1. Formal Project Management Adoption
Readiness of Emerging Contractor Firms in the
Mangaung Metropolitan Municipality
Julius Akaba, Patient Rambe PhD., E. Agbobli, PhD.
051 507 3870 * 051 507 4064 * 051 507 3955
Central University of Technology, Free State
Faculty of Management Sciences
Department of Business Support Studies

2. Presentation Outline
• Introduction
• Problem Background
• Problem Statement
• Literature Review
• Justification of PM tools and techniques in ECFs and Construction Industry
• Proposed Conceptual Framework
• Reflections
• Methodology
• Significance of the Study
• Concluding Remarks

3. Introduction
• Emerging Construction Firms (ECFs) are small businesses owned and run by individuals from
the previously disadvantaged group which undertake construction projects.
• Projects are temporary investments undertaken to fulfil objectives that are beneficial to society
and stakeholders(PMI, 2013; Brown & Hyer, 2010; Clement & Gido, 2012; Pinto, 2013).
• Performance of ECFs in the construction industry is generally considered unsatisfactory.
• ECFs’ adoption and implementation of PM techniques and tools could help overcome challenges
of under-performance.
• Maximising project benefits requires application of PM techniques and tools to deliver project on
time, within budget and quality standard (Maley, 2012; Pinto, 2013; Larson & Gray, 2014).
• Application of PM techniques and tools heightens chances of successful project delivery of any
project size (Larson & Gray, 2014; Pinto, 2013; Steyn et al., 2013).

4. Problem Background
• Construction business is project based (Larson & Gray, 2014)
• ECFs must have PM systems and capabilities to run projects successfully (Larson &
Gray, 2014, CIDB, 2011)
• ECFs often do not have formal PM systems which accounts for numerous project
failures, itself a justification for ECFs to adopt and implement formal PM systems
(CIDB, 2011)
• PM adoption implies change BUT change implementation requires determining
change readiness to optimise success of change (Bricknell et al., 2011)
• PM adoption readiness of ECFs is desirable if they are to adopt and implement PM
systems successfully.

5. Problem Statement
• Paucity of knowledge on PM adoption readiness of ECFs in Mangaung
Metropolitan Municipality

6. Literature Review
• Contractor development in emerging economies emerged in the 1970s (Ofori, 1996).
• Prohibition of joint contracting and joint entrepreneurial venture enterprises between black
and white run businesses in South Africa during apartheid (Berry et al., 2002; Tshivhase &
Worku, 2012).
• Emerging contractor development programme (ECDP) redressed past disadvantages of
black entrepreneurs in construction industry (BBBEE Act 53 of 2003)
• ECDP empowers individuals from the previously disadvantaged groups economically
(BBBEE Act 53 of 2003)
• Long term sustainability of the programme tied to legislative and policy framework e.g.
BBBEE Act and PPP Act (BBBEE Act 53 of 2003; PPP Act 5 of 2000)

7. Justification of PM tools and techniques in ECFs and
construction industry
• ECFs and Construction Industry – ECFs activities are typically in the construction
industry of South Africa.
• Resonates with government effort to economically empower individuals from the previously
disadvantaged groups
• PM and Construction Industry –construction industry activities represent projects as
they are temporary, time bound, unique & driven by project objectives (Larson & Gray, 2014;
PMI, 2013; Palaneeswaran, 2006)
• Justification for PM techniques and tools in ECFs activities
• PM and Business Strategy – Projects constitute tools of implementing business strategy
of an organisation.

8. Justification of PM tools and techniques in ECFs (cont’d)
• PM tools and techniques can be used since new strategies are considered as projects
(Larson & Gray, 2014; Gardiner, 2006; Milosevic & Srivannaboon, 2006)
• PM and Organisational Structure – Without appropriate organisational structure,
PM implementation is difficult (Pearce & Robinson, 2013; Pinto, 2013; Ehlers & Lazenby, 2010)
• PM and Organisational Culture – Good PM requires a supportive organisational
culture (Larson & Gray, 2014; Schwalbe, 2009)
• PM and Specialised Skills – Acquisition of certain specialised skills is critical to
skilful use of PM techniques and tools to ensure successful project delivery
(Kloppenborg, 2012; Maley, 2012)

9. Proposed Conceptual Framework
• Effective PM implementation is conditioned by the prevalence of a
conducive organisational structure,
organisational culture
PM skills and tools, mediated by
organisational change readiness.

10. Proposed Conceptual Framework
Figure 1: Proposed model for effective PM implementation (Authors’ compilation)

11. Reflections
• Effective PM implementation is possible if ECFs do adopt the model
discussed above taking into consideration the various variables as indicated in
the model.

12. Methodology
• This is a theoretical paper based on literature review
• Concepts, constructs and relationships among variables drawn from
literature were used to make logical inferences about the extent of formal
PM adoption readiness of emerging contractor firms.

13. Significance of the Study
• Construction literature though has been dedicated to various issues regarding ECFs
such as lack of PM skills, inadequate resources and government delay in payments.
• PM adoption readiness of ECFs in the construction industry largely ignored (Lazarus,
2007; Thwala, 2009).
• Study attempted to close gap by illuminating critical success factors of ECFs for
effective project management
• Tackled PM readiness of ECFs by drawing on current PM techniques and tools to
ensure effective project delivery.

14. Concluding Remarks
• PM techniques and tools are considered critical to effective implementation of
ECFs projects
• Adoption of PM techniques and tools is never an automatic process for effective
project management implementation
• Effective PM implementation demands sufficient organisational change readiness
• Organisational Change readiness sets the tone for developing a supporting
organisational structure, result oriented organisational culture and PM skills based
congruent with successful project execution
• Effective project execution can be conceived to be chain reaction process