39900498 issues of managing ict projects in construction environment

Paper presented in International Project Management Conference 2003 Kuala Lumpur

Issues Of Managing ICT Projects In Construction / Infrastructure Project Environment

Ho Min Khang

Perunding Eagles Consulting Engineers

Abstract Information and Communication Technology (ICT) is beginning to be more frequently included as part of some large-scale construction / infrastructure project in Malaysia. The examples of these projects are the airport, highway, smart home, intelligent building and car park projects. This paper explores the differences of a typical construction / infrastructure projects and an ICT project; various perspectives of project management are being explored: project management scope, technical uncertainty, critical success factor, industry, and management focus. Issues of combining an ICT project into a construction project are discussed from a construction project manager perspective and an ICT project manager managing an ICT project manager perspective. Users’ involvement, sub-contractor coordination, risk management, communication and project cultural issues are explored.

Introduction There is an increasing trend in Malaysia, that projects on Information and Communication Technology (ICT) are included as part of the infrastructure or construction turnkey project. This paper will focus on discussing the unique issues faced by project managers when managing ICT project in the construction environment. The paper will: 1. Look into a few examples of these ICT projects in the construction / infrastructure project

environment. 2. Compare the differences in managing construction / infrastructure projects and ICT projects. 3. Explore in detail the issues of managing ICT projects in the construction industry

Construction / Infrastructure Projects with ICT input Traditionally, construction / infrastructure projects and ICT projects are implemented separately. However, as the demand for intelligent buildings or infrastructure increases, more ICT systems are required to be incorporated into these buildings or infrastructure as part of the project deliverables. These ICT systems are to allow operators / owners of infrastructure / building to operate the businesses. Here are a few examples: Airports are no longer only built with basic runways, hangers and passenger complexes. Kuala Lumpur International Airport (KLIA) has been built with Total Airport Management System (TAMS). TAMS integrated more than 40 sub-systems of in the airports. Some of the sub-systems are: � Advanced navigation and control systems,


� Intelligent building systems that can switch on or off air-conditioning and lighting systems for passengers waiting lounges based on the timing of various flights

� Flight Information Display Systems that provide timely flight information to passengers � Complex baggage handling systems that automate the many traditional luggage handling Today, highways are constructed with many state of the art ICT systems such as: � Several Highways around Klang Valley have Traffic Control and Surveillance Systems

(TCSS), with Variable Message Signs (VMS), Close Circuit TV (CCTV) and traffic detectors (REAM, 1999) that allow highway operators to manage highways more efficiently

� Revenue Collections Systems, which consist of the point of sales system, prepaid system, such as Touch and Go, and traffic counting system at every toll plaza in Malaysia ( REAM, 1999), to collect revenue for highways operators.

Even car parks are incorporating parking management systems to manage parking revenue and inform the motorist about the number of vacant spaces available at the entrance of the car park( REAM, 1999). Residential homes and commercial buildings today have smart home systems, building management systems, and state of the art security systems. These are all part of the housing development and commercial building projects.

Managing ICT project and construction / infrastructure project – the differences Why does managing an ICT project in a construction and infrastructure project environment require special attention? To get a better picture, let us first look at the differences in managing an ICT project and a construction / infrastructure project. The differences between the two can be summarized in the table below and the details are discussed in the succeeding sections: Construction Project ICT Project Technology: Established

Technology - High

Critical Success Factor: Effective utilization of labor material and equipment

Critical Success Factor: User involvement, skill and experience resources and technical risk management.

Industry: Highly regulated

Industry: Dynamic

Project Deliverable: Tangible Product

Project Deliverable: Intangible Product


Technology A construction /infrastructure project’s technological uncertainty ( Shenhar, A, Renier, J and Wideman, 1996) is normally low. See. Figure 1. It is based on established technology. Projects such as building construction and road building projects rely on existing and well-established base technologies to which all industry players have equal access. Many contractors can do the work and competition for the work is high. Therefore, the expectation of the customer is to have an acceptable product to be used for traditional purposes. What they want is to have their requirements met through standard solutions at minimum cost.

An ICT project normally is of high technology content. Due to rapid technological change, many ICT projects involve new technology, development of new product, or customization / improvement on established technology. The customers therefore expect significantly improved capabilities, good return on investment. The technical risk is high. Project cost overrun is always a result of technical difficulty. As ICT projects have higher technological uncertainty than construction / infrastructure project, ICT project manager ( Shenhar, A, Renier, J and Wideman, 1996) are more involved in engineering and design-related issues such as design cycles, design freeze points and system engineering.

Program/Project Management Scope

Technological Uncertainty

Increasing Technical Skills Flexibility Development and Testing Late Design Freeze Technical Communication Risk and Opportunity

Increasing : Size Scope Control Planning Subcontracting Documentation Bureaucracy

Increasing Multi-System Planning System Engineering Systems Integration Configuration Management Design Cycles Risk Analysis & Management

Complex

Simple

Low High

Figure 1: Project Management Trends along Scope and Uncertainty Dimension ( Shenhar, A, Renier, J and Wideman, 1996)


Critical Success Factor The success of a construction / infrastructure project is dependent on how effective the labor, material and equipment is being utilized. The project manager has to ensure there is sufficient:

� manpower � material � local infrastructure to support worker

However, more manpower and material does not necessary guarantee the success of an ICT project. User involvement, skilled and experienced resources and technical risk management is critical to the project success. Lack of user involvement has always been the major factor of ICT project failure. The ICT systems to be delivered have to meet the business and operational goals. Therefore, without user involvement from the early stage of an ICT project, it is very likely that the system delivered at the end of the project does not meet the user’s needs and expectations. Moreover, new requirements or requirement changes at the later stage of project will either delay the project or increase the project budget. Skilled and experienced resources, and effective technical management are critical to ICT project success as well.

Industry The construction /infrastructure industry is a highly regulated; law and engineering standards are in place for specific minimum product expectation, while professional architects and engineers are expected to review and certify design and product delivery.

The ICT industry, on the contrary, is a very dynamic industry. Standards only exist to specify system interface to ensure system interoperability. There is nothing to define product quality standards.

Product Deliverables Construction / Infrastructure projects are dealing with “tangible” products ( Shenhar and Wideman, 1997 ). The project deliverables’ primary value is in the physical artifact. It is the value of the artifact that distinguishes it from other products. As construction / infrastructure projects are based on established technology delivering tangible products, meeting the project schedule and budget are ( Shenhar and Wideman, 1996) the most critical project management objective. ICT projects are delivering “intangible” products. Its value is ( Shenhar and Wideman, 1997 ) in its intellectual property. Although there are some physical results, this is not the essence of the product. The essential feature is new information and its physical aspect is only a vehicle for its conveyance and transformation. Since the project is delivering intangible products, project success measures are based ( Shenhar and Wideman, 1996) on how the system benefits the customer such as:


• fulfilling customer’s needs • solving customer problem • customer is using the product • business / commercial success • revenue and profits enhanced

Customers of these intangible product projects, however are ( Shenhar and Wideman, 1996) more tolerable of project schedule and budget overrun.

Issues Project managers of ICT and Construction / Infrastructure projects come from two very different industries. Their project management styles and perception of projects are different. When including an ICT project as part of a large construction / infrastructure project, the two different project management styles, cultures, communication methodology and expectation meet. Some unique issues have therefore arisen:

1. User involvement 2. Design 3. Communication 4. Managing Change 5. Subcontractor Coordination 6. Risk Management

Here is a typical scenario of ICT project in a construction environment:

A client awards a large construction/infrastructure project to a main contractor. This main contractor will appoint the necessary consultants and architect during the design stage. When the design is completed, the project will be divided into various sub-projects, and be awarded to the various sub-contractors who are the specialist in that particular field. Typically, there will be sub-contractors to do the civil and structural work, various mechanical and electrical systems, and ICT related systems.

Client

Main Contractor

C & S Sub-Contractor

M & E Sub- Contractor

ICT System Sub- Contractor

Consultants


Here, we shall explore two common scenarios:

Main Contractor’s Project Manager It is most likely that the project manager of the main contractor who oversees the ICT System Sub-contractor comes from the construction industry. In this scenario, this project manager will most likely apply the same project management style in overseeing an ICT System project: � The expectation of product delivery is meeting the basic standard requirement

specification � More concerns about physical equipment delivery than designing a system that meets

user requirements � More focus on scope, sub-contract management rather than technical management This will create the following issues: 1. User Involvement: As the project management mainly focuses to deliver the basic

standard product, the emphasis to involve users in the system design stage will be neglected. On the other hand, an ICT system project requires the involvement of users to: � Obtain business and operation requirements � Design and user interface review and feedback This “gap” will lead to the project delivering a system that does not meet user requirements.

2. Design: � As the construction project generally takes a shorter time to design and a longer

time to construct, the project manager may tend to pressure the ICT system sub-contractor to move into the system development stage prematurely. In an ICT project, a major proportion of the project time is spent in the design stage, with numerous cycles of design review stages before the system is developed or built.

� The construction/infrastructure manager normally underestimates the user-involvement time required in the design stage. This is because the reviews of design in the construction industry are normally the responsibility of the architect and consulting engineers. In an ICT system project, there is no professional to review and certify the design. The quality of design is in the hands of the users and the system designers. The project manager must ensure: � Sufficient interaction between users and designers, � To allow users to have sufficient “preview” of what the system looks like � To allow designer to understand and visualize how the users will use the

system to achieve their business goal.

3. Managing Change: When managing an ICT system project, the construction project manager must be prepared to deal with change:

� The business goal is like a moving goal post; the user requirements are continuously changing as the project progresses.

� The system design is changing as users understand more about the system, and the designers have a better understanding of what the users really need as the project progresses.

� The technology is continually changing, making the product specified to be obsolete even before the system is handed over.


� Estimating the cost of change is another challenge. It is difficult to estimate the cost of the system functional change, as there is hardly any practical yardstick to software cost estimation.

4. Sub-contractors coordination: Coordination with other contractors is another set of

problems: construction based sub-contractors such as building, ducting, air conditioning, electrical all need ICT constructors inputs at a very early stage of the project. For example:

• The architect and building sub-contractor needs the dimension and space requirements of the computer room.

• Air-conditioning, electrical sub-contractors and consulting engineers need computer room operating environment requirements, power requirements.

• The sub-contractor who is building the ducting and cable risers would need the cable ducting requirements.

Such requirements are normally needed in the early state of ICT system design, when the ICT sub-contractor may not be ready to provide a firm requirement. Sometimes, such requirements are needed when the ICT contract has not been awarded yet. Some of such requirements are difficult and costly to revise, especially after concrete is poured.

5. Risk Management: The construction project manager needs to pay special attention

when managing the risks of an ICT system project: � Warranty and License: ICT system warranty is normally short and software

license may be need renewing yearly. The project managers need to ensure that software licenses and hardware warranty starts only after handover rather than when the sub-contractor delivers and get paid for the product.

� Technological risks in an ICT project is significantly higher than construction project: - The use of state of the art technology normally means use of

unproven and immature technology. New technical issues and problems will arise and delay the project.

- Putting different sub-systems and components that have not been integrated before poses project system integration risk. When one of more sub-systems face interfacing problem, the project is delayed.

- As previously mentioned, failure to capture the real user requirements will lead to delivering a ”white elephant”. Special attention is needed to ensure users are involved in the system design activities right from the start of the project.


ICT Subcontractors’ Project Manager In the construction environment, the project manager of an ICT sub-contractor will face some unique challenges compared to some other ICT projects: 1. User involvement: It is extremely difficult to obtain user involvement and

requirement in the construction project environment: � It is very common that a large-scale construction / infrastructure project starts

without the operational entity being organized yet. In this case, the users who are supposed to provide the business and operational requirements do not exist until the later stages of the project. In such cases, it is important to include a consultant who can provide business and operational insight to the ICT design team to fill in the gaps of not having users.

� It is also very difficult to get the attention of the users to focus and visualize the operational scenario when everyone in the project is still very focused on the physical construction, such as when the land will be cleared, when is the building is going to be up.

2. Sub-contractors coordination: Most of the ICT projects are implemented in ready facilities, such as completed and operational buildings. In the construction project environment, there would not be any facilities to house the computer equipment, this is an additional dimension of project coordination: � The project manager has to work closely with other construction sub-contractors.

Requirements such as computer rooms spacing, computer electrical consumption, ducting and cable riser requirements have to be provided to the construction contractor at the early stages of an ICT project. This may be difficult as these requirements have to be finalized before the ICT user requirement is captured and its design is completed

� The ICT project manager must realize that the requirement provided to the construction subcontractor will be difficult to change, in contrast to ICT requirement. After the concrete is poured, changes will be extremely expensive. Therefore, changing such requirements will normally translate into project variation orders and claims.

� Due to tight project schedules, ICT project managers may have to take the risk of voiding the equipment warranty by installing their equipment at the facilities where there is no stable power or air conditioning.

3. Communication: ICT project managers will have to deal with cultural and communication differences of construction based clients, consultants and contractors: � Email communication delay: Most of the ICT project communication is through

email; even meetings are conducted through the Internet. However, the use of email and Internet in the construction industry in Malaysia is not common. Even though the person has an email account; it is likely that the email is not checked frequently. It is best to communicate using the fax and handphones to avoid project miscommunication or delays.

� It is most important to communicate to the client and main contractor about the importance of user involvement. In the construction industry, users have very little involvement in the project; design and testing the product delivered are normally conducted by architects and engineering consultants.

4. Risk Management: An ICT project manager needs to take the following considerations while undertaking project risk management : � Damages and Claims – the ICT project in the construction environment is

exposed to potential physical damages such as fiber optic damages by


uncoordinated construction work; equipment damage by unstable power supply. Other contractors for providing incorrect requirements for space, cable riser and conduit also expose the ICT project to claims.

� Other additional factors that can contribute to project delays include: � Land – acquisition of land for construction may delay entire projects for

months and years � Public Scrutiny – some large-scale construction projects may be subjected to

public scrutiny for various issues such as removal or relocation of squatters on site and environmental issues.

Conclusion Managing a construction and an ICT project is very different in many aspects. Construction and Infrastructure project management is concerned with effective management of scope, sub-contract management, effective utilization of material, labor and project infrastructure. When managing an ICT project, it is about effective technical management of user requirement capture, understanding of business and operation goals and technical risk management. When an ICT project is included as part of a large-scale construction infrastructure project, many unique issues arise. To manage an ICT project successfully in such environment, the following have to be achieved:

� Effective management of communication to bridge cultural and expectation differences of construction and ICT industry.

� Good understanding of the risk, project requirements and expectation of both the construction and ICT industries, in order to plan and control the project implementation effectively

� Addressing user involvement issues by having key users or business/operation consultant as part of the design team

� Effective coordination between ICT sub-contractors and construction sub-contractors. It is best to achieve this through coordinators who can understand these requirements of both industries, and communicate in the wavelength of the same.

� Technology Planning: Keep it simple! It is important to keep the ICT implementation in the construction environment as simple and practical as possible. This is because many business and operational requirements will never be clear until the users start their business operation. It is best to first implement a simple, yet flexible system for future expansion and modification system first, and allow the users to further improve the system after handover.


References: Shenhar, A, Renier, J and Wideman, (1996) “Project Management: From Genesis to Content to Classification” INFORMS Conference, Washington DC. Shenhar, and Wideman, (1997) “Towards a Fundamental Differentiation between Project Types”, PICMET’ 97 conference “Innovation in Technology Management” The Key to Global Leadership”, Oregon. Shenhar, and Wideman, (1996) “Improving PM: Linking Success Criteria to Project Type”, Symposium “ Creating Canadian Advantage through Project Management”, PMI, Calgary. REAM, (1999) “ITS Strategic Plan for Malaysia – A Way Forward”, Road Engineering Association of Malaysia .

The Author Profile: �

Mr. Ho Min Khang is an associate of Perunding Eagles. He holds a Bachelors’ degree in Computer Science and a Masters’ degree in Information Technology Management. His illustrious career began in an information technology firm of Federal Computer Services in 1992 where he joined as system engineer. He was responsible for many computer-telephony projects and traveled extensively in the Asia Pacific region.

Mr. Ho joined Sapura in 1995, as a system design engineer for the Kuala Lumpur International Airport (KLIA) Total Airport Management System (TAMS) project. In this project, he was coached and mentored by many experienced American project consultants to manage the large scale system integration project. He received a triple promotion in the midst of project and was responsible in managing many of the sub-system projects. Subsequently, he was responsible for many other Sapura’s high profile projects such as the Smart School Project and the Electronic Government Project. He joined Perunding Eagles a few years ago, and is currently heading the Intelligent Transportation System Division and managing the few of the company largest projects, namely Integrated Transport Information System (ITIS) for Klang Valley and Penang State Intelligent Transport System Conceptual Study. He is active in the project management community and currently holds the position of Director of Programs in the Project Management Institute, Malaysian Chapter. Contacts: [email protected]

39900498 issues of managing ict projects in construction environment

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