Thinking outside the box to improve infrastructure project supply chain network

John Constance MSc in Project Management, University of Liverpool Introduction Infrastructure projects fail due to schedule and/or cost overruns and poor quality. Most times this overrun is due to poor supply chain networking. However, close engagement between infrastructure project teams and their network of suppliers can create possibilities to decrease costs of infrastructure project construction operations. Project managers must gain profits in infrastructure investment. From the many surveys and results it is clear this is possible. There are several strategies for achieving profit margins and project success. The conclusions from these surveys recommend infrastructure project managers combine quality and control in supply chain network to manage their projects more profitably, advising the construction industry adapt examples from other industries and make similar changes in the management of infrastructure projects. These examples include, planning and executing project through live-cycle management (LCM) methodology (Guo & Skitmore (2010), applying flexible technology systems based on the project characteristics (Scheepers et al. (2010), selecting and constructing through appropriate decision-making framework (Kumaraswamy, et al. (2004); conducting infrastructure project-related risk assessment (Zou & Fang (2008), incorporating agility in the management of the supply chain network (Collin & Lorenzin (2006); and adding quality into the management of infrastructure projects (Koh and Low (2010). This paper will address two key paradigms project managers can incorporate quality management and control processes into infrastructure project supply chain network to achieve success. Example # 1 - Quality Apply TQM and risk management The American Society of Quality considers Total Quality Management or TQM as quality improvement for long-term customer satisfaction through process improvement, product services and cultural practices, involving all organization members. According to Koh & Low (2010) the key elements of TQM are leadership, customer management and process management. TQM must involve senior managements commitment and leadership through the organizations values and goals, project managers and department heads accept TQM by evaluating quality in planning and in construction cost and schedule, considering adequate resources for quality management, and keep quality in the organization through total communication. Making TQM a management philosophy compels organizations to pay attention to its network of suppliers to ensure there are no setbacks in their construction operations. TQM leads to continuous monitoring and control of the operations. This makes the

organization demand risk management, which according to Zou & Fang (2008) is a factor for projects success or failure. With TQM as an organizational objective, there will always be the evaluation of risk for possible changes to the political system, instability, law and regulations, currency, exchange and inflation, and non-corruption. Applying TQM and risks management is an example of incorporating quality into the supply chain network of infrastructure projects. Example # 2 - Control Apply agility and relational agreement In the Journal of Global Strategic Management, Intaher Marcus (2010) describes agility as the ability of service providers to precipitously respond to changes in market and customer demands and re-design their supply chain to solve business, economic and political issues and gain the competitive edge over others. This, according to Collin & Lorenzin (2006) builds agility into construction operations applying demand planning between suppliers and customers through information flow, two-way relationships, inventory cushioning, and reliable logistics partnership (Lee (2004 p. 420). With agility, partners can apply a relational agreement, which according to Gil (2009) is a strategic approach to develop cooperation between infrastructure investors and their suppliers. The author encourages infrastructure investors to reconsider their conventional commercial practices and move from rigid lump sum contracting and apply relational contractual agreement to foster long-term suppliers cooperation and relationships to control their supply chain network. Conclusion Examples from Accenture, Nokia, Toyota, and the Australia Post on project success, although outside the construction industry, can be applied in infrastructure project management practices to avoid failures and achieve success. It is about time infrastructure project managers adapt new models such as virtual prototyping, integrated project management, fuzzy logic, and relational contractual approach to their project management practices in order to, as in Heathrow T5, achieve effective construction project supply chain management and operational success.
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References Collin, J. & Lorenzin, D. (2006) Plan for supply chain agility at Nokia: lessons from the mobile infrastructure industry, International Journal of Physical Distribution & Logistics Management, 36 (6), pp. 418-430 Gil, N. (2009) Developing cooperative project client-supplier relationships: how much to expect from relational contracts, California Management Review, 51 (2), Winter, pp.144-169 Guo, H., Li, H. & Skitmore, M. (2010) Life-cycle management of construction projects based on

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