2020年3月11日 星期三


Outline of "Introduction of Construction Industry",  Lectures for Construction Department, NTUST University in Taipei

1. Infrastructure Projects and the Economic Development:

 1) Co-requisite to national development and economic growth.

 2) Essential to the establishment and continued prosperity of related industries.

 3) Civil engineers can be harbingers in establishment of meritocracies in young democracies.

 4) However, construction contracts risk to become cash cow of crony capitalism and the contractor the accomplice of kleptocracy(reference: FPCA, Transparent International). 

 5) Contractors use survival as excuse to steal public money but the truth is construction lucrative, professionalism the only antidote to fight the greedy and impunity behind the organized corruption, though patience required.

 6) Taiwan escaped endemic corruption in the construction works usually seen in the developing world.

 7) Civil engineering is always considered as sort of physical science; but unlike manufacturing or IT industries, its origin and background attached to history, culture and custom of the vernacular country.  One has to secure more           humanities attainment when he want to be the company leader and industry visionary with "construction" is an art rather than a science in mind.

 8) The implementation of public works should always be kind of choices rather than direct conviction that rngineers will decide. By rendering the new idea or criticize the existing things, he can shake, crumble, and change             public perception incrementally further demonstrate the construction industry inot a yes or no scientific verdict.

2. How a freshman to start himself for a successful engineering career:

 1) Think big, internationally; then prepare hard with grass root efforts.

 2) Attitude decide everything.  As engineer cdistinguish good and bad, right and wrong, anxiety and insouciance at early stage, he can take proper attitude to solve problem and retain a prominent position in the industry.

 3) Understand how political institutions, social establishment, and interest groups exert influence on each other and solve their difference to make government functioning and economy progressing in a real world.

 4) Identify own role in the future will be suject to uncertainty and things like licenses, certificates, and academic degrees can be useful that engineers should try to get as many as possible.

 5) In many industries the talent shall start early and untainted by the business, however, the founders of construction enterprises normally have to accumulate work experience and build human connections.

 6) The modern construction industry is governed with human distrust: terms of contracts, laws, certificates, checks, guarantees, tests, investigations and reports, as designed by "intrusive" white collars are used to elevate the         antagonism between confronting parties.

3. Modern construction Industry and its Major Players:

 1) Frontage Players: general contractors, engineers and consultants, architects, specialty contractors, labor gangs, investors.

 2) Supporting Entities: banks, guarantor (popular in US), insurance companies, investment companies or fund, operators.

 3) Third Party Participants: notaries, law firms, inspectors, laboratories, certifiers, appraisers, unions, arbitrators.

 4) Stakeholders: Public, owner, authority, users, neighborhood and locals.

4. Features of Construction Industry explained in 5M:

 1) Man:

  (1) Managerial cadre, Professional, Occupational.

  (2) Disciplines, expertise, project based management, functional department oriented management.

  (3) Personal and organizational behaviors, coordination and communication under high or low context culture.

  (4) Labor laws, quality, incentives, unions, big bosses.

 2) Machine

  (1) Prototype, bespoke; portable, fixed.

  (2) Operation, maintenance and repair.

  (3) Rental and owning.

  (4) Construction method and machine selected.

 3) Material

  (1) Local, traditional construction material as first choice.

  (2) Availability, reliability and transportation.

  (3) Permanent equipment and facilities to be installed.

 4) Money

  (1) Payment: cash, in kinds or goods(barter), deferred (BT), franchise revenue(BOT, PMI).

  (2) Standard international contracts to regulate: FIDIC, NEC3(New Engineering Contract3), AIA(American Institute of Architects), JCT forms of Contract(Joint Contract Tribunal)...etc..

  (3) Knowingly that the shared added values in a construction project by technology, skill and labor is diminishing as 21st century capitalism has morphed to become more favor of mammon.

  (4) Interests of investors are highly honored as delivery of the projects as for their dates, quality, functions, and values must be guaranteed with syndicates of financiers, big contractors capable of taking risks are preferred to the         third world entrepreneurs, it’s the trend.

 5) Market

  (1) Relative to the contract amount, the capital needed for constructors is low; in addition, risks and capital sharing to the sub-tier contractors  is easy, further lower the threshold entering the market, causing the industry                   extremely competitive.  

  (2) Style of competition: lowest bid, evaluated lowest bid, value for money.

  (3) Elements of competition: price, technical approaches, time of completion, safety record, experience in similar works, existing work loading, managerial and technical resource in hands, records of contract disputes(with owners)     ...etc..

  (4) The developed countries’ big says on the codes, standards, disputes solutions and financial arrangement in antagonistic with rising power’s defying approaches to the international market, such as “belt and road initiative”     will decide whether it comes the end of the norm in next few years.

5. Working in the Foreign Land

 1) License, Registration, Special Permit for Foreign Contractor.

 2) Acknowledge of difference and handicaps:

  (1) Handicap in language.

  (2) Difference in cultural perception.

  (3) Difference in applicable code and standard.

  (4) Difference in executing safety and environmental protection rules

  (5) Difference in Tax code application and interpretation.

  (6) Difference in labor management.

  (7) Hindrance or inconvenience caused by entry visa and work permits for expatriates.

 3) Unmanageable Risks:

  (1) Politic risks(regime change, war, commotion, nationalization, sanctions,    embargo)

  (2) Exchange an d currency risks

  (3) Economic risks(inflation, interference in manufacture and transportation system)

  (4) Natural disasters(flood, typhoon, earthquakes, avalanches)

  (5) Legal risks(change of law, unpredictable adjudication)

  (6) Cultural Risks-incoherent mental and behavioral model between host country people and foreign contractor.  

 4) Manageable Risks (with care and monetary provision):

  (1) Construction schedule and completion date.

  (2) In time delivery of construction material and equipment both in quality and quantity.

  (3) Contractual risks

  (4) Safety and security of expatriates (persons, property, accidents).

  (5) Free flow of capital.

6. Conclusions:

 1) Design and construction technologies are prone to natural science while marketing and management of construction companies closer to culture science. An engineer blurs the division line of both and eager to explore more     humanities within the business will have more successful career.

 2)   As modern construction projects take more trades, disciplines and resources for its more complicated feature. The participants are imposed more risks by more demanding clients; only the construction companies with        reasonable scale will survive and thrive facing demanding clients. Under the circumstance, the young talent have better to choose more sizable company for a brighter future. It's an international trend.