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2102 1 eussI Volume 1 WELCOME TO KAIBO

GROUP .......................... 1

KAIBO CURRENT NEWS 1-1

INDUSTY NEWS .......... 2-4

GroupKaibo Group is an international project management

(EPCM/PMC) company. Where we provide project man-

agement and consulting services to owners and Chinese

construction enterprises.

2011 in focus for Kaibo Group 2011 was a another successful

year for Kaibo Group where we

undertook engineering project

management and consulting

works on projects in Australia,

Africa, Europe and Asia at a

total value of over 4 Billion

USD. These projects received a

high degree of recognition from

all people involved from Gov-

ernment departments to the

owners involved.

During the course of the year

CEO Mr. Sun delivered key

speeches at various conferences

and events with one in particular

at 4th China International Con-

tractors Association (CHINCA)

which was widely heralded at

the event as he focused on the

cooperation model between

contractors and engineering

consulting firms.

In 2011 we started an initiative

in sponsoring disadvantaged

children in China and abroad

where we aim to provide a better

future through education. This

initiative is one of several Cor-

porate Social Responsibility

projects we actively pursue for a

better future for people not only

in China but throughout the

world.

All at Kaibo Group look for-

ward to another challenging year

in 2012 and look forward to

working together with you.

Current Projects Nigeria—We are the management contractor on a $162millionUSD railway contract where we are providing

a full range of EPC Project Management services.

Sudan—Providing project management services for a $500USD irrigation project where we oversaw the

whole project process including tendering, contract negotiation, assisting contractors and maintaining effec-

tive communication with the owner.

Mongolia— Project managing a housing development contract.

Kaibo

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The Growing Influence of Chinese Construction

Despite concerns about the quality of their work, Chinese construction companies are winning more valuable interna-tional contracts to build every-thing from roads to railways.

Richard di Bona, who runs a

Hong Kong transport consul-

tancy, said China had signifi-

cantly expanded its assistance

to developing countries, pre-

senting Chinese firms with an

inside track into many projects.

Although the value of interna-

tional contracts won by Chi-

nese firms dropped 6.5 per cent

year-on-year to US$82 billion

in the first nine months of

2010, the value of international

contracts won by Chinese

firms in 2009 was 10 times

more than 2000, according to

the China International Con-

tractors Association. By the

end of September 2010, the

cumulative total of interna-

tional contracts won by Chi-

nese firms was US$642 billion,

according to the association. In Africa, the value of Chinese construction projects jumped more than tenfold from

US$1.81 billion in 2002 to US$19.75 billion in 2008. Despite the tremendous in-crease in contracts, there have been examples of poor-quality work or safety issues in certain overseas projects by Chinese construction firms in Qatar, Ghana, Poland and Saudi Ara-bia, said an international engi-neering executive. Chinese construction firms have been able to win overseas contracts because they offer lower prices that come with financial support from Chinese state banks - such as China Exim Bank - which offer loans on generous terms, said the international engineering ex-ecutive. Chinese construction firms are highly competitive in Africa's civil works sector but not in equipment supply or construc-tion consultancy, said the Insti-tute of Developing Economies of the Japan External Trade Organization (IDE-Jetro). From 2004 to 2006, Chinese firms accounted for 31 per cent of civil works contracts in Africa awarded by the World Bank and African Develop-ment Bank. Such a percentage indicates Chinese companies

are highly competitive, as no other country has more than a 12 per cent share, said IDE-Jetro. However, Chinese firms account for only three per cent of the equipment supply mar-ket in Africa and are almost non-existent in construction consultancy in Africa. Chinese construction firms face several problems when expanding overseas, including lack of risk management and poor contract management, the professor said. One example is the light-rail project in the Muslim holy city of Mecca where China Railway Con-struction Corporation booked a 1.39 billion Yuan (HK$1.66 billion) loss. "The Chinese companies real-ize they cannot indefinitely expand overseas on the basis of cheap work and cheap financ-ing alone," said the executive.

This article is from www.scmp.com. Written by Toh Han Shih

“CHINESE CONSTRUCTION FIRMS

FACE SEVERAL PROBLEMS WHEN

EXPANDING OVERSEAS, INCLUDING

LACK OF RISK MANAGEMENT AND

POOR CONTRACT MANAGEMENT,

THE PROFESSOR SAID. ONE EXAM-

PLE IS THE LIGHT-RAIL PROJECT IN

THE MUSLIM HOLY CITY OF MECCA

WHERE CHINA RAILWAY CON-

STRUCTION CORPORATION

BOOKED A 1.39 BILLION YUAN

(HK$1.66 BILLION) LOSS. “

QUICKNEWS

CNPC signed a deal in Afghanistan to win the country first ever Oil bid.

Qingdao Kingking Group to invest $100 million to develop mines in Africa.

Pan-China Construc-tion win contract in South Sudan to design and construct new capital.

CCEC signed $1.2bil-lion for railways in Ethiopia.

UPCOMINGEVENTS

3rd IIICF—24—25 of May.

SCET—May

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1

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The China Communication Con-struction Company has won a contract from the Panama Canal Authority to design a third bridge spanning the Panama Canal.

The CCCC submitted the lowest

bid for the project at US$4.66

million, securing the contract

over five competitors, according

to Xinhua.

The Chinese company partnered

with a U.S.-based engineering

consultancy, Louis Berger Group,

headquartered in Morristown,

New Jersey. The five competitors were Pa-nama’s TYPSA Principia with a bid of USUS$4.9 million, Puente de Colon at US$7.2, U.S.-based URS Holdings at US$6.1 million,

, London-based ARUP at US$8.5 and a second U.S. firm, Ty Lin International at US$9.6 million.

The Panama Canal Authority

estimates the new bridge will

double cross-canal traffic capac-

ity when it is completed in 2014,

scheduled to coincide with the

completion of the canal expan-

sion.

PANAMA CONTRACT

WORKING

WITH KAIBO

GROUP

We Endeavour to work

with all stages of the con-

struction project providing

world class management,

consulting services, and

project management.

We also provide training

sessions to help your com-

pany achieve the best re-

sults in dealing with Chi-

nese enterprises

SINGAPORECONTRACT

China Railway 11 Bureau has

won the last two civil con-

tracts of Singapore’s Tuas

West Extension mass rapid

transit (MRT) project. The

contracts have a combined

value of US$390 million.

One involves the construction

of elevated stations at Tuas

West and Tuas Link stations

and approximately 2.2km of

elevated MRT viaducts. The

other is for the construction of

the elevated Tuas Crescent

station and approximately

2.4km of MRT viaduct, which

will be integrated with part of

a 4.8km of road viaduct.

When completed, the road

viaduct will provide motorists

an alternative to the busy Pio-

neer Road.

Tuas West Extension is an extension of the East-West Line from Joo Koon station, consisting of a 7.5km twin-tracked MRT viaduct, four above-ground stations and a depot.

Construction will start in

January 2012 and is targeted

to complete in 2016.

CONTACT

KAIBO

GROUP

Address: B1502, Vantone

Center, Chaoyang District,

Beijing (100020)

Tel: (+86)10-59073235

Email: info@kaibogroup.com

Web: www.kaibogroup.com

or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process? or cultural process?

4

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Does the emergence of an international stan-

dard, and the internationalization of other

standards including the dozen or more transla-

tions of the PMBOK* Guide mean project

management is a standard process across all

cultures and societies, or do we need cultural

versions of the PMBOK Guide similar to the

current industry extensions?

I ask this question as the ISO committee final-

izes the draft of ISO 21500, A Guide to Pro-

ject Management. The PMBOK Guide is pro-

duced in 12 official and several unofficial

translations but language is only one dimen-

sion of culture. To effectively manage pro-

jects within a specific culture do the

PMBOK’s processes need adaptation?

The original trigger for this column was the

collapse of a series of ‘binding agreements’ in

2004 between Fortescue Metals Group Ltd

(FMG), and some Chinese engineering com-

panies to build a new iron ore mine, railway

and port (worth billions of dollars). The deal

fell through when parallel negotiations around

an equity stake in Fortescue collapsed and the

final appeal to the High Court over the matter

is due shortly.

In an Western context, there were separate

negotiations and the collapse of one should

not have impacted the other. In a Chinese

context, the relationship is what matters and

the failure of one aspect of the relationship

damages all aspects of the relationship. What

this case does highlight though, is the impor-

tance of ‘culture’ when dealing with stake-

holders.

Khor Soon Kheng, founder of Asia ICT Pro-

ject Management Malaysia, believes

good Guanxi (a philosophy dealing with any

network of relationships among various par-

ties who cooperate and support one another in

the Chinese business/project world) is criti-

cally important to the successful delivery of

projects involving Chinese organizations from

bidding through to handover.

“Guanxi can rate as highly as technical com-

petence and price in decision making and has

a significant influence on procurement, Khor

says. “Guanxi is intensely personal: while it

can be shared and reflected onto the organiza-

tion a person works for, the individual ‘owns’

his/her Guanxi and has to invest time in de-

veloping and maintaining it. This gives him/

her a competitive advantage as well as the

ability to avoid conflict, both of which are

beneficial to the outcome of the project.”

But this is not just an East/West issue; we

experienced two very different approaches to

safety management during a major project

review in Pakistan. The hierarchal and proce-

dural culture of the Indian sub-continent was

quite different to the ‘team/group’ culture of

the Chinese engineering company building the

project. In this ‘culture clash’ the Pakistani

engineers were focused on documented safety

procedures, the Chinese engineers and build-

ers were focused on developing a group un-

derstanding of the risk through discussion and

observation to make sure no one in their

closely knit team was put at risk of injury;

they saw the paperwork as superfluous. Both

sides took safety seriously; the approach em-

bedded in culture to achieving the ‘safe out-

come’ was quite different.

Similarly managing issues effectively is cul-

turally sensitive. In Japan, the concept of ne-

mawashi (pre-arrangements) moves conten-

tious items forward so there are no disagree-

ments in meetings. Even making a decision

can be seen as a failure; decisions should

emerge from the group rather than be imposed

on the group by a project manager.

As the Japanese proverb says, ‘the nail that

sticks up gets hammered down’. Conse-

quently, nemawashi makes ideas such as a

PMO fearlessly reporting schedule slippage or

cost overruns at a meeting almost untenable.

The information needs to be subtly conveyed

and the actions agreed before the meeting to

maintain the integrity of the group. Depending

on your viewpoint, nemawashi can be thought

of as ‘dealing under the table’ western or as a

type of smoothing ‘finding the root of the

problem and using some Delphi technique to

circulate around the stakeholders to build

consensus’ eastern. There is no right or wrong

in culture: the Chinese ran an incredibly suc-

cessful Olympics, Japanese industry domi-

nates in many areas, and South Korea has a

long history of successful project delivery.

The key question is how much additional

value could a cultural adaptation of PMBOK

Guide contribute to the development of pro-

ject management in these and other cultures?

There are advantages to a standardized world

wide view of project management and there

are advantages to developing culturally rele-

vant adaptations. The approach favored by

Robert Higgins (another contributor

to Advising Upwards) is to clarify and sim-

plify the PMBOK to transform it into a dia-

mond of knowledge. Like a diamond it needs

to be discreet, clear and hard. The ideas in a

robust, clarified, PMBOK can be translated

easier. Clear ideas spread naturally by com-

munication, and because culture is a shared

system of beliefs or values based on a com-

mon understanding of these ideas, having one

robust and clear PMBOK is the greatest

strength for creating a global project manage-

ment culture. From this base, project manag-

ers can use the baseline culture of project

management to create common ground in a

multi-national teams and adapt to the other

aspects of culture in any location.

An alternative perspective suggests processes

that are not culturally effective get ignored or

bypassed, devaluing the overall value of the

‘body of knowledge’. With both the 5th Edi-

tion of the PMBOK Guide and ISO 21500 in

development, I feel we need to have more

discussion around implementation of the

‘knowledge’ within cultures. Can one size fit

all?

This article was taken from www.cio.com.au,

written by Dr. Lynda Bourne.

“GUANXI CAN

RATE AS HIGHLY

AS TECHNICAL

COMPETENCE”

Is project management a standard