QS010 - AN ASSESMENT OF THE EFFECT OF MANAGEMENT SKILLS OF INDIGENOUS CONTRACTORS ON PRODUCTIVITY AND PROFIT

CHAPTER ONE

INTRODUCTION

1.0  Background to the study

The successful completion of any project depends on proper management. The overall planning, control and co-ordination of a project from inception to completion ensures value for the client’s money and also increase productivity and profit of a firm. Thus management as defined by Day (1994) is the process of securing a facility which fully satisfies a client’s requirements within the approved time and cost. Frank. II & Ronald M C (2001) defined management as coordinating and controlling and controlling all aspect of the project, overall planning, controlling and coordination of the design and constructing process from inception hand over.

Albert & Benjamin Ross (2008) defined management as the application of knowledge, skill, tools and techniques to project in order to meet project needs.

According to advance dictionary productivity is defined as the ratio of the quality and quantity of units produced to the labour per unit of time difficult measure at best is usually attributed to the improved efficiency of some specific resource capital, money, materials or technology.

In the past year the contractors output in relation to the available resources has been one of the major problems of the contractors. Productivity has been low blames were always shifted either to the supervisor or the labourers on the sites. But nobody has voluntarily accept the fact that low productivity and profit is due to inability to manage and direct the workers towards achieving a good result.                                                                                       The most important factors that improve productivity and profit depend on management; effective planning, more effective job procedures, better communications, more effective human resources policies, improved decision making etc.                                                                                                                                                                                         Experience has shown that through better contract management there is always room for improvement in the execution of project by construction firms, the overall time taken is often well in excess of what it could have been if appropriate managerial techniques designed for better productivity were carefully implemented to minimize lost man-hours.                                                                                                                                                                        In construction firms the purpose and function of management activity is to enable the building operation to be carried through smoothly, effectively and economically.                                        This management principles and techniques can be developed and improved efficient production so as not only to lower cost and raise profit, but also to make possible increase pay for workers through their higher productivity.

With this background, this study/project wants to look into the management principles and technique and how they can be used as tools to achieve maximize productivity and profit.                          

1.1        Statement of Problem                                                                                                                                                                                                                                   

Ineffective contract; management has brought about reduction in, productivity and profit in construction firm especially indigenous firms, many project are usually abandon due to poor planning, lack of effective co-ordination arid poor funding.

 1.2      Research Question

In-order to guide the study and achieve the above stated research objectives; the following research questions were formulated:

1.      What are the factors affecting low productivity in construction industries?

2.      What were the criteria being used for management process?

3.      What are the types of management skills tools used in construction industries?

4.      What are the resource as an essential element in profit planning?

1.3        Aim 

The aim of this study is to find out the impact of management skills of indigenous contractors on productivity and profit.

1.4         Objectives

1.      To identify the various management process and techniques that can be used by contracting firms

2.      To assess the amount of management skill is possessed and used by indigenous contractors

3.      To identify the effect of possession and the use of adequate management skills on the profit of a firm.

4.      To determine the effect of application of good management techniques on productivity of a firm.

1.5      Significance of the Study

Productivity and Profit are key resources on building projects. However to realize full economic from productivity and profit issue must be addressed in all contracting organization. Productivity and profit are one key component to every companies success and competitiveness in the market. Declining productivity and profit across nation causes abandon of project.

1.6        Scope of Study

·        The scope of this study is to examine the impact of effective contract management on construction firms and determine the overall result with respect to maximum productivity and profitability.

·        The research is limited to such activities on site, as regards the management capacity, labour, plant and materials.

·        Construction firms in Abeokuta south and Obafemi owode have been chosen as the case study because of the highly concentration of construction firm in these areas.