Knowledge-Based Sustainable Decision-making Framework for the Implementation of Innovative Technologies in the Malaysian Construction Industry

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1 Knowledge-Based Sustainable Decision-making Framework for the Implementation of Innovative Technologies in the Malaysian Construction Industry ROHANA MAHBUB Faculty of Architecture Planning and Surveying Universiti Teknologi MARA Shah Alam MALAYSIA Abstract: - In moving towards a high-income economy, improving the people s quality of life through sustainable development is the core of Malaysia s development agenda. The use of modern machineries and innovative technologies in the Malaysian construction industry is projected in the implementation of government mega projects under the Entry Points Projects (EPPs) within the Economic Transformation Programme (ETP) where the expected benefits are seen in terms of ability to perform with optimal cost and in a shorter period of time. Despite the measures introduced by the government to encourage the use of innovative technologies such as prefabrication and mechanisation in the construction industry and the policies and incentives put in place, there has been very little research done on identifying the decision-making criteria or variables from the perspective of the users and addressing the sustainability issues in the decision to use innovative technologies in their construction process or activities. The aim of this research is to develop a sustainable decision-making framework for the implementation of innovative technologies in construction; taking into account the knowledge collaboration principles and sustainability issues that need to be considered. The scope of the research is mainly on the use of Industrialised Building System (IBS) by construction industry players in Malaysia; and the research methodology includes interviews, observations, a questionnaire survey and case studies of construction projects. This paper discusses the findings of the preliminary phase of the research, which is the interview; and analysis results indicate that the decision to acquire the technologies in Malaysia is based mostly on cost and affordability, government incentives and perceived benefits; without much consideration given on the sustainability of the decision, and the need for collaborative knowledge to sustain its implementation. Key-Words: - Construction Industry, Decision-Making Framework, Innovative Technologies, Sustainable 1 Introduction As in many countries, the construction industry is one of the most significant sectors in the Malaysian economy and is critical to national wealth creation as it acts as a catalyst for and has multiplier effects to the economy. The construction industry in Malaysia posted a growth rate of 12.3% in 2013 with total spending of US$32 billion. According to the Construction Industry Development Board Malaysia (CIDB), the industry is driven by government and private sector investments in low cost housing and infrastructure projects, particularly through the Economic Transformation Programme (ETP). In the first-three quarters of 2013, construction work for 4,253 projects worth US$21.3 billion began, of which 76.0% involve private sector participation. (CIDB, 2015 and AECOM, 2015) The government s vision for Malaysia to be a developed nation by the year 2020 has pushed forward the use of innovative technologies in most sectors and industries, including the construction industry. Focus on increasing the use of innovative technologies in the Malaysian construction industry has also been addressed under the Construction Industry Master Plan (CIMP) , including encouraging the use of Industrialised Building Systems (IBS) and prefabrication, Building Information Modelling (BIM), mechanisation, automation and robotics, and to a certain extent, modular construction. An important consideration in the implementation of these technologies is in ISBN:

2 ensuring that the decision-making process for taking these technologies on board is comprehensively outlined and organised so that the technologies acquired for the construction projects can be economically feasible and sustainable in terms of the resources management and execution. 2 Innovative Technologies in the Malaysian Construction Industry The construction industry enables the growth of other industries through its role as a fundamental building block of the nation's socio economics development. Educational institutions, government offices, some tourist attractions, transportation infrastructure (airports, seaports, roads), housing, commercial property all the essential elements of a healthy, functioning economy, need to be built and maintained by the construction industry. Besides enabling socio economic development, the construction activities generate tremendous spillover opportunities. It contributes to the growth of other industries in its role as a large user of manufactured goods (building materials, iron, steel, etc.) of specialised tooling and heavy machinery and the financial services sector. (Ibrahim et al, 2010) Historically, in Malaysia, prefabrication in terms of the use of Industrialised Building System (IBS) has always taken centre stage and highlighted as the most relevant innovative technology to be implemented in addressing the inherent problems within the construction industry such as heavy reliance on foreign labour, decreasing quality of products and inefficient processes, inferior working conditions and declining productivity. More recently, other innovative technologies that have come under consideration include the use of construction mechanisation, automation and robotics, Building information Modelling (BIM) and to a certain extent, modular construction. The scope of this research is on the decision to adopt IBS; in that the construction population are expected to have reached the maturity level required as IBS has been actively promoted in Malaysia since 1999 under the IBS Strategic Plan and subsequently the IBS Roadmap (Ministry of Works Malaysia, 2010) However, the framework produced is fairly generic in nature and can be applied to most innovative technologies application in construction. 2.1 Definition of Terms Prefabrication construction is defined differently across the globe, and in Malaysia, the term Industrialised Building System is defined as a construction system where components are manufactured at factories on or off-site, transported, and then assembled into a structure with minimum site work (CIDB, 2015). In United Kingdom, it is known as the Modern Method of Construction (MMC) whilst in Australia, the term Offsite Manufacturing (OSM) is widely used. The different terms and definitions are as described in Table 1 (adapted from Steinhardt, Manley and Miller, 2013) Table 1: Prefabrication construction terms and their context (adapted from Steinhardt, Manley and Miller, 2013) Term Industrialised Building System (IBS) Industrialised Building Modern Methods Construction (MMC) Modular Building, modular construction Offsite Manufacture, offsite manufacturing (OSM) of Context Term coined in Malaysia and defined as a construction system where components are manufactured at factories on or off-site, transported, and then assembled into a structure with minimum site work.(cidb,2015) Prominently used in Sweden and other European countries incorporating offsite manufacturing of materials, supplier coordination, and the systematisation of build processes (Lessing, Stehn and Ekholm, 2005) A construction process that encompass the use of new and traditional materials and components often with extensive factory produced sub-assembly sections and components. This may be in combination with accelerated on-site assembly methods and often to the exclusion of many of the construction industry traditional trades. (Insights Real Estate, 2015) Used widely in the UK, Australia and North America to refer to volumetric elements constructed offsite and joined together to form a permanent structure. Used widely in UK and Australia as part of construction policy documents, referring to work carried out away from the building site. Prefabrication Widely used term with varying interpretations usually referring to offsite manufacturing of buildings, or parts thereof, prior to installation of assembly onsite. Innovation is defined as new knowledge incorporated in products, processes and services; ISBN:

3 which can be classified according to technological, market, and administrative/ organisational characteristics. Technological innovation is the knowledge of components, linkages between components, methods, processes and techniques that go into a product or service. (Afuah, 1998 and Popadiuk and Chun, 2006) As such, for this research, innovative technologies in construction refer to new components, methods or techniques introduced into a construction process with the purpose of improving the existing technological practice. 2.2 Innovation and Knowledge The built environment is characterised with the intensive creation and use of information and knowledge within different mediums and participants, and across projects; which makes information and knowledge sharing a fairly complex and difficult process. Thus, introducing a new technology or techniques into such a set-up would entail the need for a comprehensive review of all the existing components and project participant characteristics to ensure that information and knowledge can be effectively disseminated throughout the project. This could also address the sustainability issues of the new technology especially if all relevant parties that are connected to the technology are always keep up to date and related information on its application regularly shared. Specialisation amongst collaborators causes concomitant problems of knowledge sharing in and between companies and project teams. Knowledge created in specific contexts such as a project is, to a large extent, situated and much experiential knowledge created in practice remains tacit and difficult to transfer. (Demaid and Quintas, 2006). Bringing in innovative technologies into a given construction process can be a challenge if the technology is to be implemented across all stages of the project, thus involving all project participants including designers, engineers and contractors. Knowledge sharing in this sense is made more difficult due to the different constraints brought about by areas of specialisation. However, if the technology is introduced within a smaller scope such as installation methods of components specific to on-site construction only, this may be easier to sustain as it involves a smaller group of participants, namely the contractor or specialist sub-contractor. 2 Decision-making Framework One of the greatest challenges in modern construction economics is in ensuring efficient decision-making is possible in varying situations.in making the decision on whether or not to acquire innovative technologies, the construction industry players are faced with the need to make short-term decisions that may have huge consequences in the long term, but they may lack a firm basis for making these decisions. According to Saaty (2007), there are two types of decisions: intuitive and analytical. Intuitive decisions are not supported by data and documentation, and may be difficult to get accepted by other, particularly because the decision maker is unable to justify it with persuasive logic. In addition, the judgments may not be rooted in anything explicit, the other participants cannot identify a place to add their knowledge, or the decision-maker himself may have difficulty in synthesizing his own and his sub-ordinates expertise. Analytical decision-making, on the other hand, can lead to shared values when used collectively within an organisation. In considering the decision-making criteria or variables from the perspective of the users i.e. the construction industry players, of acquiring innovative technologies in their construction process or activities, several issues need to be studied, such as the indicators associated with product and process. The indicators investigated under this research are: 1) Technology Infrastructure which is linked to compatibility, accessibility and availability of the technology, 2) Organisational Culture/ Practices which is linked to corporate leadership support; organisational structure, vision and size; knowledge and expertise, and lastly, 3) Setting or Environment which is linked to government policies, incentives, support systems and regulatory procedures on the use of the technologies. These indicators are then studied in context of 1) product related issues such as cost of the technology and financial implications, lack of a comprehensive database on product specification and knowledge of the technology, lack of demand and public awareness; 2) process-related issues such as shortage of expertise and resources to implement the technologies, perceived lack of government support, competition and uncertainty, and human resource development and education. (Mahbub, 2012; CIDB, 2015 and CREAM 2015) 3 Research Methodology ISBN:

4 This research uses a mixed method approach of gathering data, both qualitative and quantitative, and includes interviews, observations, a questionnaire survey and case studies of construction projects. However, this paper would only report on findings from the preliminary exploratory phase of the research, that is, findings from the interview session involving a sample of 20 construction firms of contractors, specialist sub-contractors, developers and consultants to determine their views on what they perceive as significant decision-making criteria for the adoption of innovative technologies. Specifically, these companies were asked to provide input on indicator variables for decision-making relating to technology infrastructure, organisational culture and practices, and setting/ environment with reference to product (the technology itself) and process (technology use). For the interview data, patterns emerging from a preliminary thematic analysis of the interview transcripts evolving around the research s main topic were classified into key areas, which were then further investigated through content analysis. The emphasis placed by each participant on key phrases previously identified through the preliminary analysis was studied in terms of the frequency of occurrence in the interview text document, and within context of the information gathered. The salient concepts were then ranked according to importance and cross-referenced with extracts from the interview containing the relevant phrases; to enable the significant points to be extracted accordingly. As the research is on-going, for the purpose of this paper, as mentioned before, only the preliminary results of the primary data from the interviews are discussed, and collaborated with findings from the literature review. 4 Discussions on Findings In preliminary stage one, this research explores the decision-making variables from the perspective of the users; which were ranked accordingly and used as a basis for further data collaboration that will be gathered through other previously stated research instruments. The sustainability issues and knowledge collaboration principles for the decisionmaking variables are also dealt with through systematic linkages of primary and secondary data as indicated by the main points highlighted in the literature review. The indicators are ranked accordingly as shown in Table 2, with focus on the points highlighted by respondents within each indicator as depicted in Table 3. Table 2 Decision-Making Core Indicators: Summary of Content Analysis Indicators Rank % Freq of Occurence Technology Infrastructure 1 42 Organisational Culture and Practices 2 35 Setting/ Environment 3 23 Table 3 Decision-Making Indicators: Summary of Overall Content Analysis % of Response Indicators +ve -ve Technology Infrastructure Financial Implications Availability of Technology Accessibility of Technology Compatibility of Technology Organisational Culture and Practices Corporate Leadership Support Organisational Structure, Vision and Size Knowledge and Expertise Setting/ Environment Government policies Incentives such as tax exemptions Regulatory Procedures regarding the use of the Technology Support Systems In terms of product-related decision-making criteria, most respondents agreed that comprehensive information and knowledge is required in terms of cost of the product or financial commitments required, and product specification. It is therefore essential for there to be a comprehensive information database on the technologies that is made easily available to potential users, so as to enable them to make informed decisions on which technology should be chosen that best fits their needs. For process-related decision-making criteria, shortage of resources and expertise, competition and uncertainty and the need for human resource management and education are viewed as pertinent points that should be taken into account by potential users. The respondents are of the opinion that the issue on how sustainable a decision for taking on innovative technologies depends very much on the value, relevancy and accuracy of the decisions made. Value refers to value-added advantages to the organisation when using the technology, which relates to cost optimisation of production and ISBN:

5 shorter construction period due to the use of the technology. Relevancy and accuracy refers to ease of use of the technology and how the technology best fit the organisation, its participants and their related construction processes. The decision to use innovative technologies can therefore be sustainable and the organisations will continue to use the technology if value, relevancy and accuracy exist. However, the findings show that the majority of respondents placed less emphasis on the sustainability and knowledge sharing principles within the decision-making process, as most have indicated that they will take on the technologies as long as it is affordable, and they are able to take advantage of government incentives and perceived policy benefits, regardless of the long-term sustainability of the decision and its related knowledge collaboration. From the criteria gathered from the literature review and preliminary primary data findings, the decision-making framework for the implementation of innovative technologies in construction was produced, as depicted in Diagram 1. 5 Conclusion In today s global economy, the use of innovative technologies in the construction industry is made relevant due to the increasing need of addressing the inherent problems within the industry related to decreasing quality of products and inefficient processes, inferior working conditions and declining productivity; so as to enhance market competitiveness. The sustainable decision-making framework for the implementation of innovative technologies in construction subsequently developed from both preliminary primary data and literature review has shown that the core indicators include technology infrastructure; organisational culture and practices; and setting or environment. Within these indicators, knowledge collaboration and sharing issues were also investigated in terms of product and process. Analysis results indicate that the decision to acquire the technologies in Malaysia is based mostly on cost and affordability, government incentives and perceived benefits; without much consideration given on the sustainability of the decision, and the need for collaborative knowledge to sustain its implementation. Other concerns such as the need for a comprehensive database of information on product specification and costs that is made easily available to potential users also have to be taken into consideration to ensure that users are able to make informed decisions on which technology to choose that best fits their needs. In addition, knowledge can also be best disseminated and shared through better human resource management and education to enhance the capacity and capability of industry players. Sustainability in the decision-making process can therefore be assured if these concerns are addressed by the governing bodies within the construction industry. Acknowledgement: The author wishes to acknowledge the Ministry of Education Malaysia and Universiti Teknologi MARA for the Fundamental Research Grant Scheme ref no: 600- RMI/FRGS 5/3 References: [1] Afuah, A. (1998) Innovation Management: Strategies, Implementation and Profits, New York: Oxford University Press, 1998 [2] AECOM, Asia Construction Outlook 2014, < raphies/asia/downloads/asia%20construction %20Outlook_2014.pdf> accessed 30 June 2015 [3] Construction Industry Development Board Official Website, < accessed 30 June 2015 [4] Construction Research Institute of Malaysia Official Website < accessed 30 June 2015 [5] Demaid, A. And Quintas, P. (2006) Knowledge Across Cultures in the Construction Industry: Sustainability, Innovation and Design, Technovation 26, pp [6] Ibrahim, A.R., Roy, M.H., Ahmed, Z. And Imtiaz, G. (2010) An Investigation of the Status of the Malaysian Construction Industry, Benchmarking: An International Journal, 17(2), pp [7] Insights Real Estate (2015) Modern Methods of Construction (MMC), Zurich < content/uploads/2014/03/risk-insight-modern- Methods-of-Construction.pdf> accessed 30 June 2015 [8] Lessing, J., Stehn, L. And Ekholm, A. (2005) Industrialised Housing: Definition and Categorisation of the Concept, 13 th Proceedings of International Group for Lean Construction Conference, Sydney, Australia [9] Mahbub, R.(2012) Readiness of a Developing Nation in Implementing Automation and Robotics Technologies in Construction: A Case Study of Malaysia. Journal of Civil Engineering and Architecture, 6(7), pp [10] Ministry of Works Malaysia (2010) Roadmap for Industrialised Building System (IBS) in ISBN:

6 Malaysia , Construction Industry Development Board Malaysia [11] Popadiuk, S. and Chun, W.C. (2006) Innovation and Knowledge Creation:How Are These Concepts Related?, International Journal of Information Management 26, pp [12] Saaty, T.L. (2007), Fundamentals of Decision Making and Priority Theory with the Analytic Hierarchy Process, RWS Publications [13] Steinhardt, D. A., Manley, K., & Miller, W., (2013) Reshaping Housing The Role of Prefabricated Systems, 2013 <cms.qut.edu.au> accessed 30 June 2015 Diagram 1: Knowledge-Based Sustainable Decision-Making Framework for the Implementation of Innovative Technologies in Construction ISBN:

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