CONSTRUCTION ECONOMICS AND ORGANISATION · PDF file7th Nordic Conference on Construction Economics and Organisation Trondheim June 12-14, 2013 Editorial Board Ole Jonny Klakegg, Norwegian

Ole Jonny Klakegg, Kari Hovin Kjølle,Cecilie G. Mehaug, Nils O.E. Olsson,Asmamaw T. Shiferaw, Ruth Woods(editors)

PROCEEDINGS FROM

7TH NORDIC CONFERENCE ON

CONSTRUCTION ECONOMICSAND ORGANISATION 2013

GREEN URBANISATION– IMPLICATIONS FOR VALUE CREATION

TRONDHEIM12–14 JUNE 2013

7th Nordic Conference on Construction Economics and Organisation

Trondheim

June 12-14, 2013

Editorial Board

Ole Jonny Klakegg, Norwegian University of Science and Technology, Norway

Kalle Kähkönen, Tampere University of Technology, Finland

Göran Lindahl, Chalmers University of Technology, Sweden

Suvi Nenonen, The Aalto University School of Science and Technology,

Kim Haugbølle, Danish Building Research Institute, Aalborg University, Denmark

Stefan Christoffer Gottlieb, Danish Building Research Institute, Aalborg University, Denmark

Kristian Widén, Lund University, Sweden

Christian L. Thuesen, Technical University of Denmark, Denmark

Kari Hovin Kjølle, Sintef Byggforsk, Norway

© Construction Researchers on Economics and Organisation in the Nordic region (CREON) & Akademika Publishing, 2013 ISBN 978-82-321-0273-0 (online publishing) This publication may not be reproduced, stored in a retrieval system or transmitted in any form or by any means; electronic, electrostatic, magnetic tape, mechanical, photo-copying, recording or otherwise, without permission. Layout: Cover: Ole Tolstad Foreword, introduction and paper template: The editors Akademika Publishing NO–7005 Trondheim, Norway Tel.: + 47 73 59 32 10 www.akademikaforlag.no Publishing Editor: Lasse Postmyr ([email protected])

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We wish to thank the following for their contributions to the conference.

Scientific Committee

Amund Bruland

Anandasivakumar Ekambaram

Anders Björnfot

Anita Moum

Anne Katrine Larssen

Anne Live Vaagaasar

Antje Junghans

Aoife A.M.H. Wiberg

Asmamaw T. Shiferaw

Begum Sertyesilisik

Birgit Cold

Bjørn Andersen

Bjørn Petter Jelle

Børge Aadland

Chris Harty

Debby Goedknegt

Eli Støa

Erling Holden

Eva Amdahl Seim

Geir K. Hansen

Georgio Locatelli

Gunnar Lucko

Hans Lind

Hans Petter Krane

Hedley Smyth

Helena Johnsson

Ibrahim Yitmen

Inge Hoff

James Odeck

Jan Alexander Langlo

Jarrko Erikshammar

Johan Nyström

Kim Haugbølle

Kirsten Jørgensen

Knut Boge

Kristian Widen

Lena Bygballe

Linda C. Hald

Marit Støre Valen

Mats Persson

Matthias Haase

Mette Bye

Natalie Labonnote

Nils Olsson

Ola Lædre

Ole Jonny Klakegg

Ole Morten Magnussen

Per Anker Jensen

Per-Erik Josephson

Peter Love

Poorang Piroozfar

Pouriya Parsanezahad

Ricardo Dornelas

Rolee Aranya

Rolf André Bohne

Ruth Woods

Siri H. Blakstad

Stefan Gottlieb

Stefan Olander

Suvi Nenonen

Søren Wandahl

Thomas Berker

Tommy Kleiven

Tore Haavaldsen

Wenting Chen

Øystein Husefest Meland

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Editorial Board

Ole Jonny Klakegg, Norwegian University of Science and Technology, Norway

Kalle Kähkönen, Tampere University of Technology, Finland

Göran Lindahl, Chalmers University of Technology, Sweden

Suvi Nenonen, The Aalto University School of Science and Technology,

Kim Haugbølle, Danish Building Research Institute, Aalborg University, Denmark

Stefan Christoffer Gottlieb, Danish Building Research Institute, Aalborg University, Denmark

Kristian Widén, Lund University, Sweden

Christian L. Thuesen, Technical University of Denmark, Denmark

Kari Hovin Kjølle, SINTEF Byggforsk, Norway

Editors

Ole Jonny Klakegg, NTNU Kari Hovin Kjølle, SINTEF Cecilie G. Mehaug, NTNU Nils O.E. Olsson, NTNU Asmamaw T. Shiferaw, NTNU Ruth Woods, SINTEF Organising Committee

Ole Jonny Klakegg, NTNU Kari Hovin Kjølle, SINTEF Cecilie G. Mehaug, NTNU Nils O.E. Olsson, NTNU Asmamaw T. Shiferaw, NTNU Ruth Woods, SINTEF Pangiota Kostara, NTNU Program Committee

Petter Eiken, Bygg21 Øivind Christoffersen, Statsbygg Kim Robert Lysø, Skanska Christian Joys, Avantor Bjørn Sund, Advansia Morten Lie, Direktoratet for byggkvalitet Terje Bygland Nikolaisen, Cowi

7th Nordic Conference on Construction Economics and Organisation 2013

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7th Nordic Conference on Construction Economics and Organisation, Trondheim 12.-14. June 2013

FOREWORD

The first Nordic Conference on Construction Economics and Organisation was held in Gothenburg at Chalmers University of Technology back in 1999. Since then, the conference has been held biannually (with the exception of 2005) in Sweden (4 times), on Iceland and in Denmark. Now it is Norway's turn to host the conference, and Finland is scheduled to take over the baton next time. We are very pleased to be carrying on the tradition, and we hope to live up to the expectations created by previous conferences.

In 2011 in Copenhagen an initiative was taken that marked a shift in the organization of this series of Nordic conferences: CREON was founded. The first general assembly was held during the 6th Nordic conference. The CREON network is a voluntary, non-profit association for people who study, work, teach and do research about all aspects of management and construction. The CREON network aims to promote collaboration across Nordic knowledge institutions and this series of conferences is an important activity for CREON. NTNU and SINTEF, as local organizers, are proud to present the 7th Nordic conference on behalf of CREON.

We, the organizers, had two specific ambitions when we started preparing for this conference: Firstly, we wanted this conference to be acknowledged as a high quality academic conference. We have therefore put a lot of effort in the review process. Three rounds of blind reviews is a lot of work, but now when we see the result – it was worth it. The close collaboration with Akademika Publishing makes sure publication points can be awarded to the authors. The papers are presented in two parallel sessions over three days here at the NTNU Gløshaugen campus.

Secondly, we wanted to establish a closer connection with the construction industry. We therefore put together a very strong Program Committee, comprising of prominent representatives from the Norwegian Construction Industry, who identified the main topic: Green Urbanization – Implications for Value Creation. We realized that it was not realistic to turn an academic conference into a popular construction industry event, so we have chosen to collaborate with NTNU in marking their new initiative for improving knowledge about the building process. Thus the idea for the Building Process Day was born – we will spend half a conference day together with distinguished guests from the Norwegian construction industry. The building process day will also be the scene for another conference innovation: Statsbygg awards for best paper and best young researcher. Enjoy!

Ole Jonny Klakegg, Kari Hovin Kjølle, Cecilie G. Mehaug , Nils O.E. Olsson, Asmamaw T. Shiferaw, Ruth Woods (Editors).


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INTRODUCTION, CONTEXT AND SUMMARY

The construction industry plays an important role in society. Construction forms our physical surroundings and creates the infrastructure we need to develop society. Physical infrastructure and buildings represent approximately 70 per cent of Norway's Real Capital. Public investments in infrastructure constitute half of all infrastructure investments in Norway. It is also a major factor in the society’s economy, representing a substantial share of the GNP, and, for example, it represents approximately 30% of the employment in Norway. According to Statistics Norway the construction sector is the third largest industry in Norway, employing 350,000 workers in more than 75,000 enterprises, and has a high turnover; over NOK 308 billion in 2011, approximately the same level as 2008 which was a top year. The Confederation of Norwegian Enterprise (NHO) states that the construction industry in Norway provides 10% of the total value creation. The construction industry is truly a cornerstone of our society.

On the other hand the dwellings and construction industry is also mentioned as “the 40% industry” by the Ministry of Local Government and Regional Development. This is a reminder that the construction industry uses approximately 40% of the total energy in our society, 40% of the materials, and produces about 40% of the waste that goes into landfills. This indicates the industry’s importance in relation to climate and other environmental challenges. If there is one industry that really can make a difference, it is probably construction.

Furthermore, the construction industry has a reputation of being conservative, having a low degree of innovation, and low productivity. It is not known to be the first industry to implement sustainable solutions. The construction industry does use low-tech solutions and employ low skilled workers, but it does also include highly advanced New Tech solutions to technical problems and engage some of the most qualified engineers in our society. The truth about this industry is as complex as the problems it is trying to solve on behalf of society.

In the next ten years, growing globalization will promote an already increasing trend of competition among international construction companies according to The Federation of Norwegian Construction Industries (BNL). Additionally, Norway has the following challenges ahead:

Growing population, expected to surpass 7 million by 2060, up from today’s 5 million

Increasing trend towards centralisation

Growing elderly population with needs for health care and housing

More pressure on transport infrastructure

An ever increasing immigrant workforce


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Long cold winters and harsh climate, worsened by climate change which may lead to more floods, landslides and frequent winter storms

All these challenges will lead to:

High demand for new dwellings

Need for higher investment in low energy buildings

Need for more robust buildings and infrastructure

Need for more investment in transport infrastructure

Need for a larger workforce and recruitment in all sectors

Need for good integration programmes, development of expertise and training in relevant areas for new migrants and unskilled labour.

These are the sort of challenges that the Program Committee saw when they discussed the profile for this event back at the beginning of 2011. They called it Green Urbanization. The situation calls for new solutions, new knowledge, new thinking. Both small steps and huge leaps help as long as they lead in the right direction. Is the construction industry ready for it?

The sector is fragmented and contains many small enterprises. Thus, large companies account for a smaller share of the construction output in Norway than in most other countries. Small companies with highly specialized competence indicate a fragmented industry. The typical construction project is also said to be one-of-a-kind at a hectic pace. It is obviously hard to optimize process and solutions in such an environment.

Although to a lesser degree than other countries, the Norwegian construction industry is currently facing the challenges that have followed the 2009 financial crisis; small enterprises lost competence due to temporary redundancy and the investments were at a minimum level. Therefore, the diffusion of new knowledge and investments was also at a minimum. To what degree is the construction industry equipped to meet challenges ahead? And to what degree is the academic community able to help this industry overcome its challenges? These are questions that deserve to be asked, and perhaps some answers or indications may be found among the contributions to this conference? Are the academic resources ready for it?

This introduction, its examples and identified challenges are chosen from the Norwegian context, in full awareness of the current peculiarities of the Norwegian situation. We do have a special and advantageous position, but Norway is still clearly a distinct part of the Nordic context. We are also deeply embedded in the bigger international economy and global community. Therefore, the conference profile and the Nordic conference setting feel highly relevant in 2013.


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The contributions span a wide range of issues, organized in three tracks with three major themes in each:

Sustainable Development of the Urban Environment

Organizing for Execution Efficiency in Construction

The Sustainability Perspective Governance and Strategy Implementation

The Human Aspect in Construction

Sustainable Design Decision Making and Relations Productivity and Quality

Sustainability and People Learning from Construction Projects

Supply Chains and Planning

The first track; Sustainable Development of the Urban Environment is the signature track of this conference. It relates directly to the challenges addressed by the program committee back in 2011. The invitation to authors included contributions on sustainability in a wide sense – the concept of sustainability, the framework conditions defined by government and international agreements, the built environment, both the upgrading of existing buildings and finding solutions for future built environments. As the papers of this track shows, the authors cover these issues from several perspectives and cover a wide range of issues as intended. The track provides a varied and thought provoking approach to the term "sustainable"; one of the most oft-used terms in the construction industry today, but which also continues to be one of the most important issues.

Key issues addressed by the papers are; different challenges in combining urbanization and environment respect, the role and use of green certification systems, the role of sustainability in project management, passive house building, renovation and retrofitting from a sustainable perspective and the development of new technology to the deal with climate and age related problems in building materials. Green has become an important issue and two papers look at the role of green certification and policy in stimulating company activity. It can on the one hand, as one paper suggests, become a catalyst, stimulating more green certified buildings. On the other hand, green may mean, as the second example shows, following the market rather than focusing on policies which benefit clients and society. Encouraging a sustainable build is a theme which may be understood as central in this track; it is present in the aforementioned papers and also plays a role in the papers which focus on retrofitting, project management and the building of passive houses. Further issues are exploring the difference between project management success and project success; analyzing collaborative working and experienced effects on the energy performance of a building project; an analysis of existing Norwegian retail development and their impact on local energy consumption; and the effects of user involvement in the briefing and design of a workplace. Scandinavian and particularly Norwegian examples


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dominate the papers, but there are also case stories from USA and China and contributions from the Netherlands and the UK.

The second track; Organizing for Execution represents a combination of new and classic issues around governance, decision making and learning. It covers issues with a wide perspective and long-ranging consequences for the organisations involved. Key issues are governance mechanisms, strategy implementation, decision making, relations and learning. Several papers discuss aspects of governance and how organisations may implement processes and structures in order to improve their value creation and value for money in investments. Examples presented here are the governments in the Netherlands and Norway, as well as several anonymous companies associated with the construction industry. This has a lot to do with designing purposeful decision making processes and using the right criteria for prioritizing and choice of projects. Other perspectives are how to implement necessary transformations of the organization in a changing environment. This is an important issue in a world of increasing globalization, competition and new technologies.

One major topic in several papers is the clarity and better understanding of roles and responsibilities in project organisations and between the project and its mother organization, as well as other stakeholders. These relational issues include communication, motivation, emotions and trust, just to mention some important aspects. The most fundamental topic in these papers is perhaps learning. Learning from cases and accumulating experiences in organisations in construction has been argued a particularly challenging thing to do. Several papers look into these challenges.

The types of organisations represented in these papers range from large public agencies, via industrial companies down to facilities management companies. The projects range accordingly from large infrastructure investments via large building design and development processes down to small and medium sized renovation and upgrading projects in existing buildings. All in all, this track comprises discussions on some of the major issues engaging the research community on construction projects in recent years. The picture is clearly Nordic in the sense that most of the cases reported are documented in the Nordic region, but extended to include Poland, France and the UK.

The third track; Efficiency in construction is the original core area of construction economics and organisation, internationally perhaps better known as construction management. It covers both qualitative and quantitative aspects of efficiency in construction. The majority of the papers address the human aspect in construction, but in different ways. Innovation, learning, daily life, scheduling, BIM, productivity, quality, procurement, contracts and supply chains are addressed, among other issues. Roles and interfaces between different stakeholders in a construction project are addressed in several papers.

Innovation is a key topic. It is addressed both explicitly in some papers, and implicitly in many more papers. Innovation in the construction sector is an important topic. It is mainly


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illustrated through cases. The construction sector is characterised by cooperation between many stakeholders. Design, planning and execution are typically carried out by project-oriented organizations. Deliveries of building components and materials are carried out by manufacturing companies. Interestingly, we also have comparisons between the construction sector and other sectors, as well as the use of analytical models used in other industries but here applied in a construction context.

Contracts and supply chain are addressed in several papers. The contractual relationships in the construction industry are illustrated, with special focus on incentives and stakeholder relations. Planning is addressed in a quantitative way, but from different perspectives. We also have a terminology overview related to planning.

The track includes examples of technology advancement in the construction industry, including Building Information Modelling (BIM).The track includes BIM approaches in a life cycle perspective.

Cases and data come from a wide array of countries, and are not limited to the Nordic region.

The research approaches represent an interesting mix of theoretical work in the form of literature reviews and conceptual papers, development of decision models and understanding of observed performance in real situations, as well as documenting learning from cases and demonstration projects. The empirical side is not surprisingly dominated by document studies and interviews. Several papers are based on case studies. Some papers have a more theoretical approach, while others are very empirical and data driven. In total these proceedings represent a good cross section of contemporary research in the field of construction economics and organization in 2013.


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TABLE OF CONTENTS

Track 1: Sustainable Development of the Urban Environment

The Sustainability Perspective

“GREEN OR MATURING?" ENVIRONMENTAL SUSTAINABILITY IN MARKETING AND BUSINESS DEVELOPMENT AMONGST CONSTRUCTION MAJORS

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Hedly Smyth

INCENTIVES TO CATALYSE GREEN BUILDING CERTIFICATIONS FOR BUILDING CONSTRUCTION 13Radhlinah Aulin, Filip Elland

ESTABLISHING A STAKEHOLDER FRAMWORK FOR ECO‐CITY DEVELOPMENT ‐WITH A CASE STUDY OF CHINESE ECO‐CITY

24

Yao Yao, Hans Lind, Tina Karrbom Gustavsson

THE FIRST GREAT METROPOLITAN PARK OF THE 21ST CENTURY: A MANIFESTATION OF GREEN URBANIZATION

36

Eric R. P. Farr, Poorang Piroozfar

THE ROLE OF SHOPPING CENTRES IN THE SUSTAINABLE TRANSITION OF NEIGHBOURHOODS 48Matthias Haase, Ruth Woods

GREEN PLANNING CHALLENGES AND OPPORTUNITIES ‐ A SYSTEM DYNAMICS PERSPECTIVE 59Peter Heffron

Sustainable Design

SUSTAINABILITY EVALUATION OF RETROFITTING AND RENOVATION OF BUILDINGS IN EARLY STAGES

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Per Anker Jensen, Esmir Maslesa, Navid Gohardani, Folke Björk, Stratis Kanarachos, Paris A. Fokaides

SUSTAINABLE TRANSFORMATION OF EXISTING BUILDINGS – A CASE STUDY OF A TRANSFORMATION OF A BARN AT CAMPHILL ROTVOLL

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Alise Plavina, Matthias Haase

PARTNERING FOR THE DEVELOPMENT OF AN ENERGY‐POSITIVE BUILDING. CASE STUDY OF POWERHOUSE #1

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Torill Meistad

LCA OF NANO‐COATED WOODEN CLADDINGS UTILIZING ACCELERATED AGEING TEST RESULTS

102

Selamawit M. Fufa, Bjørn Petter Jelle, Rolf André Bohne, Carine Grossrieder


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THE ROLE OF ACCELERATED CLIMATE AGEING OF BUILDING MATERIALS, COMPONENTS AND STRUCTURES IN THE LABORATORY

111

Bjørn Petter Jelle

Sustainability and People

ON THE DIFFERENCE BETWEEN PROJECT MANAGEMENT SUCCESS AND PROJECT SUCCESS 123Hallgrim Hjelmbrekke, Ola Lædre, Jardar Lohne

SUSTAINABLE LOW COST HOUSING FOR THE SOCIALLY DISADVANTAGED: THE VASSNESET EXAMPLE

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Ruth Woods, Kari Hovin Kjølle, Lars Gullbrekken

RESPONSIBILITY FOR ADHERING TO SUSTAINABILITY IN PROJECT MANAGEMENT 145Debby Goedknegt

WORKPRACTICE – IMPACT ON USERS’ ASSESSMENT OF USABILITY 155Siri Hunnes Blakstad, Kari Hovin Kjølle

Track 2: Organizing for Execution

Governance and Strategy Implementation

PARTNERSHIPS IN COMPLEX PROJECTS: AGENCY, INNOVATION AND GOVERNANCE 166Kim Haugbølle, Frédéric Bougrain, Marianne Forman, Stefan Christoffer Gottlieb

THE NORWEGIAN PROJECT GOVERNANCE SYSTEM: WEAKNESSES AND IMPROVEMENTS 178Asmamaw Tadege Shiferaw

MANAGING PUBLIC INFRASTRUCTURE NETWORKS. ON THE HORNS OF SEVERAL DILEMMAS 191Wim Leendertse, Jos Arts

THE DUTCH PROJECT GOVERNANCE SYSTEM: WEAKNESSES AND IMPROVEMENTS 203Asmamaw Tadege Shiferaw

ENHANCING CUSTOMER ORIENTATION IN CONSTRUCTION INDUSTRY BY MEANS OF NEW 215Päivi Jäväjä, Sunil Suwal, Janne Porkka, Nusrat Jung

EXPERIMENTAL DESIGN STRATEGY AS PART OF AN INNOVATIVE CONSTRUCTION INDUSTRY 227G. Maarten Gjaltema, Rogier P. P. Laterveer, Ruben Vrijhoef

IMPLICATIONS OF STRATEGY IN INDUSTRIALIZED HOUSE‐BUILDING – A LONGITUDINAL CASE STUDY

239

Louise Bildsten


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IMPLEMENTATION OF STRATEGIES: A CASE STUDY OF A MUNICIPALITY OWNED HOUSING COMPANY

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Tobias Alfljung, Ebba Birging, Sigrid Gunnemark, Sara Lindskog, Lorenz Mc Namara, Göran Lindahl, Pernilla Gluch

BOARD OF DIRECTORS’ RESPONSIBILITY FOR CONSTRUCTION PROJECTS 257

Ole Jonny Klakegg, David Shannon

Decision Making and Relationships

THE NEW COMMON GROUND: UNDERSTANDING VALUE 269Hallgrim Hjelmbrekke, Ole Jonny Klakegg

FACILITIES MANAGEMENT AND CONSTRUCTION CONVERGE IN A RENOVATION PROJECT 282Terttu Vainio, Veli Möttönen, Timo Kauppinen, Anne Tolman

US OR THEM? A CASE STUDY OF TWO INTERNAL PROJECT TEAMS DURING CONSTRUCTION OF A NEW CORPORATE HQ

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Siri Hunnes Blakstad, Nils O.E. Olsson

USE OF COLLABORATIVE WORKING IN CONSTRUCTION PROJECTS WITH HIGH ENERGY AMBITIONS

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Torill Meistad, Marit Støre Valen, Jardar Lohne

THE INTERPLAY OF EMOTIONAL INTELLIGENCE AND TRUST IN PROJECT RELATIONSHIPS 314Nicholas Boot‐Handford, Hedley Smyth

MANAGING STAKEHOLDER RELATIONSHIPS IN PPP PROJECTS 324J. Siering, A. Svensson, G. Lindahl

Learning from Projects

EXPLOITATION OF EXPLORATORY KNOWLEDGE: A MULTIPLE CASE STUDY OF KNOWLEDGE DIFFUSION FROM DEMONSTRATION PROJECTS

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Anders Vennström, Per Erik Eriksson

WHAT HAVE WE LEARNED ABOUT THE SOCIAL ASPECT IN LEARNING IN THE CONTEXT OF CONSTRUCTION PROJECTS BY NOW? – A REVIEW OF THE EARLIER STUDIES

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Anne Kokkonen

LEARNING IN THE EARLY DESIGN PHASE OF AN INFRASTRUCTURE DEVELOPMENT PROJECT 357Therese Eriksson

INFORMAL, INCIDENTAL NATURE OF KNOWLEDGE SHARING IN CONSTRUCTION PROJECTS 368Anandasivakumar Ekambaram, Hans Petter Krane


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Track 3: Efficiency in Construction

The human aspect in construction

EMPLOYEE ENGAGEMENT IN INNOVATION FOR THE BUILT ENVIRONMENT 379 Natalya Sergeeva

USING COMMUNITIES OF PRACTICE TO INTEGRATE INDUSTRIAL KNOWLEDGE INTO COOPERATIVE RESEARCH ON SUSTAINABILITY IN STEEL CONSTRUCTION

390

Gregor Nuesse, M. Limbachiya, R. Herr

THE DAILY LIFE OF A CONSTRUCTION CONTRACTOR – MULTIPLICITY IN PRODUCTION STRATEGIES

404

Helena Johnsson

BOUNDARY SPANNING IN CONSTRUCTION PROJECTS: TOWARDS A MODEL FOR MANAGING EFFICIENT COLLABORATION

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Tina Karrbom Gustavsson

ASSESSING CONSTRUCTION END USER VALUES 427Anders Björnfot, Leif Erik Storm, Eskild Narum Bakken

OPEN INNOVATION IN PROJECT‐BASED INDUSTRIES: THE CASE OF AN OPEN INNOVATION PROJECT IN CONSTRUCTION

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Marianne Forman, Kim Haugbølle MANAGING EXPLORATION AND EXPLOITATION IN CONSTRUCTION PROJECTS 451

Per Erik Eriksson, Henrik Szentes

Productivity and quality

A HOLISTIC APPROACH TO ACQUISITION OF BUILDING INFORMATION FOR A MORE EFFICIENT COLLABORATION

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Pouriya Parsanezhad, Väino Tarandi

CHALLENGES IN ENGAGING THE CLIENT DURING THE CAPTURE, TRANSLATION, TRANSFORMATION AND DELIVERY (CTTD) OF CLIENT REQUIREMENTS (CR) WITHIN THEBUILDING INFORMATION MODELLING (BIM) ENVIRONMENT

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Fara Atiquah Shahrin, Eric Johansen

IMPROVING INTERORGANIZATIONAL DESIGN PRACTICES IN THE WOOD‐BASED BUILDING INDUSTRY

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Christoph Merschbrock, B. E. Munkvold

LOSS AND PRODUCTIVITY IN PERFORMANCE OF CONCRETE STRUCTURE: A CASE STUDY 490Alberto Casado Lordsleem Jr., Fábia Kamilly Andrade, Suenne Correia Pinho


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PROGRAM OF PERFORMANCE INDICATORS FOR CEMENT‐BASED TECHNOLOGY CONSTRUCTION

501

Alberto Casado Lordsleem Jr., Suenne Andressa Correia Pinho

QUALITY PROGRESS MODEL FOR BUILDING CONSTRUCTION 512 Jussi M. Savolainen, Kalle E. Kähkönen

Supply chains and planning

CHARACTERISTICS OF SUPPLY CHAIN MANAGEMENT IN SYSTEMS BUILDING AND IMPLICATIONS FOR SMALL BUSINESS

520

Jarkko Erikshammar

INCENTIVE BASED PROCUREMENT IN CONSTRUCTION PARTNERING 530Emilio Johansson, Robert Ågren, Stefan Olander

A WAY TO EMPIRICALLY DEFINE CONTRACTING FORMS IN CONSTRUCTION 539Johan Nyström

COORDINATED SUPPLY CHAIN PLANNING IN CONSTRUCTION 546Micael Thunberg, Fredrik Persson, Martin Rudberg

SINGULARITY FUNCTIONS FOR INTEGRATING TEMPORAL AND FINANCIAL CONSTRAINT MODEL OF CONSTRUCTION PROJECTS

557

Gunnar Lucko, Richard C. Thompson

TOWARDS A TAXONOMY OF PLANNING AND SCHEDULING METHODS IN THE CONTEXT OF CONSTRUCTION MANAGEMENT

570

Hammad Al Nasseri, Kristian Widén, Radhlinah Aulin ADDRESSING THE DUE‐DATE‐DELIVERY PROBLEM OF DESIGN IN CONSTRUCTION PROJECTS 582

Kai Haakon Kristensen, Bjørn Andersen, Olav Torp


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THE INTERPLAY OF EMOTIONAL INTELLIGENCE AND TRUST IN

PROJECT RELATIONSHIPS

Nicholas Boot-Handford, Hedley Smyth

University College London, The Bartlett Faculty of the Built Environment, School of Construction and Project Management.

e-mail: [email protected] e-mail: [email protected]

Web page: http://www.bartlett.ucl.ac.uk/cpm

Abstract. The role of “soft” management skills has received increased attention over the last two decades inconstruction projects. Trust in project relationships has been one element; derived from the management literature, project literature on governance and relational contracting, andrelationship management theory. Emotional intelligence has received less albeit increased attention in construction. This research presents an original contribution to knowledge by bringing emotional intelligence and trust together to examine the extent to which they are related and whether the interplay is mutually reinforcing. The research context is provided by delivering value for money on construction projects in the UK rail industry and the focus upon collaborative working in the industry advocated inthe McNulty Report, 2011. A case study examines the management of a multi-billion pound railway upgrade project involving the client and the main contractors responsible for delivery. The findings are based upon soliciting individual’s perceptions of the project relationships both in their respective organizations and the other organizational actors. The findings demonstrate a positive interplay between trust and emotional intelligence. The causal linkage shows degrees of mutual reinforcement, yet is affected by contextual and contingent factors. In the case examined trust was found to be much lower in the clientorganization and in their perception of their relationships with the main contractors. Emotional Intelligence was found to enhance a range of elements of trust, yet, the client overall exhibited high levels of emotional intelligence but lower levels of trust.

KEYWORDS: Emotional Intelligence, Project Relationships, Public Sector, Relationship Management, Trust INTRODUCTION

The role of “soft” management skills has received increased research attention over the last two decades for project management and projects at enterprise and institutional levels (Morris, 2013). Trust, soundly based upon realistic assessments of actors and organizations, has been recognized as an important factor in the effective functioning of institutions (e.g. Kramer, 2009 in management; Smyth, 2008 for project environments). A trustworthiness model has been addressed in management (e.g. Mayer et al, 1995) and for projects (e.g. Kadefors, 2004). Trust has been examined in construction (e.g. Smyth and Edkins, 2007; Eriksson and Pesämma, 2007). Emotional intelligence (EI) has similarly received increased attention in management (e.g. Goleman, 1998) and for projects (e.g. Druskat and Druskat, 2006; Hobbs and Smyth, 2012). Despite conceptual associations, for example in the Goleman-Boyatzis model (e.g. Boyatzis et al, 2000; Druskat and Druskat, 2006), EI and trust have yet to be rigorously examined empirically together. The paper addresses this research gap.

EI and trust are articulated through relationships, their interplay affecting life experience, including operational efficiency and effectiveness. Strohmeier (1992) found that 88% of project managers spend more than half their time cooperating with other people, that is 19% higher than traditional managers. The mere existence of relationships with high interaction levels is not necessarily significant; yet value is added through relationship and many of the other management tools and techniques are only as useful as the hands they are in (Pryke and Smyth, 2006); thus, harnessing collaborative

NicholasBoot‐HandfordandHedleySmyth

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relationships has the ability to add value, particularly in terms of managing projects. Collaborative relationships have been shown to improve performance yet a lack of understanding of the importance and dynamics of relational components of these relationships pervades as organizations rarely focus on what contributes to the collaboration of people and teams, (Hattori and Lapidu, 2004). EI and trust are components and are claimed to improve performance (e.g. Druskat and Druskat, 2006; Eriksson and Pesämma, 2007). The interplay of EI and trust is explored for their direct contribution to relationship management and collaboration.

The literature on collaborative relationships and performance, EI and trust are reviewed. Following a methodology and methods section, the empirical research focuses upon large-scale complex rail infrastructure client-contractor relationships. A summary of the findings and recommendations both for research and practice conclude the paper.

2 LITERATURE REVIEW

Over the last two decades there has been a growing literature upon relationships in the form of relational contracting and relationship management. Partnering has formed an important component. It has ebbed in favour of cost drivers (Porter, 1985) in many commercial markets, yet for the growing infrastructure market collaborative practices are still strongly advocated (e.g. McNulty, 2011).

2.1 Relationships, collaboration and performance

Anvuur and Kumaswamy (2008) define collaborative relationships in line with Hamel et al (1989), involving short-term alliances between clients, designers, suppliers and facilities managers to deliver integrated services across organizational boundaries. Defining project performance is problematic as it is dependent upon the perspectives of decision-makers (Morris and Hough, 1987). Time-cost-quality/scope as project operational performance provides a traditional view. Functional value delivered, and/or benefits in use for client or end-user operations are other options. A traditional focus is adopted and supplemented by collaborative service content.

2.2 Emotional intelligence

The roots of EI are found in social intelligence. EI was first defined as: the ability to monitor one's own and others' feelings and emotions, to discriminate among them, and to use this information to guide one's thinking and actions (Salovey and Mayer, 1990: 189). Teamwork and collaboration are an EI competency, defined as working with others towards a shared goal and creating group synergy in pursuing collective goals (Boyatzis et al, 2000; Goleman et al, 2002; Druskat and Druskat, 2006). There are two categories of thought concerning EI. The first is suggests EI is simply anything that is not cognition, yet some argue this leaves EI “bereft of conceptual meaning” (Zeidner et al, 2004: 373). The second is analytical, treating EI as an information processing function. This category can be subdivided. One position is that EI is acquired and learnt through life experiences, such as the mental ability model (Salovey and Mayer, 1990), which places emphasis upon cognitive skills for managing emotions: i) perceiving emotions, ii) using emotions to facilitate thought, iii) understanding emotions, and iv) managing emotions in a way that enhances personal growth and social relations (Mayer et al, 1995). A second model in this position comes from Bar-On (1997), which focuses upon combined emotional and cognitive intelligence for individuals. The Goleman-Boyatzis model (Boyatzis et al, 2000) is a mixed model, placing a greater emphasis upon personality: i) self-awareness, ii) self-management, iii) social awareness, and iv) social skills/relationship management, which evolved into a personal and social competency model. The summary strengths and weaknesses of each model in this position are summarized in Table 1.The other position is that EI is a fixed trait (e.g. Petrides and Furnham, 2001). Sfeir’s (2012) trait analysis of project consultants found that non-trait factors were of operational significance. The EI trait model is also restricted to individual assessments. Thus, for operational and team working, ability and competency are more appropriate than trait conceptions. The Goleman-Boyatzis model is adopted for this study for several reasons. Group EI has been developed (Elfinbein, 2006) and applied in project teams (Druskat and Druskat, 2006). Although the link between EI and performance is contested (e.g. Davies et al, 1998; Matthews et al, 2002; Zeidner


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et al, 2004; Landy, 2005), this model is the most performance orientated, encompassing abilities beyond the specific processing of emotions (Morrison, 2007).

Table 1 : Strengths and Weaknesses of EI Models

EI Model Strength Weaknesses Salovey-Mayer Model

Empirically proven (unlike other models) not to represent conventional personality traits. Seen as more representative of a cognitive intelligence than other models. Its measurement is objective.

Criticized for as not constituting being a cognitive intelligence but a ‘learned skill’. Poor predictive validity of workforce performance. Ambiguity over what constitutes a correct (emotionally intelligent) response during objective measures. Confirmed lack of cultural variation sensitivity. Empirically confirmed measurement gender bias. Weak correlation with the other two EI models.

Bar-On Model EI develops with age and can be developed via training and therapy. Emotional and cognitive intelligence contribute equally to a person’s general intelligence, thus indicating an individual’s chances of succeeding in life.

Criticism that model has little to do with emotion or intelligence. Measures overlap with existing personality traits. Limitations of self-report measurement.

Goleman-Boyatzis Model

Assertion that EI competencies can enhance human performance (especially in at work context). Plentiful studies verifying the predictive validity of EI and work performance. Advocated as more important than IQ in determining life success. EI competencies can be learnt at any age. Proficiency in all 18 competencies is not needed.

Criticised for being existing personality characteristics. Criticised for not constituting a cognitive intelligence. Criticism model does not constitute EI concept. Limitations of self-report measurement. Criticism that performance enhancing benefits are anecdotal and lack empirical research.

Source: adapted from Hobbs and Smyth, 2012

2.3 Trust

Dirks (1999: 445) claims trust is a hallmark of an effective relationship. Trust is considered an important component of effective and valuable relationships in project environments (Kadefors, 2004; Lau and Rowlinson, 2009). Trust has been shown to enhance performance (e.g. Smyth et al, 2010). Mayer et al (1995: 712) define trust as the willingness of a party to be vulnerable to the actions of another party based on the expectation that the other will perform a particular action important to the trustor, irrespective of the ability to monitor or control that other party. Mayer et al are frequently cited, although the model tests trustworthiness rather than trust according to their definition. Definitions and conceptions are contested, Smyth, (2006: 99) stating, definitions of trust accord with the bundle of relationship experiences encountered, recognizing that every relationship is different in character. Thus, a broader scoping definition has been proposed: Trust is a current conviction that another party is willing to take individual and organisational interests into account within the context and under possible events. Trust is intuitively, sometimes part-cognitively, assessed concerning the other party from recent past performance and longer term reputation through the lens of personal


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history hence experiential disposition to trust, coupled with organisational capability (cultural, systemic and procedural path dependency) to accommodate trusting relations. The presence of a trusted party (i) reduces perceived (interpreted or ‘subjective’) risk, (ii) renders the relationship, organisational and project context more conducive to further (real or ‘objective’) risk reduction, and (iii) creates organisational and project opportunities to improve the service and content quality (Smyth et al, 2010: 12-13), where “conviction” refers to a sense of who the other party is, or parties are, as human beings (rather than human doings, that is, the essence of others and not their performance) plus the sense of what the organisation is about (especially the perception of their reputation). This provides an initial assessment, which is typically intuitive with some cognition. This is informed and moderated by the extent of the predisposition to trust which is typically assessed by habit and intuition about context. These two elements of assessment lead to the current conviction. Continuous contact provides behavioural evidence of both the individual parties and the organisation. It leads to iterative re-assessment that remains largely intuitive but has increasing cognitively assessed evidence (Smyth, 2010: 25). Therefore trust is not performance-based per se, but helps improve performance.

Therefore an established framework of trust (rather than trustworthiness) has been applied in project environments, comprising seven elements: characteristics of trust (Lyons and Mehta, 1997), components for trust (Smyth and Edkins, 2007), social obligations of trust (Sako, 1992; Smyth, 2008), conditions of trust (Butler, 1991; Smyth and Thompson, 2005), levels of trust (Smyth and Pilcher, 2008), operational basis for trust (Smyth and Pilcher, 2008) and trust in the marketplace expressed as power and dependency relations (Campbell, 1995; Smyth, 2005; 2008). 3 METHODOLOGY AND METHODS

The methodology is quantitative, which is suited to abductively scoping linkage between trust and EI in collaborative relationships, yet needs to be considered as part of a programme of research. The methodology presumes further detailed work on the generative mechanisms between essential and contingent causal processes (Sayer, 1992; Danermark et al, 2002), involving qualitative outputs to account for ontological and contextual factors. Additionally, data from a single case study is not necessarily representative of general domain due to the population, response rates, context as well as the need for further scoping work. Quantitative, especially statistical findings generated using positivist methodologies tend to be used to claim more than is justifiable (Smyth and Morris, 2007), thus a programme requires additional qualitative research around “how” and “why” questions.

Thus a scoping examination of the interplay between EI and trust is conducted. EI and Trust on large-scale complex UK rail infrastructure projects and associated client-contractor relationships within a programme of work provides the empirical focus. The client project coalition comprised 600 people delivering an upgrade rail programme valued at £3.4 billion (excluding the new signaling) to improve train frequency, journey times and ambience with a new automatic train control system and a rolling stock fleet. The actors taking part in the study were client personnel with regular inter-personal contact with contractor personnel in regular interpersonal contact with client actors.

An online survey was conducted to assess the levels of trust between parties and the individual levels of EI. The first part asked individuals to comment on their relationships with others in their organization and delivery partner. Five of the seven trust framework elements were asked about, namely, characteristics, components, social obligations, conditions of trust and trust in the marketplace. The second part required the participants to respond via a Likert scale as to whether they agreed with different statements related to Goleman-Boyatzis competencies. 41 participants completed the survey (c. 7% response rate), although not all 600 people were currently engaged with the programme and so the effective response rate was probably higher. Respondents from the client side numbered 30 and 11 came from contractors, constraining the viability of the contractor data. The applied trust framework is analysed from three angles: the client-contractor interface for trust, EI levels amongst contractor and client respondents, and comparing EI group levels in relation to trust.


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4 FINDINGS AND ANALYSIS

Concerning trust at the client-contractor interface, respondents were asked to score their relationships with their external organizational counterparts, consisting of project managers, quantity surveyors/cost managers and commercial managers. The result for trust is shown in Table 2.

Table 2 :Trust Ratings for the Five Framework Elements

Overall the percentage scores presented in Table 2 are high, although there are some low points, in particular the low score for the perceived ratings given by the contractor towards their ability to trust the client (27%), whereas the client expected a higher rating (59%) indicating a misplaced perception of their own actions and behavior towards the contractor. Trust in the market is scored moderately low by all parties (a range of 40-60%). This might infer the exercise of market power can be corrosive, especially where decision-makers do not organizationally behave to reflect the greater responsibility that comes with power. It may also reflect the temptation to act with opportunism, sometimes with guile at a detailed level. The characteristics of trust are noted above as low concerning the contractor ratings of the client. This is reinforced when the characteristics are broken down into (i) self-interested and socially orientated trust, and (ii) include negative factors of high or excessive levels of accountability that indicate a lack of trust and considerable opportunism (see Table 3). The contractor marginally under-estimated their performance regarding trust compared to the views held by the client. This may reflect are certain sense of lacking power and undervaluing organizational behavioral capabilities by the contractor. It also shows that the client is often a prime mover in constraining trust development and eroding trust over project lifecycles (see also Smyth and Edkins, 2007; Ayres and Smyth, 2010; Schofield and Smyth, 2012).

Trust Framework Element

Element Item

Contractor Ratings of

Client Percentage of

contractor respondents

(Score)

Client Ratings of Contractor

Percentage of client

respondents (Score)

Contractor Estimate of

Client Assessment

Client Estimate of Contractor Assessment

Characteristics of Trust

Total 27% 73% 64% 59%

Components of Trust

Faith 88% 70% 88% 62% Hope 91% 70% 82% 64% Confidence 91% 63% 88% 61%

Social Obligations of Trust

Dignity 80% 75% 89% 79% Respect 80% 72% 91% 79%

Conditions of Trust

Integrity 94% 83% 94% 69% Receptivity 82% 72% 85% 60% Loyalty 94% 80% 82% 61% Discretion 85% 76% 85% 70% Openness 82% 71% 85% 60% Consistency 91% 75% 85% 62% Promise-fulfilment

73% 69% 88% 61%

Fairness 85% 76% 91% 67% Competence 91% 81% 91% 67% Availability 88% 74% 88% 71%

Trust in the Market

Arms Length 46% 40% - - Obligatory 54% 60% - -


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Table 3 : A Breakdown of the Characteristics of Trust

The contractor shows a high level of trust towards the client, a social orientation, which may be a function of willingness to serve the client by “going the extra mile”, but may also be a function of dependence in the market. This latter position appears to be the case due to the high client propensity for opportunistic behaviour (Table 3). These detailed findings explain the low percentage scores found in Table 2. Client organizational behaviour is misaligned with the recommendations to industry (McNulty, 2011). Organizational behavior, aggregated through habits and norms, takes time to change; yet, there is a considerable ground to be made up on the assumption that the client’s intention is to do so and the recommendations are appropriate.

The findings for EI are first set out in Table 4, which shows a range of scores. The highest net score is 69 (Question 1) where there is widespread agreement that feeling content improves levels of individual performance at work. The lowest is -5 for Question 4. It shows people exhibit stress and anger in the workplace. Following the Goleman-Boyatzis model, this demonstrates a lack of self-management, constraining effective relationship management. The next lowest net score is 24 (Question 13), indicating the project environment may be predominantly task-focused, and possibly inward looking. There was, however, indication of a strong customer focus (Question 12), teamwork supported by EI (Questions 2 and 14), agreement that people want to do the best they can (Question 8) and contentment with work increases performance (Question 1). The findings for EI are first set out in Table 4. A range of scores is presented.

The EI scores provide a baseline to compare against trust and for exploring the interplay. Two types of analysis were conducted. First is the analysis of EI against the trust elements (Table 5). Overall, EI complements trust and thus together help to establish and build relationships at the client-contractor interface. The client is stronger at establishing a trusting relationship, but weaker maintaining and developing the relationship in terms of harnessing the use of EI. This is particularly evident in the scores for the components and conditions of trust.

Characteristics of Trust (Likert scale: +2-2)

Contractor Net Scores

Client Net Scores

Socially orientated trust (going the extra mile) (+2)

20 16

Self-interested trust (classic win-win) (+1)

12 26

Indifference (neutral) (0) 0 0

Accountability orientation (we don’t trust you) (-1)

-9 -21

Opportunism (at the expense of others) (-2)

-2 -46

Total Scores 21 4


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Table 4 : The Schedule of Emotional Intelligence Scores

EI Question

Dis

agre

eme

ntS

core

s

Neu

tral

ity

Inci

denc

es

Agr

eem

entS

core

s

Net

Sco

re

Agr

eem

ent

Per

cent

ages

1. When I feel content, it has a positive effect on my performance at work

0 3 69 69

94

2. When I know I am not working to my strengths I ask others who are strong in the area to give me assistance

0 5 52 52 89

3. I am content with who I am -3 3 55 52 87

4. When I am stressed or even angry it does not show in meetings and with how I behave at work

-21 15 16 -5 28

5. I often tell people how I feel and my opinions -7 11 36 29 64

6. I like to see the good in things and have an optimistic approach to life

-2 7 51 49 83

7. I find it easy to adapt when things change like goals or priorities

-3 6 50 47 83

8. I want to be the best I can be and always look to improve

0 3 66 66 94

9. I do not need strict guidance in order to get on with tasks

-1 4 60 59 89

10. When I see someone discontent, unhappy or upset I like to find out why and see if I can help

-1 8 55 54 81

11. I like to know the full story and background to problems and issues at work

-2 5 46 44 85

12. I look out for the customer in the solutions I implement not just the easiest outcome

-2 3 56 54 91

13. I often suggest areas that others could develop in

-7 13 31 24 57

14. I am enthusiastic about what I ask others to do for me

0 4 52 52 91

15. I can often persuade others to come round to my way of thinking

-1 6 45 44 85

16. I am more than happy with change and actively pursue changing things when there are better ways of doing something

-5 5 49 44 81

17. I am able to not get into arguments and when I do we both go away in agreement

-4 16 32 28 57

18. I enjoy working with others in a team rather than on my own

0 10 52 52 78


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Table 5 : The Relationship of Emotional Intelligence in Relation to the Trust

Average

ContractorClient Relationship ClientContractor Relationship

Contractor Ratings of Client

Relationship to Average EI

Score

Client Ratings of Contractor

Relationship to Average EI

Score

Characteristics of Trust

27 0.56 33 0.68

Components of Trust

90 1.86 68 1.40

Social Obligations of

Trust

80 1.65 74 1.52

Conditions of Trust

87 1.78 77 1.58

Trust in the Market

50 1.03 50 1.03

However, effective relationship management depends upon mobilizing trust and EI against the

categories in the Goleman-Boyatzis model. The average trust score is related to the average scores for the 18 EI questions, the results being allocated according to the four categories in the model. The resultant scores are (i) self-awareness, 0.93; (ii) self-management, 0.68; (iii) social awareness, 0.73; (iv) social skills/relationship management, 0.74. The highest score is for self-awareness, although awareness can be used for good or bad, that is, to build a social orientation or pursue opportunism with guile at either extreme. Trust therefore appears to be helping to establish relationships with EI self-awareness, but the lower scores of social awareness and management suggest that EI is not being mobilised in project team collaboration and performance to full effect. Interestingly, the lowest score is for self-management. This may be the issue blocking the translation. Other research has confirmed a degree of maverick behaviour whereby many project managers tend to follow practices that accord with personal comfort zones rather than serving employer and client interests (Wells and Smyth, 2011). Whether this is the reason, there is a lack of effective group EI, which management could address.

This research has brought trust and EI together, the practical implication being that trust provides a means for EI development and the application of EI serves facilitate trust development in a mutually reinforcing way that evolves iteratively over project lifecycles for effective project execution. 5 CONCLUSIONS AND RECOMMENDATIONS

The research brought trust and EI together as an original contribution to research. The interplay found that the trust scores were quite high compared to other findings, although low for effective collaboration. In general there was evidence of a positive interplay between trust and EI. Yet, the ability to develop trust towards an enhanced social orientation to facilitate collaboration was partial and weakest on the client side, thus not meeting the objectives of the industry in which the case study is situated. EI scores were reasonable. Examining the interplay between trust and EI show some interesting findings:

The client is stronger at establishing a trusting relationship, but weaker maintaining and developing the relationship in terms of harnessing the use of EI – temporal contracts mean contractors have to quickly make an impact whilst the client arguably can more easily take a longer term view about building relationships;

The contractor has a greater social orientation than the client; Self-awareness is not being used to improve self-management; Self-awareness is not being translated into social awareness and social management.


322

Therefore, too often the focus is upon on the mechanics of delivery without a sufficient thought for and management of the people delivering projects.

The main limitation of the research is the single in-depth case study taken as a snapshot, and therefore this restricts the ability to generalise. The research may have more general application and thus managers and project managers may need to be cognizant of the following:

1. The need to manage projects team using relationship management principles and routines to build trust and build upon self awareness amongst team members;

2. More rigorously control the application of project management systems, tools and techniques according to corporate policies and project management strategies;

3. Enhance capability development of soft management skills for effective project management.

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CONSTRUCTION ECONOMICS AND ORGANISATION · PDF file7th Nordic Conference on Construction Economics and Organisation Trondheim June 12-14, 2013 Editorial Board Ole Jonny Klakegg, Norwegian