Kurzzusammenfassung der Master Thesis

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1 Kurzzusammenfassung der Master Thesis Master-Studiengang Internationales Projektmanagement in der Prozesskette Bauen Application of Sustainability in U.S. Consultancy Firms in the Construction Industry Eingereicht von: Frances Maravelea Matriculation No: Betreuer: Prof. Dipl.-Ing. Roland Dieterle University of Applied Science Stuttgart Prof. Dipl.-Ing. Jürgen Marc Volm University of Applied Science Stuttgart

2 - 1-1 Introduction Construction activity is commonly considered to have adverse impacts on the environment, which is the basis of sustainable development for human beings. The application of sustainable practices has economic, environmental and social benefits, creating a win-win situation for both shareholders and stakeholders. In this respect project management plays a vital role in applying sustainable practices to deliver sustainable projects. Based on the limited information given in literature, the author wanted to investigate how sustainability has been applied through project management practices in the construction industry. This research involved senior project managers who worked in consultancy firms, servicing the construction sector in U.S.A. The author utilized an existing reference model which created the frame for the formulation of the interview questions. The Center for Sustainable Innovation (2006) had created a generic Corporate Sustainability Management Reference Model, based on the Triple Bottom Line (TBL) principals which encompass the economic, social and environmental aspects of sustainability. The author customized that model, by extracting the elements that are applicable to the needs and requirements of the construction industry, with the hope that the research outcome would not only inform sustainability managers but also indicate possible future research questions for management scholars in neighbouring fields. 2 Research Question, Methodology and Objectives At present, the construction industry has been widely perceived to be under-performing in each of the key sustainability theme groups: environmental, social and economic. While various papers have been written on sustainability in the construction industry, there is very little information on the role which project managers play on the enforcement of sustainable practices. Having this as a focus the following research question was formulated: How is sustainability applied through Project Management practices in U.S. consultancy firms in the construction industry? In order to answer this research question a research study was carried out. This scenario lends itself to a qualitative and exploratory research approach. Ten Project Managers from different U.S. consultancy firms were interviewed via semi-structured telephone interviews.

3 - 2 - Those firms were engaged in the disciplines of Architecture/Engineering, Landscape Architecture and Urban Planning, covering building and infrastructure projects. There were five objectives pursued in relation to the research question. The first objective aimed to critically appraise how, from the project mangers perspective, their policies impacted the stakeholders and their communities. The second objective was to evaluate how project managers defined sustainability. The third objective was to investigate if firms integrated sustainability into their core management systems. The fourth objective was to evaluate how sustainability has been applied to construction projects. The fifth and final objective was to explore to what extend were the practitioners aware of the TBL model elements presented to them. 3 Major Findings and Discussion The findings of this research were divided into four groups reflecting the structure of the Corporate Sustainability Management Model (CSMM) mentioned previously, which was developed for the purpose of this research. These four categories were: Stakeholder Relations and Impacts; Program Strategy and Operations; Education, Research and Development; Assessment, Measurement and Reporting. Examining the findings in the above group order, it was first found that project managers seem to do the bare minimums in engaging the stakeholders and the communities in their projects. In public projects the involvement was greater than in private projects. This is not the assumed approach, as literature indicated, since moving the construction industry towards sustainability would have to involve collaboration on the part of the stakeholders. Furthermore, sustainability has been about working with community partners to increase awareness. A major obstacle that was found early on in the interview processes, which seemed to have an impact in all four groups, was the lack of corporate governance involvement in most of the organizations. That gave projects managers no direction, as they had to devise their own frameworks or measuring standards for assessment. Stakeholders seemed to be the end beneficiaries of sustainable projects by reaping long term benefits. However, due to the lack of proper educational awareness, stakeholders and communities could not distinguish major differences between conventional versus sustainable projects. Sustainability was defined to mean different things to different participants, confirming

4 - 3 - what the literature indicated, as the term been hard to pinpoint to one generally accepted definition. However, most participants were aware of the TBL components, but they did not use all of the components to assess and measure sustainability in their projects and practices. Environmental and economic aspects were more measurable and took precedence over social aspects which were harder to measure, and were rather considered the effect of good practices. The general consensus was that project managers were the pivotal figures of the project processes. Educational trainings on sustainability issues were directed by most organizations towards their own project team members and immediate stakeholders. There was no indicative training on sustainability issues for members of the construction teams. This is confirmed in literature which indicated that there seemed to be a gap between consultancies and the construction trades. According to prior empirical research findings, many construction trades were well know for their low educational background compared to other sectors of the economy. Most of the participants did not seem to have indicative educational tools and processes. This is mostly due to the fact that the actual standardisation process has been very much fragmented and adapting very slow to technological progress and market development; hindering innovative technologies from getting developed and alternative paths would need to be explored. Very few organizations had official sustainability checklists to quality control their internal processes. The environmental aspects of sustainability were viewed only as they related to the life cycle costs of the project. Environmental impacts were not measured or assessed individually as to their impact on the ecological footprint, but rather as they rated on the LEED system and the local codes. This research has shown that so far environmental and social sustainability remains largely separated from the traditional core business strategies and management systems, which have been geared nearly solely towards the financial performance. Accordingly, management tools are needed that help integrate financial, environmental and social management systems. Clients identified costs as the primary decision making factor. Initial costs and life cycle costs had to be assessed when measuring the economic aspect of sustainability. Also economic sustainability was assessed by the economic stimulus the new construction brought to the region, through revitalization of the area, and the use of local labour and resources.

5 - 4 - Indications by some participants that sustainability processes were measured solely on the use of materials lead to a further examination of what the PMBOK Guide indicated as project management process and product management processes. Product oriented processes are typically defined by the project life cycle and vary by application area. Project management processes and product-oriented processes overlap and interact throughout the project. None of the organizations was doing formal sustainability reporting. Reporting in public projects was done by the public client though government publications and project reports. In the private sector, reporting was mostly internal. In evaluating the model provided for the interviews, most participants indicated that they were familiar with the TBL components, but had never put them together in such a comprehensive way. Yet they wished that it would be a task the corporate governance would undertake and establish for all future projects. Two issues from the findings stood out, which the author deemed important to explore further. These were: sustainability costs and sustainability marketing. The first dealt with how efficient environmental cost strategies can reduce costs related to inefficient environmental processes. The second was the use of progressive environmental market development strategies aiming at changes in the institutional framework which would give firms a competitive advantage over less sustainability-oriented competitors. The author considered both of these strategies important and the elements they encompassed could be integrated into the CSMM, and consequently into the core business processes. 4 Conclusion This research had been limited to a small geographical area of the U.S. the states of Michigan and Illinois - and to consultancies in the construction industry. Further research can be conducted on U.S. consultancy and construction firms on a national level or on firms that do international work. Also other actors involved in construction projects, such as project owners, and other stakeholder groups could be included. Furthermore, broadening awareness of all actors, stakeholders, industry players, and the public through access to the expertise found in local bodies of knowledge and at different institutions of higher learning, can contribute to education and awareness of sustainability.

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