PART 5-1, Advanced Civil Engineering Construction
MT KAO (Blog: http://mtkaoforum31.blogspot.tw/) (firstname.lastname@example.org)1)
1) Frontage Players: general contractors, engineers and consultants, architects, specialty contractors, labor gangs, investors.
(2) Consulting Engineers
a. The difference regarding business ethic and work attitude between the professionals and occupational is that the former are dutiful, intelligent and conscientious toward their clients and the latter just following the orders from bosses and formen. To honor and guard the professionalism, the professional decisions in no way should be compromised, twisted and altered by particular one's interest, thronged opinions, or punishment.
When engineers’ trusted and confided with responsibilities for safety, functioning, aesthetic, durability, budgeting and sturdy completion of construction projects, their judgement, opinions, and integrity must be respected, and most important, their service must be remunerated fairly as it's the backbone to support the idea that the professionals are the brains of their client.
b. The professionalism allotted to engineers usually include investigation, feasibility study, planning, design, supervision, project management and other services related to civil and building works, both public and private.
In Taiwan, how the engineering service is practiced is sanctioned in "Professional Engineer Act":
Article 7 A professional engineer shall practice the profession in any of the following manners:
1. Establish an engineering office organized as a sole proprietorship or partnership.
2. Establish a professional engineering consulting firm or be hired by one.
3. Hired by a profit-seeking enterprise or entity, other than those mentioned in the preceding subparagraph, which is required by law to hire a licensed professional engineer.
If we trace history, we will know that professional engineering service was originated from craftsmen, lawyers, engineers or the partnership those individuals formed.
c. The projects in modern days, for all the complex nature not only require advanced technology; but also need proposals with exceptional commercial skill to enhance chances of as-planned completion. So, it calls for all sorts of bright people offering more inclusive solutions.
Apparently, the professionals can well exercise their knowledge and skill disregard what their choice to sign the contracts in "proprietorship", "partnership" or "corporation“.
But the industrial reality is that a corporation big enough may have more room to accumulate experience, possess data, search for information, so in a better position churn out proposals.
Also when they are big, a company can have lots of talents adhered to share office equipment and software cost; the same is true for the expensive supporting costs for chores, such as, financing, accounting, or administration. It’s important because it will free engineers’ mind so they are able concentrate on professionalism; considering the contradictory situation that the professionals have to be bothered by those chores if they have to do the works by individuals or small companies.
d. So, a lot of clients today when want to make award of the engineering jobs of complicated nature, they will feel more comfortable to engage the business with sizable and reputable companies, to relieve their responsibilities from the beginning.
But it’s just a trend and shall not be over interpreted as that the big corporations may have their own problem in performance and cost.
e. We all know the professionalism stems from individualism and entails characteristics unique to each professional: vision, responsibility, work attitudes, which shall be prerequisite to shape a concerted team undertaking sophisticated engineering works in competition with individual or more coherent partnership for efficiency and responsiveness.
Remuneration to the professionals remains a big problem in managing engineering companies as people always view their own performance impeccable and believes they are entitled for more than regular salary and bonus. The argument's often focused in profit sharing, and stays at every junction where company elite flaunt their eminence. People may imagine there could be a terminal arbiter in big engineering company busy to dole out verdicts to assure everybody's material and vanity reward will be met, but that's not realistic.
For small engineering companies, the bosses usually grumble for the employees’ impatience to demand profit sharing before showing their contribution; but the hired will also complain their performance is never recognized.
The wish wise men may be there for positive intervention is a pipe dream in the real world, instead, egocentric human nature will prevail. Discords and disputes always happen between the quarreling parties, and the burst out usually take the form that people arguing over things abstract and virtue like vision, responsibility, work attitudes. But actually money is behind, if contradiction not solved the result will be exodus of high minded people, or the cooling down of remaining people's passions to learn new skill and knowledge.
Modern professionals firms will use options such as extended partnership or stock warrant awarding to employees to keep their loyalty. It's important because many people consider the company's gain is only possible with their affectionate engagement and they're deserved to share profit as partners.
f. The idea is different with the bonus and prizes scheme applied for companies to sell material, product, or simple services; which only ask employees sticking to positions and to do works countable and not unique for individuals. It may not be suitable for sizable and sophisticated consultancy; but a practice in Taiwan for national enterprises.
In Taiwan, the government handled the importation of construction technology closely during the days resources were scarce, and many of the engineers were trained on jobs like dam, petrochemical complex, and expressway. To counter balance the more advanced international companies, the government then sponsored big consulting and construction firms with the view that they could be reliable and competitive to carry out public work for the future.
Years after, the government was forced to withdraw from the construction companies sponsored as private contractors won over contention. However, the public consulting firms still remain and dominant in the engineering market, as they still receive the trust and patronage of government agencies anxious to launch infrastructure projects.
g. The government funded consultants pay their engineers of salary, bonus and dividends similar to what has been arrayed in other public enterprises of much less professionalism content. The practice omit that the services originally are individual-oriented and in the case of corporation the people must fetch not much less than their colleagues under sole proprietorship or partnership. Over time the side effect not pay enough to professionals will appear: efficiency discounted, talent lost to other industries, projects other than routinely implemented need to be done by international consultants.
The government funded consultants are more obedient to follow contract terms freely interpreted by public servants short of flexibility in forecasting project requirement and rectifying them later. So the government agencies prefer to award sizable engineering works to government funded consultants and thus strengthen their dominant position in the industry despite private design firms always crying foul saying that the state shouldn't interfere the market.
It's nothing wrong in a society actually embraces egalitarianism and hates to pay some of professions high price to continue the practice awarding the contracts to government funded consultants as many public works can be carried out with minimum cost and completed in time desired by the officials and end users.
But when technology bred domestically may not be sufficiently advanced as the result of individual's lacking of incentives because there’s only one buyer for the public works-the government. The foreign consultants or architects will be eager to fill technical gap but only at dear prices. And any attempt that the government agencies to ask affiliated firms to bridge the difference in terms of price and contractual obligation will introduce further procrastination and induce secondary damages.
a. On the other hand, recent earthquakes and associated perils shook the generally untroubled profession for liability as the latest enacts and verdicts hold them accountable for supposed wrongful design and supervision years after buildings completed, fair or not, the profession needs to be big at least for more risk absorbing capability, though it can hardly grow under the law that it can't be organized into company.
b. In reality, since the architects are short of profit sharing scheme with employees, that they have difficulty to keep fellow employee's royalty and recruit bright new ones. Ironically when the hired shrewd enough to see the situation not favorable to them will try to start their own business and worsen the competition in a small market.
And now in Taiwan, the new comers granted architects' licenses are in high number, but real estate boom is over; competition among architects, most of them small, is very serious.
So many architects in Taiwan are nervous and plead to relevant government agencies:
1. The fees allowed for public building design are calculated as fix percentage of construction price, and now both the percentage and final construction cost are low so petitioners requested an improvement.
2. That the cooperation with reputable international architects shouldn't be necessary as local architects are artfully good and technically competent. For officers fantastic with lavish building outline and avant-garde design should ask local rchitects to implement. Current practice inviting foreign architects playing protagonist and forcing their local partner shoulder contractual obligation are not acceptable. Though, many private developers still court international architects because the "names" will boost the house sale.
3. The architects consider the responsibility of supervision during construction shall not on their side and shall be rectified with clearer definition in the laws.
Traditionally, the market is small for Taiwan architects that they have to be more internationalized.
(4). Workers, Labor Gangs and Subcontractors
a. In Taiwan, that General Contractors did not own equipment and hired technicians and labors for actual construction. They would sub-let the labor work to subcontractors or worker gangs for the reason of convenience and so finally they would lose ability to deal directly with labor; sort of degeneration or eutrophication！
There might be craftsmanship existed among the labors to guarantee work efficiency and quality; but the contractors in Taiwan will prefer to replace the subtle labor management with simple rate and quantity relationship, and leaving gang leaders the responsibility to recruit workers and pay workers at almost fix rate wages. By doing so, general contractors would transfer the risk of income fluctuation to the labor gangs and subcontractors.
Originally main contractor may allocate the works to different gangs such as rebar, form work and concrete pouring, but still took care of coordination and supervision works required for the said structure construction; and now main contractor might ask one sub-contractor to undertake whole works so as to save cost for engineers required for coordination. The process continued, main contractor's role reduced, that in some cases, the workers at site had to be smart enough to do the works autonomously.
b. Though engineers will draw plans, pen proposal, and check mistakes; construction work has to be carried out by labors, technicians and foremen with hands, and it's them to materialize white collar's ideas for all difficult, dirty and dangerous work environs. The practice had historical background dated back from the days that labors were in over supply and their salaries were suppressed, work condition miserable. At then, management of main contractors were able to leave the drudgery to people with social class distance far away from them.
Work division in Taiwan construction industry become vertical like fault line in many cases, i.e. a sub-tier will do in situ construction; the other maybe the main contractor offering the name, provide guarantees, and maybe take care of documentary works. It allows certain type and numbers of people venturing to obtain profit while the other parts have to trudge for mere survival all the way. A reason that people like to gamble on construction business
c. But there is demography change, technology evolution, and managerial transcending in 21st century, now the labors reluctant to stay at for hard labor. Crews shrink and members are aged, they demand safety, reject toil, fall short in dexterity, hesitated to commit in works as their forerunner. So the contractors signing up the construction contracts can't find enough gangs and workers for their projects even with TCN (third country national) joining the team.
The work conditions at construction sites, compared to factories and service sector are bad. The parallel was like coal mines of Taiwan in 60's: unsafe, hard, and expensive to extract, the workers were aged and diminishing. Contrary to what bureaucrats thought of that it was the exploitative owner-labor relationship hurting the industry, the mine owner actually coddled the old men until the end of operation.
(5). Specialty Contractor
a. First the specialty works was defined as special project requirement introduced from outside the country, they fetched prices and rates equal to international level which many Taiwanese contractors deemed unfair. So there had been strong tendency in Taiwan, everyone from client, consultants to contractors will encourage those dared to imitate the imported technology and break the oligopoly: foremen and fellow labors learnt the construction method, equipment and plants made in local, so was the material to corner the market replaced by those reachable in Taiwan.
b. As the result, most of the international specialty contractors withdrew from Taiwan, and the natives took over; the stories happened to work items such as diaphragm wall, grouting, travelling wagons, system form works, and cable and tendons, all taking places within very few years.
To certain degree the locals created wonders; many of them endured failures and finally smack technical Okays. But financially it's not Okay for companies having done R & D works so much and only received puny overhead and profit because even among the winners the contention is harsh.
c. In general, the companies doing the specialty works in Taiwan can't distinguish with ordinary sub-contractors, instead, many of them under pressure that their equipment, plants and crew must undertake next job to continue the business. So they're forced to bid the total tender package as other general contractors if they're lucky enough also to be qualified.
Then the borderline between the specialty and general contractors is blurring and either it's the cause or the fallout that specialty contractors are not respected for their expertise. The industry will cease to progress technically because the people exhausted fighting international colleagues only attained mere survival in the event they could win. So they wouldn't have motives and strength to go for another round of invention.
When the specialty contractors have little prospect to grow and go for international, it's not advisable for the freshman to develop their career in such companies.
a. The investors play key roles in construction projects as they have vest-in interest for success of investment. For public projects there will be elected officers and administrative in government agencies speaking of requirement in details but they have to be confined by opinions from experts, media, and councilors. For private business, it seems like the investors have tremendous power searching for maximal benefit, but they have to be bound by laws, regulations and the same-public opinions, the hidden rule of democracy.
b. Investors in developing their projects must meet higher than standard rate of return, also from beginning, they have to decimate risk and uncertainty that fund and banks behind relentless to pursue. Among the concerns, quality and in time completion shall be most critical, but that's only fundamental. In the case of real estate developers, they must consider buyers or tenants' requirement for buildings; and for plant owners they must consider purchasing contracts for product and stability of the market. Because long term investment security is now desired, the frontage investors should pay additional premium to guard their principle and the eventual capital holders are assured and pleased.
c. It's 21st Century, in order to deliver the projects, or to get hedged when odds do happen, cost paid to notaries, law firms, inspectors, laboratories, appraisers, and certifiers can be regarded as more important than expenditures for tangible object such as concrete and steel, despite they only add up puny protection for investment, complete reversal of material scarce yesterdays.
Public clients tend to be more difficult; though they may not quantize the risk and seek coverage, but everything must be definite at day one or they have to go through onerous procedural justification. Theoretically, consensus must be collected before set up project goal, but the political requirement: compromise, prejudice and well wish will overshadow the implementation and take away the experts' opinions. Election and office change further complicated the matters as politicians and voters are not predictable, sometimes U-turn is necessary, projects hard to finish is everywhere over the world.
d. Investors, private and public, are now asking the professional companies to work for them as PCM, a good system but occasionally not functional because the clients don't really delegate powers. The other extremity is the government agencies don't have their own people installed in the high positions of the project to determine how their true demand will be met in concert with financial capability known to insiders.
For ordinary case, little can't be programmed according to records and data available at the hands of officials holding the powers of budget approval, progress control and performance audit; it means the non-professionals can claim their means based on statistic and bureaucracy is workable and better entrusted by the public to manage national coffer.
However, the attitude said above is a kind of hubris under which the professionals are frustrated and muted. Because the construction market isn't always the same that the routine will not always be routine; only the professionals will offer solutions to overcome the blocks huddling the launch of construction works.