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International Journal of JOURNAL OF MECHANICAL ENGINEERING INTERNATIONALMechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976

6 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME AND TECHNOLOGY (IJMET) ISSN 0976 6340 (Print) ISSN 0976 6359 (Online) Volume 4 Issue 1 January- February (2013), pp. 30-43 IAEME: www.iaeme.com/ijmet.asp Journal Impact Factor (2012): 3.8071 (Calculated by GISI) www.jifactor.com

IJMET
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SUCCESS FACTORS ENHANCING BUSINESS PERFORMANCE OF ENGINEERING PROCUREMENT CONSTRUCTION (EPC) INDUSTRIES
M.D.Nadar1, Dr. D.N.Raut2, Dr. B.E.Narkhede3 and Dr.S.K.Mahajan4 1 Research scholar- Production Engineering 2 Dean Administration-VJTI, Mumbai 3 HOD- Production Engineering Department, VJTI, Mumbai 4 Director- DTE, Government of Maharastra, Mumbai Email: mdnadar@yahoo.com1, dnraut@vjti.org.in2, benarkhade@vjti.org.in3

ABSTRACT Engineering procurement construction projects play an important role in national economic development. India, which contributed approximately 8.5% to the total of Indias GDP. Project schedule slips, budget overruns, compromised quality, resulting claims and counter-claims problems have plagued the industry. The reasons for poor project performances abound. Previous researches have dealt much with the problems of project risk and uncertainty, variations in project outcomes, work fragmentation, complex relationships among stakeholders and activities, and excessive phase overlaps in general. In this paper dealt with EPC industries project success factors Construction projects are implementing different phases., viz., conception phase, definition phase, planning phase, scheduling phase, controlling phase and termination phase Various factors affect construction projects performance and success of projects i.e., completion periods of projects , project budget and better service to owners of project. The objective of this paper studying success factors variables, project functions, project activities, of project team members, project team members skills, attitude, experience, project tools, methods of project implementation enhancing the business performance of engineering procurement construction industries. Construction projects completion times are in line with owners requirements, and identifying gap reduction factors between project budget and project cost and improving business performance enhancing factors for construction project industries. To collect data, to record the collected data in tabular format, to analyze the recorded data by using statistical procedure and interpret ate success factors plays role in the EPC industry business operations.
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Keywords: project team, project planning, project manager, project packages, project activities, project schedule slips, project budget overrun, project cost 1. INTRODUCTION The purpose of this paper is studying to overcome construction projects complexities problems through successful factors of projects functions from conception phase to termination phase [1] (functions starts from conception phase, definition phase, planning phase, scheduling phase, implementation phase, monitoring and controlling phase and termination phases). Identifying complex functions with various variables to enhance complex function performance in construction projects operations [7]. Success factors to optimize the complexities of construction projects. Exhausted literature survey and EPC industry site visits are used to design and to develop the questionnaire. The questionnaire circulates amongst engineering procurement construction industries, Consultant, owners, Construction management CEO, programme managers, project managers around 500 numbers questionnaires are mailed, personally submitted with request, and received 43numbers. Questionnaires The questionnaire contents five parts viz., part-A(Company information), part-B(Measuring project success), part-C(Factors affecting project success), part-D(Use of computer packages for project management) and part-E(Project delay). Questionnaires analysis gives various functions complexities in execution of construction projects and corresponding variables (task, resources, time, and precedence) favors for success of functions and affecting success of construction projects execution. 2. RESEARCH METHODOLOGY To interview senior management of contractor, Construction management, consultant and owner of the project, EPC industry project head and visit to meet construction project site head interact and to collect the research related data and information To collect research related data and information of EPC industry through literature survey of referred research problems related national and international journals To design and to develop questionnaire with five parts of questionnaire partA(Company information), part-B(Measuring project success), part-C(Factors affecting project success), part-D(Use of computer packages for project management) and part-E(Project delay). Data and information of EPC industries related business operations problems collected through questionnaires. To record data and information from the collected questionnaires in the excel sheet and in the tabular format. Statistical tools are using to analyze the data and information. To observe and compare the business operations of EPC industries research related different problems and various characteristics of business operational activities, various operational factors to enhance the business performance activities and characteristics of operational variables [7]. To conclude the variables and factors are involves in success of EPC industries business operations.

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

3. QUESTIONNAIRE DESIGN This paper addresses studying and identifying the factors to stream line the input variables (resources, planning, scheduling) and driving factors to controlling (monitoring, updating) business operations of EPC industries. The questionnaire design and framework based on rigorous survey of EPC industry business operations related research journals of national, international literatures. And continuously visiting the site of EPC industry project execution and contact project site head for collect data and information related research variables and factors. The questionnaire consists of the following data and information collecting tools (questions). The questions divided in to five parts. partA(Company information), part-B(Measuring project success), part-C(Factors affecting project success), part-D(Use of computer packages for project management) and partE(Project delay). 3.1 Questionnaire Company information Questionnaire contents companys information are companys name, location of business operation, capacity of business operation in terms of manpower, turnover yearly, project size in terms of project cost, project duration and manpower involves in the executed project. 3.2. Questionnaire Measuring project success factors The executed project details includes project site, project details like type of the project i.e., mechanical, electrical, plumbing, HVAC, civil etc., technical capacity, type of the operational functions i.e., design, supply, installation, testing and commissioning, and project cost, projected executed time duration planned and actual, project success factors activities in tactical management planning like design planning, project site execution planning, manpower planning and material, machines and equipments [13] delivery planning to site daily, weekly and monthly, safety, security and housekeeping planning, project selection, material handling planning, risk mitigation etc., what are methods are using to drive the success factors. 3.3. Success factors importance in project execution Various factors are measuring relatively in the project execution monitoring phase, well defined tasks, responsibilities, reporting hierarchy organizations, project frequent feedback, well defined control procedures, use of management tools like PERT/CPM, use contingency plans, absence of lengthy procedures and absence of legal hurdles. The scales are defined relatively in between (1-7) 7 is most important and 1 is least important. Construction project success are defined different ways in questionnaire like project completion with in planned schedule, planned budget and minor delay[17], minor escalated budget, delivered construction project meets clients quality, technical specification, functional envisaged by the client, project benefits meets clients satisfaction, commercially profitable to client, meets clients objective of their business. The scales are defined relatively in between (1-5) 1 is most important and 5 is least important. Precautionary measures to optimize the success factors are defining the following questions and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. The questions are error free estimation of project completion time and project cost, composition of project team, choice of project leader, adequate of project funding, minimal start up difficulties, public support, project
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

progress monitoring and control techniques. Attributes of project organizations are plays roles in construction project success. The questions are defines the follows co-ordination among the major functions, informal structure, funding support and resources allocation, stability of policies and well defined reporting hierarchy and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. Construction project success is defined in the questions of qualities of project team and project manager size of the team, team spirit, job knowledge, willingness to learn, cost conscious, commitment to other projects and commitment to project dead line and administrative authority, technical competence, leadership style, timely decision making skills, communication skills, attitude and commitment , clarity of purpose, unbiased, involvement in details and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. Construction projects success further consider the client attributes and projects characteristics. The following factors are given below in the questionnaire frequent interaction with project team, fast response to project team queries, prompt payment of bills, co-ordination with project team[11], commitment with project team [3,4,5,11,12], incentives for successful completion, good rapport with organization etc., and size of the project, manpower requirement, technical complexities of project, technical skills requirements, Stringent quality / tolerance specifications, frequent changes to design requirements and special requirements of materials and equipments and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. External factors are deviating the construction project success state and these factors are presented in the questionnaire non availability of materials in time, nonavailability of technical personnel, co-ordination with multiple agencies [14, 15], unexpected ground conditions, price escalations, changes government policies, legal disputes, discrepancies in contract documents, bad weather and mistakes and repetitions of activities and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. 3.4. Computer packages tool role in construction project success Construction Project Company uses computer packages factors (computer hardware, software, internet facility, E-mail facility, fund transfer, telephone facility etc.,) involves in successful project execution process. How far computer packages tool contribution to construction project success defined the questions and scales are defined relatively in between (1-5) 1 is most important and 5 is least important. Planning, scheduling, resource allocations, resource histograms, budgeting, cash flow, crashing, report generation, project budgeting, project updating, project change management, on-line project status, planning for remaining work, earned value analysis, multi-project planning, multi-project resource sharing, contractors monitoring, bill of materials, materials tracking and management, transportation and distribution, risk mitigation, supply chain management, warehouse and stores management functions, accounting, bill payment, bill collection, shift-wise planning, integrated equipment maintenance, integrated shop floor planning, integrated quality planning and control, information communication / transfer [2,12] and Email / EDI support 3.5. Project Delay factors: Construction project delay [17] causes are based on managerial degree of decision maker favors to owners, quality of owners project manager, expected profit rate, market standardization degree, strategic orientation, ability solve the design problems, risk control capability, resource utilization degree, the number of follow-up of projects, the proportion of educational and experience literacy of project team members.
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

4. QUESTIONNAIRE RESPONDENTS The questionnaire respondents are executives, contract management, consultant, architect, owners and contractors Project manager, program manager, Procurement manager, executives, projects of civil, HVAC, MEP etc., Type of Industry Table 1 Region Mumbai and Around the Mumbai Less than 6 months Typical duration of Projects in last FY 6-24 months 24-36 months More than 36 months Type Govt. Public Sector / Private/Partnership or Propietorship 7 14 24 7

Total questionnaires are received from respondents are 52 Programme mangers and Project managers of contractors and construction management are 14 and 20 respectively out of 52 respondents, Project managers of consultancy 10 out of 52 respondents, Contractor Chief Executing officer 4 out of 52 respondents and project owner of 4 out of 52 respondents. The respondents industries based on ownerships are Government, propertiership, public sector and private partnership. 5. SURVEY RESEARCH FINDINGS Research finds variables for success of EPC industry operations are project success factors for Environments of monitoring of progress of project implementation, project success declaring environments, project enhancing factors, project implementing contractors, construction management and consultancy attributes, executing project managers qualities, project implementing team members qualities, attributes of qualities, complexities of projects, attributes of project owners and attributes of external factors. 5.1. Research analysis of monitoring of project process methods Project progress implementation Monitoring climate involvement in project success is given below. Table 2 Code Factors Success factors % C11 Well defined tasks and responsibilities 10.98% CI2 Well defined reporting hierarchy 11.98% C13 Well defined control procedures 13.48% C14 Frequent feedback 12.31% C15 PERT / CPM Techniques 11.15% C16 Computer based Techniques 10.98% C17 Use of contingency plans 10.98% CI8 Absence of lengthy procedure 9.32% C19 Absence of legal Hurdles 8.82%

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Figure 1 5.2. Research analysis of Environment of project success: Project success environment declaring factors are given below. Table 3 Factors Project completed within planned due date or minor delay Project completed within planned budget or minor escalation Project meets technical /quality specification of the client Project provides satisfactory benefit to the client (C24) Project delivers the functionality envisaged by the client (C25) Project achieves stated business objectives of the client (C26) Project is commercially profitable for the client

Code C21 C22 C23 C24 C25 C26 C27

Success factors % 13.5% 11.39% 6.33% 18.74% 16.46% 16.46% 17.72%

Figure 2

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Project success environments are declared the factors from more important to least important are projects provide satisfactory benefits to clients to project meets technical / quality specification of the client 5.3. Research analysis of Enhancing factors for project success in EPC industry Enhancing project success environment through the following factors are given below. Code C31 C32 C33 C34 C35 C36 C37 Table 4 Factors Accurate initial estimates (Cost and time). Composition of project team. Choice of project leader. Adequate funding to completion. Progress monitoring and control techniques. Minimal start-up difficulties Public support for the project Success factors % 14.2% 18.0% 12.1% 18.4% 16.7% 13.0% 7.5%

Project enhancing factors are ensuring the success of project implementation viz., adequate funding for completion, composition of project team and project monitoring and control techniques.

Figure 3 5.4. Research analysis of project implementing operational factors of contractors, construction management organizations and consultancy organizations characteristics influencing the project success. The following factors are influencing the success of the project implementation in EPC industries. Table 5 Code Factors Success factors % C41 Informal structure. 12.3% C42 Funding support. 18.2% C43 Allocation of resources. 14.5% C44 Stability of policies. 19.5% C45 Co-ordination among major functions. 16.4% C46 Well defined reporting hierarchy. 19.1% Policy remains same for all project owners encourages the success of project implementation like the quoting project price, method of project operational policies, project team
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

motivational scheme, well defined organization hierarchy etc., funding support of stake holders, contractors and vendors allocation of resources are make success of project implementation, co-ordination amongst project implementation team in multi major functions like HVAC, Civil, plumbing, Electrical, Building Management Systems (BMS)etc.,

Figure 4 project implementation viz., stability of organizational polices, well defined reporting hierarchy, adequate funding for completion of project, co-ordination amongst contractor, construction management and consultancy operational functions of project implementation, allocation and available of resources on time of activities execution and project execution to take place as team and follows as informal structure in the project implementation. 5.5. Research analysis of qualities of project manager characteristics is influencing the project success. The project manager characteristics are influencing the project success in the project execution are listed in the following success factors table. Code C51 C52 C53 C54 C55 C56 C57 C58 Table 6 Factors Technical competence. Administrative authority. Leadership style. Clarity of purpose. Timely decision making. Communication skills. Attitude and commitment. Involvement in details Success factors % 20.00% 6.27% 9.02% 11.37% 15.69% 16.08% 11.76% 9.80%

Project manager plays crucial role in the success of project implementation of construction industries operations. Technical competence characteristics of project manager are given the below. Technical qualification, technical skills and technical experience are contributing in the success of project implementation. Project manager communication characteristic reduces the hierarchical communicational gaps own organizations, communication process in the construction execution are existing amongst construction management, project owner and consultancy. Project manager plays role as information receiver and distributor. Project manager timely decision making characteristic, attitude and commitment, clarity of purpose factors are important in the project implementation success.

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Figure 5 5.6. Research analysis of qualities of project team characteristics is influencing the project success. The project team characteristics are influencing the project success in the project execution are listed in the following success factors table. Table 7 Factors Small size of the team. Job Knowledge. Team Spirit. Willingness to learn Cost Consciousness Commitment deadlines Absence of commitments to other projects.

Code C61 C62 C63 C64 C65 C66 C67

Success factors % 6.56% 16.39% 14.34% 19.26% 15.57% 19.26% 8.61%

Figure 6 Project team efforts are required to develop willingness to learn, commitment to deadline. These efforts are lead to major project success contribution. Job knowledge, cost consciousness and team work factors plays in the project success.

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

5.7. Research analysis of qualities of project owner characteristics is influencing the project success. The project owner plays major role in the success of the project implementation. The project owner characteristics are listed in the following success factors table. Code C71 C72 C73 C74 C75 C76 C77 C78 Table 8 Factors Frequent interaction with project team. Fast response to queries Clarity of purpose Good rapport with project organization. Commitment to the project. Prompt payment of bills. Incentives for successful project completion Co-ordination with project Team Success factors % 13.21% 15.47% 15.09% 10.57% 13.58% 13.21% 7.92% 10.94%

Project owner roles are important in the project execution success fast response to queries of consultant, contractors, construction management reduce the delay of project activities, the project product purpose clarity are required to be known by the client, frequent interaction with project team, commitment to the project and prompt payment of bills enhance the project success.

Figure 7 5.8. Research analysis of project complexities is resisting the project success. The project complexities plays major role in the success of the project implementation. The project complexities characteristics are listed in the following success factors table. Table 9 Code C81 C82 C83 C84 C85 C86 C87 C88 Factors Large size of the project. Large manpower requirement. Non-similarity to previous projects Technical complexity of the project. Stringent quality / tolerance specifications Special technical skill requirements. Frequent changes to original design specifications. Special material / equipment requirements. Success factors % 5.33% 10.66% 14.34% 15.98% 17.62% 11.89% 11.48% 12.70%

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Project complexities are resisting the project execution success are ranking in the table-9. Large size of the project increase the complexity of project characteristic resisting the success of the project execution, consequently large manpower requirements increase the difficulties and complexity of managing project execution it may lead to affect project success in construction industry. Similarly the ranking of project success resisting factors are technical skills requirements, frequent changes of original design specifications, special materials and equipments requirements, non-similarities of previous projects, technical complexity of projects and Stringent quality / tolerances specifications resisting the project

Figure 8 5.9. Research analysis of project External factors resisting the project success. External factors plays major role in the success of the project implementation. External factors characteristics are listed in the following success factors table. Code C91 C92 C93 C94 C95 C96 C97 C98 C99 C910 Table 10 Factors Non availability of materials in time Non-availability of technical personnel Coordination with multiple agencies Unexpected ground conditions Price escalations. Changes in Government policies. Legal disputes Discrepancies in contract documents. Mistakes and repetitions of activities. Bad weather. Success factors % 12.64% 13.75% 13.01% 10.08% 9.67% 8.18% 9.67% 5.95% 9.67% 6.69%

External factors ranking are described the descending order in the success point of view. Discrepancies in contract documents resisting the project progress and lead to delay in the project completion, Bad weather, changes in government polices, price escalations, legal disputes, mistakes and repetitions of activities are lead significantly to hurdle the project progress, unexpected ground conditions may lead to disturb the project considerable progress. Finally the following factors non availability of materials in time, co ordination of multiple agencies and non availability of technical personnel.
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

Figure 9 6. SUMMARY OF RESEARCH ANALYSIS AND PROJECT SUCCESS IN EPC INDUSTRY Projects are successfully implemented when controlling the following factors are operational systems of contractors, consultants and construction management most important to enhance the EPC industry business success External factors resisting the project success. External factors plays major role in the success of the project implementation. External factors characteristics are listed in the following success factors table. Code C1 C2 C3 C4 C5 C6 C7 C8 C9 Table 11 Factors Project monitoring methods Project success environment Project success enhancing factors Operational systems of contractor, consultant and construction management Qualities project manager Qualities project team Client characteristics Project complexities External factors Success factors % 11.4% 11.4% 11.4% 12.5% 10.8% 11.8% 11.1% 10.4% 9.1%

Figure-10

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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

7. CONCLUSION This paper reports the findings of an Action Research based investigation, which was concerned with determining whether best practice used in other EPC industries to facilitate the success of construction business process. The ranking of success factors gives ideas to implement the EPC industries project follows the guide lines to success of the project in the form of cost, time and quality development. The results of this research suggest that: The operational methods of contractor, consultant and Construction management is to be improved. Theses all success factor related to quality of project operational systems. Contractor, subcontractors, construction management and consultant the quality success factors are considered the following sequences. The qualities of project team, project monitoring methods, project success environment, project success enhancing factors, client characteristics, project manager attributes. Project complexities and external factors are to limit the success of project implementation. EPC industry success factors are implementing methodology to be developed is scope of this paper. Like subcontractor rating, vendor selection, supplier certification, project team training, project manager qualities training program, Design and development of constructional process operational systems in construction activities 8.ACKNOWLEDGMENT We express our sincere thanks to our institute management of VJTI for allowing us work on construction management, we extend our sincere thanks to Dr.L.Ganapathy (Professor in NITIE-Mumbai) give us proper guidance to search the construction industry problems, our thanks to Shri. Dharmaraj, Adhithya Erode. who give us vision, mission and financial support for this research work and also make me to develop this paper we extend our sincere thanks to Dr. K.M.Vasudevan pillai and Dr.R.I.K.Moorthy, CEO and Principal Pillai Institute of Information Technology New Panvel , for giving us continuous motivation and time to complete this research work paper publication and last but not least our thanks to our family members for giving us patience to complete the paper publication. 9.REFERENCES [1] Evbuomwan NFO, Anumba CJ. An integrated framework for concurrent life-cycle design and construction. Adv. Eng. Software 1998;29(79):58797. [2] Latham M. Constructing the team: joint review of procurement and contractual arrangements in the United Kingdom construction industry: final report. London: Department of the Environment; 1994. [3] Payne J, Thomas K, Perkins M, Parker R, Small J. Working in an integrated team, E3112. London: Construction Productivity Network; 2003. [4].Alshawi M, Faraj I. Integrated construction environments. Construction Innovation 2002:23351. [5] Loo R. Assessing team climate in project teams. Int J Project Manage 2003;21(7): 511-7. [6] CII, Procurement and materials management: a guide to effective project execution, Construction Industry Institute, Implementation Resource 7-3, 1999. [7]Y.Y. Su, L.Y. Liu, Real-time tracking and analysis of construction operations, Proc., Construction Research Congress, ASCE, Grand Bahama Island, Bahamas, 2007.
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International Journal of Mechanical Engineering and Technology (IJMET), ISSN 0976 6340(Print), ISSN 0976 6359(Online) Volume 4, Issue 1, January - February (2013) IAEME

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