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Article
Publication date: 28 May 2020

Satish Kumar Viswanathan and Kumar Neeraj Jha

A number of previous studies have investigated international construction project risks and have proposed risk mitigation measures without examining their interdependence…

Abstract

Purpose

A number of previous studies have investigated international construction project risks and have proposed risk mitigation measures without examining their interdependence. The purpose of the current study is to identify the influence of various risk mitigation measures on macro-level risk factors in the international marketplace.

Design/methodology/approach

The authors initially identified 26 risk variables and nine risk mitigation measures through a literature review, which were then verified for their pertinence to international projects by three experts. Subsequently, 105 questionnaire survey responses were collected and analysed using factor analysis and structural equation modelling to test the interrelations between the risk variables and mitigation measures.

Findings

The findings suggest that joint ventures with local partners is emerged as the most critical risk mitigation measure that influences the international projects, which are exposed to political, project and firm-specific risk factors. Further, it is worth noting that among the recognised risk mitigation measures in international projects, offering more local employment is the least critical mitigation measure in the international projects.

Research limitations/implications

The findings of this study are based on the macro-risk factors encountered by Indian construction firms in international projects, mostly from specific Asian and African regions. Thus, the opinions of construction firms from the developed countries might be different.

Originality/value

The main contribution of this study to existing knowledge is empirical evidence of the interrelationships between risk mitigation measures and risk factors that are portrayed as latent variables of different manifest risk variables. The generated model can assist construction firms in emphasising several risk mitigation methods, in order to reduce risk and enhance performance in international construction projects.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 9
Type: Research Article
ISSN: 0969-9988

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Article
Publication date: 29 January 2020

Satish Kumar Viswanathan and Kumar Neeraj Jha

International construction projects encompass various risks, and it is essential to evaluate and manage them to achieve project and firms’ success. As approaches to…

Abstract

Purpose

International construction projects encompass various risks, and it is essential to evaluate and manage them to achieve project and firms’ success. As approaches to addressing international market risks vary from one country to another, the purpose of this paper is to identify the critical risk factors of embarking on international construction projects according to Indian experiences.

Design/methodology/approach

After primarily verifying the identified 26 risk variables, a questionnaire survey was conducted to draw upon the views of experts who possess international project experience. The 105 responses were analyzed using univariate and multivariate techniques. An analysis of variance identified the significant variables that influence overall performance on international construction projects, which were then grouped according to underlying relationships using factor analysis to determine the specific risk factors. Furthermore, considering these risk factors as independent variables and overall project performance as a dependent variable, a stepwise regression analysis was carried out to identify relatively critical risk factors.

Findings

The results revealed that of the identified four risk factors, the project-specific risk factor emerged as the foremost critical risk factor, the economic and market-specific risk factor was the second most critical risk factor, the firm-specific risk factor was the third most critical risk factor and the political-specific risk factor was the least critical risk factor. These findings were also validated appropriately.

Research limitations/implications

This study was limited to the data acquired from Indian construction firms, predominantly consultants and contractors. Though the survey respondents possessed adequate familiarity in international construction, commonly perceived limitations in self-reported surveys such as the lack of conscientious responses and reporting bias were not an exception in this research.

Practical implications

The risk factors and their criticality – as identified in this study – can aid the multinational firms and international aspirants to prioritize the critical aspects and develop a suitable risk mitigation strategy to achieve greater project success in international market.

Originality/value

By investigating the various risk factors that influence overall performance of international construction projects, this research considerably contributes to the body of knowledge pertaining to international construction risk management that will enable firms from India and similar developing nations to emphasize on critical risk factors.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 5
Type: Research Article
ISSN: 0969-9988

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Article
Publication date: 1 June 2002

Faiza A. El‐Higzi

The construction industry in Australia is a major contributor to the national GDP. In recent years efforts to improve the industry’s performance led to the realisation…

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2852

Abstract

The construction industry in Australia is a major contributor to the national GDP. In recent years efforts to improve the industry’s performance led to the realisation that the industry needs to be internationally competitive for it to remain viable. This paper examines the nature of the Australian construction industry in the context of the international construction industry. The concept of international trade is also used to explain trade patterns in the construction industry.

Details

International Journal of Social Economics, vol. 29 no. 6
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 1 December 2010

George Wang, Huanqing Lu and Zhaomin Ren

Current construction management programmes in higher education institutions provide students with sound technical and management knowledge. However, in the twenty‐first…

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1336

Abstract

Current construction management programmes in higher education institutions provide students with sound technical and management knowledge. However, in the twenty‐first century, construction professionals need to be familiar with the cultural, environmental, and political factors that could affect international projects and know how to work effectively in the global arena. How to face the unique challenges due to rapidly increasing globalisation is the question that concerns construction educators around the world. However, current construction management curricula do not usually provide students with even basic training on international project management. To remedy this defect, globalisation components have been incorporated into construction management education at East Carolina University through lecture exchange, study abroad, student exchange, scholar exchange, and research exchange activities. This paper presents the international activities performed, the outcomes, and student growth in international construction management.

Details

Journal of Applied Research in Higher Education, vol. 2 no. 2
Type: Research Article
ISSN: 2050-7003

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Article
Publication date: 7 October 2013

Gul Polat and Befrin Neval Bingol

The main objective of this paper is to show how fuzzy logic and multiple regression analysis (MRA) techniques can be used by construction companies for determining the…

Abstract

Purpose

The main objective of this paper is to show how fuzzy logic and multiple regression analysis (MRA) techniques can be used by construction companies for determining the size of contingency that will be included in bid prices for international construction projects in a more systematic way and to compare their modelling performances.

Design/methodology/approach

The steps followed in the execution of this study mainly consists of: conducting a literature review on international construction in order to identify the factors that may affect contingency amounts that will be included in bid prices for international construction projects; developing the general framework of the proposed contingency estimation model; designing a questionnaire based on the information gathered from the literature review, delivering these questionnaires to construction experts, and obtaining the actual data of 36 international construction projects; developing a fuzzy logic model based on expert judgments and three multiple regression analysis models (MRAM) using the collected data; and comparing the performances of these approaches.

Findings

In this study, a fuzzy logic model and three MRAM were developed. Their modelling performances were compared using actual data obtained from 36 international construction projects that had been completed by 20 large-scale Turkish construction companies in 14 different countries. It is found that the developed fuzzy logic model outperforms the MRAM built for the studied projects.

Originality/value

This study shows that fuzzy logic and MRA techniques can be successfully used by construction companies, which predominantly do business in foreign countries, for estimating the size of cost contingency that will be included in bid prices for international construction projects. The modelling performances of fuzzy logic and MRAM are also compared.

Details

Construction Innovation, vol. 13 no. 4
Type: Research Article
ISSN: 1471-4175

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Article
Publication date: 19 November 2019

Guanghua Li, Chuan Chen, Guomin Zhang and Igor Martek

Factors affecting bid/no-bid decisions of international projects are more complex than those of domestic projects. The purpose of this paper is to identify and rank…

Abstract

Purpose

Factors affecting bid/no-bid decisions of international projects are more complex than those of domestic projects. The purpose of this paper is to identify and rank decision factors considered by variously sized Chinese international contractors (CICs) and categorize those groups of factors important to experienced practitioners.

Design/methodology/approach

The analysis of factors identified by a literature review is conducted based on data derived from questionnaire results received from 119 CIC project and bidding managers. The relative importance of factors is measured by mean value and standard deviation. The discrepancy in rank and importance value perceived by variously sized CICs are explored by ranking disparity analysis, non-parametric test and Spearman’s rank correlation coefficient test. Finally, factor analysis is used to categorize the underlying groups of factors considered by CICs.

Findings

In sum, 41 factors are identified through the literature review as having an impact on the bid decision. Significant disparities in ranking and importance are found in several factors, which partially affect the consistency of the ranking of factors perceived between large and small-medium CICs. Ultimately, nine major factors are identified as impacting the bidding decision, with “contractor’s capability” and “country risk of the host country,” being the most important.

Research limitations/implications

The weight of a factor considered in a decision varies across contractors as a function of contractor size. Whether using models or subjective judgment in making decisions, it is beneficial to fully understand the main groups of factors influencing the decision. Vulnerability to country risk emerges as the first criterion accessed in the bid decision.

Originality/value

A comprehensive set of factors is established for CICs, including both general factors common to domestic projects, and international factors unique to international projects. All factors are grouped by inferential analysis from the perspective of contractors, which reveals the underlying mechanism of the bid decision-making process. While the data were collected from CICs, the methodology in exploring factors, along with implications, is determined to be applicable internationally.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 7
Type: Research Article
ISSN: 0969-9988

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Article
Publication date: 29 November 2019

Jeffrey Boon Hui Yap and Sin Yi Cheah

The purpose of this paper is to investigate the major challenges faced by Chinese international contractors (CICs) in the Malaysian construction industry.

Abstract

Purpose

The purpose of this paper is to investigate the major challenges faced by Chinese international contractors (CICs) in the Malaysian construction industry.

Design/methodology/approach

An exploratory sequential mixed-methods research approach was adopted where following a detailed literature review and semi-structured interviews with local professionals, 20 prevalent challenges experienced by CICs are identified. Subsequently, a questionnaire survey was used to elicit the views of 100 construction practitioners. Descriptive statistics were used to prioritise the challenges, while exploratory factor analysis was conducted to uncover the underlying factors.

Findings

The five most crucial challenges identified relate to: changes of regulation, cost control, contract clauses, language barrier and quality control. Exploratory factor analysis revealed four major underlying dimensions of these challenges, in connection to financial and government policy management, organisational performance management, supplier relationship management and cross-cultural management.

Research limitations/implications

The challenges are considered primarily involving CICs in the context of Malaysia; further work can be extended to Western or other East Asian, such as Japanese and Korean, international contractors undertaking construction projects in Malaysia or selected developing countries around the region.

Practical implications

This study will benefit professionals involved with China-backed construction projects in countries sharing demographics and socio-economic characteristics akin to Malaysia. The outcome of the study is expected to facilitate project managers to devise proactive risk-mitigation measures to reduce the impact of these challenges and to improve project delivery.

Originality/value

The paper examined the challenges faced by CICs in the Malaysian context. This is a timely study, as China’s Belt and Road Initiative will provide considerable opportunities for Chinese companies in Malaysia.

Details

Journal of Engineering, Design and Technology , vol. 18 no. 3
Type: Research Article
ISSN: 1726-0531

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Article
Publication date: 1 April 2005

Edwin H.W. Chan and Henry C.H. Suen

Unfamiliar with the Chinese culture and ways of doing business, foreign architects/engineers/contractors (AEC) firms will encounter differences with the local parties…

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6907

Abstract

Purpose

Unfamiliar with the Chinese culture and ways of doing business, foreign architects/engineers/contractors (AEC) firms will encounter differences with the local parties. With reference to the characteristics of Chinese culture on disputes, this paper studies the problem areas of dispute and of resolving disputes in international construction projects in China. The objectives are to: examine the fundamentals of Chinese culture and ways of doing business; examine the characteristics of international projects and investigate any differences in the dispute problems arising from China International Projects; identify the most popular dispute resolution mechanism(s) for international projects in China; and recommend possible ways to reduce and resolve disputes of these projects.

Design/methodology/approach

After literature review, a questionnaire was designed for face‐to‐face interviews with 40 practitioners to collect their opinions.

Findings

The results show that the problem areas giving rise to disputes are mainly related to contractual matters. To reflect the characteristics of international projects in China, cultural and legal matters are also found to be the sources of problem. Arbitration is the most popular method, after negotiation, for resolving disputes in international construction projects in China.

Research limitations/implications

The number of interviewees in this study could be improved and further study could include experts in Mainland China.

Originality/value

There is not much literature on dispute resolution management for international construction projects in China, with particular reference to cultural differences. This paper offers an invaluable reference for those foreign AEC firms interested in joining international projects in China.

Details

Management Decision, vol. 43 no. 4
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 3 August 2021

Mershack Opoku Tetteh, Albert P.C. Chan, Amos Darko, Sitsofe Kwame Yevu, Emmanuel B. Boateng and Janet Mayowa Nwaogu

International construction joint ventures (ICJVs) are an effective strategy for construction companies worldwide for delivering large and complex projects. Despite…

Abstract

Purpose

International construction joint ventures (ICJVs) are an effective strategy for construction companies worldwide for delivering large and complex projects. Despite numerous ICJVs studies, there is a lack of comprehensive empirical examination of what drives ICJVs implementation. This study aims to investigate the key drivers for implementing ICJVs through an international survey.

Design/methodology/approach

Grounded on a comprehensive literature review and structured questionnaire survey, 123 ICJV experts' responses from 24 different countries/jurisdictions were analyzed using inferential and descriptive statistics. Mann–Whitney U test was used to determine any divergence of ranking of the drivers by the experts. Factor analysis (FA) was used to identify the clusters underlying the key drivers. Rank agreement analysis was later used to investigate the consensus between experts from developing and developed countries/jurisdictions on their ranking of the clusters.

Findings

Out of 34 factors, 26 factors greatly drive the implementation of ICJVs. Mann–Whitney U test results prove the absence of significant disparity among the experts in the ranking of the drivers. Six clusters were obtained through factor analysis (FA), namely, market-penetration and innovation-driven drivers, legal and market-driven drivers, fiscal incentives and market expansion drivers, personal branding drivers, sustainable advantage/power drivers and industrial and organizational promotion drivers. Rank agreement analysis exhibited varied levels of concurrence between professionals from developed and developing countries/jurisdictions.

Practical implications

The appreciation of the factors motivating ICJVs is beneficial to the successful implementation of ICJV strategies. A clear understanding of the drivers can help practitioners and policymakers to customize their ICJVs to reap the expected benefits.

Originality/value

The study has generated valuable insights into the factors that are greatly driving the implementation of ICJVs worldwide. While the findings of this study provide a profound contribution to theory and practice, it contributes to sustainable growth in different perspectives.

Details

Engineering, Construction and Architectural Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0969-9988

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Article
Publication date: 22 February 2013

Heng Li, Zhigang Jin, Vera Li, Guiwen Liu and R.M. Skitmore

The purpose of this paper is to provide a new type of entry mode decision‐making model for construction enterprises involved in international business.

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3101

Abstract

Purpose

The purpose of this paper is to provide a new type of entry mode decision‐making model for construction enterprises involved in international business.

Design/methodology/approach

A hybrid method combining analytic hierarchy process (AHP) with preference ranking organization method for enrichment evaluations (PROMETHEE) is used to aid entry mode decisions. The AHP is used to decompose the entry mode problem into several dimensions and determine the weight of each criterion. In addition, PROMETHEE method is used to rank candidate entry modes and carry out sensitivity analyses.

Findings

The proposed decision‐making method is demonstrated to be a suitable approach to resolve the entry mode selection decision problem.

Practical implications

The research provides practitioners with a more systematic decision framework and a more precise decision method.

Originality/value

The paper sheds light on the further development of entry strategies for international construction markets. It not only introduces a new decision‐making model for entry mode decision making, but also provides a conceptual framework with five determinants for a construction company entry mode selection based on the unique properties of the construction industry.

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