of corporate level strategy is to diversify an organization’s operations. Diversification occurs when an organization adds a new business unit to its portfolio of the businesses. Diversification hedges organizational risk because the more areas an organization involves itself in, the less it relies on the profitability of any single business. b. Business-Level Strategy Once PRECISION has determined its portfolio of business, it must determine how to run each individual business in the portfolio. Business strategy has a more specific focus than corporate strategy. It focuses on how each business unit within the organization’s corporate portfolio is to operate in its respective market. The aim of strategic planning at the business level is to develop a strategy that gives the company a competitive advantage and leads to organizational success. c. Functional-Level Strategy Once corporate and business strategies have been developed, organizations must plan at the function level. Functional level strategy specifies the production, research and development, financial, human resource management and marketing activities necessary to implement the organization’s corporate and business strategies.
- 26. 26 3. Strategic Implementation PRECISION need to ensure that it strategic is put into action in order to achieve the best results from its strategic planning efforts. Strategy implementation is the execution of the organization’s strategy. It involves aligning the organization’s people and processes to fulfil its mission and achieve its vision. Organization that achieve strategic success commit a tremendous amount of time, energy and effort to making sure that the strategy is implemented effectively. First, PRECISION must have appropriate human resource in place to execute on its strategy. Second, PRECISION must ensure that their strategy is being communicated effectively to employees. Finally, evaluation and reward systems must be structured to motivate the activities necessary to implement the strategy of the organization. 4. Evaluation and Control In this phase of process, managers evaluate what strategic have and have not worked to guide PRECISION towards it mission. PRECISION should develop multiple control system to meet specific strategic needs. Check through if there are any problem encountered as there is always a room for improvement no matter if we fail or how successful we are. For positive outcomes, PRECISION need to be controlled further and monitored to maintain and improve them. Negative outcome will be assessed and corrected or it will indicate if appropriate action should be taken to correct it.
- 27. 27 Task 2 Selection criteria Candidates must have Bachelor’s degree of ALL disciplines from an accredited university with a minimum of CGPA 3.3 or equivalent. Candidates must major in Civil engineering, Quantity surveying, Construction management, Property valuation, Real estate, Business administration or Accounting and Finance. Fresh graduates or those with less than one year working experience are welcome to apply. Proficient in spoken and written English and Bahasa Malaysia. Ability to communicate in Chinese is an added advantage. Have good interpersonal skills and diplomacy to be able to deal with people tactfully. Persuasive and have confidence in decision-making, as well as excellent communication skills to express directions clearly. Have positive attitude such as resilience and calm attitude under pressure are essential. Good organisation and time management skills Candidates who are commercially aware and customer focused
- 28. 28 Training and Development Courses GeneralContracting Manager’sSeminars PrecisionConstruction’s Manager’s Seminars are a two-day seminar that is scheduled twice a year for our project managers, estimators, and field superintendents. These seminars provide comprehensive training sessions to assist all levels of supervision to teach new construction methods and reinforce company processes. They also provide for an exchange of ideas among personnel with similar responsibilities. EPA’s Lead-Safe RenovationCertification Our managers receive training and are certified by EPA-approved training providers on the EPA's Lead Renovation, Repair and Painting Rule (RRP Rule) to follow lead- safe work practices on renovation construction projects. Job Trainingand Mentorship We want to help new our managers and craft workers succeed so we offer extensive on-the-job training and assistance through mentorship. A significant component of the training includes matching our new employee with a mentor. Our seasoned supervisors provide assistance and guidance during the new employee’s transition into our culture and helps contribute to their growth and development. Apprentice Training Our apprenticeship program is available for dedicated journeymen who express an interest in formal construction training. Precision Construction will assist employees in getting enrolled and pay the cost of classroom instruction, provide supervision/instruction in the field, and provide a safe and paid work environment to apply learned skills. Safety Seminars & ConferenceCalls We are committed to educating our employees on new safety policies and practices. Safety seminars are held annually at each office location to familiarize our employees with the company's current safety issues and new policies. Jobsite managers also participate in a monthly conference call to ensure our true Safety culture is communicated and understood. LEED Accreditation /Sustainability Training We train and prepare our employees to become LEED Accredited Professionals. We encourage our managers to receive green building education so they have the key technical knowledge and experience to contribute to a project becoming LEED- Certified.
- 29. 29 Management Trainee Selection Process We recruit professional and fresh graduates through our training programme that aims to identify potential to develop and train talents to becoming future leaders of our organisation, industry and nation. Candidates would have to go through our 3 part interview: Individual Interview Case Study Group Assessment Individual Interview If the candidate meets the selection criteria, they would called in for an interview to assess their views and work ethics. Candidates’ verbal and non-verbal motions would be assessed when answering the questions including body language. Candidates will be assessed by 3 Human Resource Officers. Interview QuestionList “What do you do when you know your boss is wrong?” or “If you know your boss is 100 percent wrong about something, how would you handle this?” Candidates will be asked with this question to see how they deal with a difficult situation or if they have had difficulty working with a manager. It will also identify how they view their relationship with their boss. This is one of those questions that should be answered carefully as interview questions about bosses can be tricky. Candidates are anticipated to demonstrate their tactfulness when dealing with their boss, but also wanting to show that they know when to point out someone’s errors. Answer given by one candidate: Occasionally in the past, I have spoken to a boss about an error, but only when I thought the error would negatively impact the company. For example, a former boss instituted a new online storage system and was unaware that the system was not easily accessible on employee computers. During her daily “open office hours”, I privately discussed the issue with my boss and pointed out the effect these problems had on our ability to complete assigned tasks. She was so glad I brought the issue to her attention that she put me in charge of a task force that solved the error, resulting in increased productivity for all employees.
- 30. 30 “Do you take work home with you?” This tricky question is being asked for a variety of reasons. The answer to this question can reveal whether the candidates are organized can do all of their work in the allotted time. Besides that, this will also help to make sure that candidates are able to maintain a decent work-life balance, which we believe will ultimately make them a happier, and thus better, employee. However, we are also looking for people who make work the centre of their lives, and want to assess just how dedicated to the job they will be. Answer given by one candidate: When I need to, bringing work home with me is not a problem. I realize the importance of meeting deadlines and getting work done on time, and sometimes that requires extra hours in the office or at home. I am extremely organized and skilled at budgeting my time. When I begin a project, I create a timeline for myself that allows me to complete the assignment in a timely manner without taking my work home. However, I understand that sometimes timeline changes or issues come up, and I am always willing to take work home with me when that happens. When I begin a new project, I often choose to take work home with me in order to ensure that I complete the project for my client on time. However, maintaining regular time to spend with my family is very important to me, so I try to limit this to the early stages of projects and to urgent matters. “If you were an animal, which one would you be and why?” This random curveball will shake the candidates out of their comfort zone and call for some imagination and quick thinking. Beyond offering a chance for some light-hearted humour and creativity, this may represent on more way that we try to gauge the candidates’ cultural fit. Through this question, we seek for candidates to show their personality as this is an opportunity to spark a connection and say something memorable. Answer given by one candidate: I’d be an elephant. They are smart, loyal, and work well in groups. Plus, the elephant was my beloved college mascot. “Would you rather be liked or feared?” While this could be considered a character question, the fact that it is almost a deliberate trick question means it could be considered in the curveball bracket. Candidates may have been presented with a straight choice, but there is an unspoken option waiting for them to take full advantage of. A best answer is where candidates are able to acknowledge the original framing of the question, but explain why it would be impossible for them to choose from what’s on the table. Then offer a third, alternative answer. Answer given by one candidate: Well I certainly wouldn’t want to be feared. Personally, I think fear is a terrible motivator, and could lead to some uncomfortable situations. Everyone wants to be liked, but it isn’t always possible. Sometimes you have to do unpopular things to get the job done. I’d much sooner be respected, but have my co- workers understand that I always do my best for the team as a whole.
- 31. 31 “Is it better to be perfect and late, or good and on time?” Half the battle of working is knowing when to stop. One could have done the best outcome or work, but even one missed deadline will make that null and void. The ideal answer is good and on time because, according to Nadia Geller, “Perfection is not attainable. And if you’re late on top of it, people are waiting on you. And that’s a no- no.” (Jacobson, 2017) It is better to hire someone that knows when to throw in the towel because turning in something late makes even the greatest work simply not good enough. However, the best candidates will be the ones that go down the “It depends route”. Answer given by one candidate: Depends on the context. When I was still studying, my university docks 10% for every day an assignment is late. If I were to have an 87% paper and hand it on time, it is better than a 100% paper 2 days late. On the other hand, if a patient requires an immediate life saving surgery, then it is better to have a good surgeon immediately than the best surgeon in an hour. Another example, if you’re going to a party, it is better to be dressed nice, be more prepared, do your hair, remember to bring whatever you needed to bring and be late than be 30 minutes early and just good. As you can see, it clearly depends on the context.
- 32. 32 Case Study Candidates would be given a situation where they would be likely to face for the job they are applying for and the candidate would need to respond with advice to solve the problem. This case study would test the candidates’ analysis, creativity, problem-solving skills, knowledge on the company and world trends for the position they are applying for. Candidates would need to be able to identify the problem, and justify and defend the decisions they decide to take. Candidates are required to read all instructions and materials before starting, to understand what's expected of them. The candidates would be given scenarios that fits their job scope. Short examples of questions that could be asked: Project Manager You, the Project Manager, was unaware that a new safety checks contractor had been appointed and the company you work for has allowed construction work to continue despite the lack of weekly safety checks. The new contractor, Y, has stated that it cannot perform the safety checks for all of the sites for which it has contracted to undertake. Y has forecast a further 4-week delay due to insufficient staffing. What would you, the Project Manager, do? IT This is a potentially huge problem as a software is used throughout the company on all projects. The data contained in the software must be accurate and sound as Project Managers are reliant on the software to monitor and control all construction projects. The integrity of such a crucial IT system must not be compromised. The problem with the software is that there seem to be concerns over changes in some data and the integrity of the information contained in the software following the software upgrade. Software Company X has now admitted that it is experiencing problems with the new software release which has affected the company you work for as well as some of Software Company X other customers. What would you do? Finance The unfinished housing development which the company you work for had won a contract for but the client had subsequently gone into liquidation. The company’s management needs to decide whether or not to make a bid to acquire the unfinished housing development or accept a forecast payment from the liquidators of only 10% of the amount claimed by the company
- 33. 33 Group Assessment Building a newspapertower activity This is to determine the candidate’s soft skills like their ability to communicate and solve problems on the spot and to ensure that the candidates is able to show effective team work. This would also show how the candidates would react under pressure when a problem arises halfway through the activity. As part of the group activity, the candidates would be building the tallest newspaper tower and placing an egg on top of it without it collapsing. How to conduct the activity. 1. Groups of 4-5 people will be formed. 2. Each team will be given the same amount of newspaper, tape, scissors and egg. 3. Each team will be given 50 minutes to plan and build a free-standing newspaper tower with only the things provided. The egg has to be place on top of the structure without it collapsing. 4. After 30 minutes, the person leading will be blindfolded and the person who is doing the most work hand’s would be tied and would not be allowed to touch the tower. The person blindfolded and the person with their hands tied are still allowed to give instructions. 5. At the end of 50 minutes, each team will give a pitch about their ideas about how the structure was created. Then the structures would be measured and the egg would be placed at the top to see if the tower can withstand the weight of the egg. During the activity, there will be 2 observes allocated in every group. The observers will assess the candidates’ working behaviour based the assessment scoreboard.
- 34. 34 Expectations towards Candidates Assessment Rating CommentsNon- existent Slightly Average Often Existent Leadership Able to show some form of leadership qualities when the situation arises Communication Able to communicate ideas well to others and listen to others ideas Teamwork Able to work well as a individually and in a team Planning Have time management skills, able to prioritize, multitask Problem Solving & Decision Making Able to think and decide fast on a suitable course of action to attain the goal Initiative & Drive Takes initiative and has the drive to attain the goal
- 35. 35 Task 3 Introduction The main challenge for business strategy is to find a way of achieving a sustainable competitive advantage over the other competing products and firms in a market. A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices. Hence every society must hold at least one advantage to successfully compete in current market place because if a company cannot identify one or just does not possess it, competitors soon will outperform it and force the business to leave the market. There are seven ways companies can define their competitive advantages. (Garfinkle) 1. Cost Leadership Strategy Companies may place themselves a head of the pack by offering attractive pricing For example, Wal-Mart and Amazon are two companies that have risen to the fore front by this strategy. PRECISION construction Sdn Bhd can offer a cheaper construction cost to their client with guaranteed of good quality and services to attract their client. 2. Differentiation Strategy Branding is likely the most widely used method to differentiate one company from another. With this method, PRECISION construction Sdn Bhd will automatically assume a status of distinct and apart from all other construction company 3. Innovative strategy PRECISION construction Sdn Bhd may move ahead of the competition by doing things in new and different ways. 4. OperationalEffectiveness Strategy PRECISION construction Sdn Bhd tries to do well and better than other else construction company in construction field. When you do what you do very well, in this case if Precision company perform well in constructing projects by ensuring good quality and safety, it will gain a competitive advantage over other competitors.
- 36. 36 5. Technology BasedCompetitiveStrategy PRECISION construction Sdn Bhd has sought for a competitive edge using new technology or technology in a new way. They embrace new technology and learn to master it nearly always redefine or increase their competitive advantage over those who resist new methods. 6. Adaptability Competitive Advantage As markets, economies and other factors change in this increasingly unstable and unpredictable environment, companies that can adapt have a distinct advantage. 7. The InformationAdvantage Almost all the other strategies benefit from excellent information. The definition of competitive advantage is the skills needed to outplace your rivals. Most of those come through knowledge and information. Successful companies seek the latest in technology, strategies and data.
- 37. 37 Information Technology (IT) Information technology (IT) refers to a wide variety of items and abilities used in the creation, storage and dispersal of data and information as well as in the creation of knowledge. As new technologies evolve and existing technology are expanding, the interaction between people and computers are turning apace and this result many impacts on organizations and society. Basically, the role of IT is to monitor process and circulate data to assist in managing, checking and building determinations for the governing body. IT is a critical requirement for improving the way to manage and run the organizations. The construction industry may sound remotely related to information technology but it has an affinity to IT solutions, especially in recent years and over a thousand contractors have been funding, implementing and using information technology in construction project. The trend for more IT spending in the construction industry is expected to continue in the succeeding years. In PRECISION Construction Sdn Bhd, it makes use of latest information technology which provides a shorter construction and design with ensured quality which can satisfy most client’s need. It has become a competitive advantage which makes itself outperform compared to other construction companies. There are few type of technology that master and make used by PRECISION to enhance good product quality and provide more efficient and effective work towards their client.
- 38. 38 1. Software application – BIM (Building Information Modelling) BIM (Building Information Modeling) is an intelligent 3D model-based process that gives architecture, engineering, and construction (AEC) professionals that insight and tools to more efficiently plan, design, construct and manage buildings and infrastructure. Traditionally, there have not been agents of change within the building industry. They have long been resigned to typical construction project problems, such as cost overruns, schedule delays, and quality issues. Therefore, to enhance traceability of the progress of the big project, Building Information Modelling (BIM) can be used and it costs around RM8,190.00. It has successfully make PRECISION Construction SDN BHD to achieve it competitive advantage in construction field. (AUTODESK) By using BIM, it helps optimize work and company processes of PRECISION Construction Sdn Bhd in different ways: A. Architecture It makes better design decisions, improve building performance, and collaborate more effectively throughout the project lifecycle. B. Civil It uses intelligent, connected work flows to help improve predictability, productivity and profitability of PRECISION Construction. C. Construction It digitizes PRECISION construction site and connect project information from design through construction and handover. D. MEP It improves MEP (mechanical, electrical and plumbing) design quality and collaborate in real time to support the project delivery process E. Plant It manages the design and construction of intelligent piping, structures and processes more efficiently and collaboratively throughout project lifecycle and at hand-off. F. Structures It explores how structural design and detailing software helps PRECISION win new business and support project delivery
- 39. 39 It is followed by a discussion of the contractual and organizational changes that are needed to fully exploit BIM offers to our company and can be implemented in a construction company.
- 40. 40 2. Computer– Aided Design (CAD) Computer-aided design (CAD) is a computer technology that designs a produce and documents the design’s process. CAD may facilitate the manufacturing process by transferring detailed diagrams of a product’s materials, processes, tolerances and dimensions with specific conventions for the product in question. It can be used to produce either 2-dimensional or 3-dimensional diagrams, which can then when rotated to be viewed from any angle, even from the inside looking out. A special printer or plotter is usually required for printing professional design renderings. CAD is also known as computer-aided design and drafting (CADD) CAD is used in PRECISION Construction Sdn Bhd to: Produce detailed engineering designs through 3-D and 2-D drawings of the physical components of manufactured products. To create conceptual design, product layout, strength and dynamic analysis of assembly and the manufacturing processes themselves. To prepare environmental impact reports, in which computer-aided designs are used in photographs to produce a rendering of the appearance when the new structures are built.
- 41. 41 By using this CAD, it brings a lot of benefits to PRECISION Construction which allows it to compete effectively with other construction company in relevant field: Explore the concept design ideas at the pre-construction stage. It helps built up with visualization and animation systems which helps in visualizing the final design concepts that is to be made by producing photo- realistic, static and moving images so that the clients can review the final appearance of the building at the design stage. The designed drawings also can be saved at any stage and enables the designer to make any modifications if it is required by the client or the structural engineer. It allows PRECISION company to have a simulation to do analyze and ratify the performance of the design in the real world before it is constructed. Better design will case in manufacturing hence it also will minimize the wastages occurred due to faulty design and provide a better and standardized drawing easily.
- 42. 42 3. Mobile App – PRECISION CON Nowadays, people are trying to save time and thus even using the browser of the mobile phone instead of using a laptop. Thus, PRECISION Construction SDN BHD takes the advantages of this trend to create a mobile device app for convenience use and efficiency of employees and protect team. ‘PRECISION CON’ shall have details such as company background, company mission, vision and core value, the past projects and our latest updates like new building location or projects that we are going to handle. Designing of this mobile app estimated cost approximately RM3,500. However, it has bring PRECISION Company Sdn Bhd to a higher level as it has outperform most of the company in Malaysia as it is the first company who start using mobile app of its own company. It also brings benefits to client as it helps in time saving when clients enquire on information about a specific project’s progress, hence increasing their satisfaction level towards PRECISION as to achieve our goal. There is also 24- hours online chatting for any enquiry by clients so that all enquires can be answered as fast as we can. Apart from that, the relevant project team which includes other contractors, subcontractors, suppliers and clients will be acknowledged on specification or requirement changes, which certainly proves integrity throughout the project. Benefits that will be achieved by PRECISION in using mobile app ‘PRECISION CON’ such as it can improve workforce and PM efficiency. Construction managers can improve efficiency and transparency of the entire construction project, from authorization and accountability to scheduling and monitoring. It replaces manual, paper-based data entries, which can be cumbersome and time consuming.
- 43. 43 Information Management Skills According to Wikipedia, Information management (IM) is the collection and management of information from one or more sources and the distribution of that information to one or more audiences. This sometimes involves those who have a stake in, or a right to that information. Management means the organization of and control over the structure, processing and delivery of information. Information management is generally an enterprise information system concept, where an organization produces, owns and manages a suite of information. The information can be in the form of physical data (such as papers, documents and books), or digital data assets. Information management deals with the level and control of an organization's governance over its information assets. Information management is typically achieved through purpose-built information management systems and by supporting business processes and guidelines. Moreover, IM also focuses on how that information is shared and delivered to various recipients, including individuals and different computing devices such as an organization’s website, computers, servers, applications and/or mobile devices. What are the types ofInformationManagementused in our company ? 1) Digital Asset Management (DAM) Digital asset management (DAM) is a content management system (CMS) that centrally stores and manages all digital files produced by an enterprise. It allows an organization to control and centralize management of digital content or data that is accessed or shared by staff members or other users. 2) Document Management Document management is the process of storing, locating, updating, and sharing data for the purpose of workflow progression and business outcomes. Centralized sharing and data storage within specific servers help organizations access information efficiently and effectively, along with securing protected data. Programs and servers are used in the process of document management. Important metadata is centralized, as opposed to decentralized or difficult to locate.
- 44. 44 3) Record Management System (RMS) Records Management system (RMS) is the management of records for an organization throughout the records-life cycle. The activities in this management include the systematic and efficient control of the creation, maintenance, and destruction of the records along with the business transactions associated with them. Considered a key component of operational efficiency, record management adds more value to organization’s information assets. Activities involved in records management are: Identifying the information which needs to be captured. Information planning for the organization. Enforcement of policies and practices regarding creation, maintenance, disposal of records Creation of a records storage plan. Classification, identification and storing the records. Coordination of providing internal and external access to the records keeping in view of data privacy and business and data confidentiality. Benefits brought by records management are: Elimination of redundant data. Increase of productivity and accountability in the organization. Reduction in research for the right information. Resources are saved from time consuming research for data retrieval. Cost-effective record storage due to absence of redundant records. Operating costs are reduced. Creation of records are governed by standards and regulations present in the organization. Thus, it ensures regulatory compliance. Record management helps in controlling the creation and growth of records Record management brings in the capability to adopt new technologies for record keeping. Litigation risks are minimized using records management. Vital information can be well protected and secure using record management. By providing easy and better access to relevant records, it helps in better governance and corporate decision-making.
- 45. 45 4) Learning Management System A learning management system (LMS) is a software application for the administration, documentation, tracking, reporting and delivery of educational courses or training programs.[1] Learning management system is a concept emerging directly from e-Learning, even though there were other tools, informatics or not which have encouraged distance education Distance Education Learning Environments Survey. The first introduction of LMS is in the late 1990s.[2]Learning management systems help the instructor deliver material to the students, administer tests and other assignments, track student progress, and manage record-keeping. LMSs are focused on online learning delivery but support a range of uses, acting as a platform for fully online courses, as well as several hybrid forms, such as blended learning. LMSs can be complemented by other learning technologies such as a training management system to manage instructor-led training or a Learning Record Store to store and track learning data. 5) Web Content Management A web content management system (WCMS), a utilization of a content management system (CMS), is a set of tools that provides an organization with a way to manage digital information on a website through creating and maintaining content without prior knowledge of web programming or mark-up languages. Managing web content effectively can have useful business applications in the enterprise, producing insights for decision-making and delivering results, as well as value. Additional features that might be included are: Automated, standard templates; Controlled access to the page; Scalable expansion to allow for growth; Tools that allow for easy editing; Easily installed plug-ins to extend existing functionality; Regular software updates; Workflow management; Collaboration tools allowing for multiple users to modify content; Document management; Content distribution and content update emails to users; Ability to display content in various languages; and Allowing editors to retrieve previous versions of content.
- 46. 46 Advantages of IMS Integrated System A guiding principle of MIS is that all computer-related business processes work as a single integrated system. An integrated system allows for improved communication among executives, managers, department heads and employees. For example, a fully integrated MIS system gives the same data framework to the sales department as it provides to the manufacturing plant. The shared data could lead to adjustments in the manufacturing plant to align production with sales goals. Better Decisions The improved communication MIS provides to all levels of the business improves the decision-making skills of those in charge. The old saying "knowledge is power" applies when business owners use the data gathered in their MIS applications to make smarter decisions. For example, we check the MIS system and sees the supply of components is not sufficient to meet the production goals. Then we can then decide either to order more components or to lower the production targets. Data Quality Issues One of the problems with an MIS framework is that the quality of the system depends largely on the quality of its data. If the data is insufficient, incorrect or misplaced, the decisions that managers make based on that data can be faulty Security Issues Another issue surrounding MIS processes involves data security. Hackers, identity thieves and corporate saboteurs target sensitive company data. Such data can include vendor information, bank records, intellectual property and personal data on company management. The hackers distribute the information over the Internet, sell it to rival companies or use it to damage the company's image.
- 47. 47 Cost Competitive Advantage Cost advantage means companies provide price at lower value but reasonably, but the items are same or better quality than the competitors. Companies used to execute strategy by continuously improving operational efficiency. Eg. By hiring workers with low pay check. Some company compensate it with different strategies, like offering certain benefits such as stock options or promotional opportunities. While, some companies choose to hire more unskilled labour. Our company using cost leadership from the aspect of manpower. Our company decided to hire foreign workers that can adapt job with low pay check. Even though is low pay check in Malaysia, but it is still considered as a pretty good salary at their country. Because their standard of living at their country is lower, so we can use reasonable price to hire them to fulfil the requirement of cost competitive advantages. Cost advantage is typically calculated for comparable items and doesn’t apply when there is a large difference in quality. Besides, our company also decided to use technology that can build the best and reliable quality items majorly used in construction like masonry brick, concrete bricks and etc. So that the production costs will decrease, and by using this opportunity to build a good reputation on our company. As our company target is to provide high quality products, but low price, as the time goes on, we believed our company able to compete with other famous company in this industry. By having the advantage, our company is able to invest more in research and development, give more chances to improve the quality of items, by using the same low price.
- 48. 48 Cost advantage can occur when a company create a good way to produce items through the perfection of production methods or by the utilization of resources in a more efficient manner than competitors. Moreover, our company by producing basic items in bulk by using efficient operations to lower the price of items. This is a win-win situation. As we can see that, our company is a construction company, the basic items of construction are bricks and etc. They are needed no matter how, unless the projects are special design. But think from the rational way, if it’s special design, will company take the project. No, management will based on the company’s ability and capability to accept the project offer. So this way might work, as the management able to manage well. Nevertheless, in the low cost strategy, our company must have thorough understanding of costs and how to maintain and sustain for the company. Our company should be standardize the offer to every clients, to make it fair and square, so that our company’s reputation will remain or even become better. Reasons of using cost competitive advantages are because we have a high vision towards our company. We wanted our company be able to sustain in this construction industry. So we had to make our price being acceptable to every audience in the country. Then, our company will build up a good reputation rapidly as ‘Good Quality, Cheaper Price’ company. By using all the methods listed above, we believed our company can do it well in the construction industry, even though we cut down the production cost, our company still earn smaller gross margins than other competitors do, but our company will grows and expands, as the projects we accepted increase, the profit of the company will be objective.