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Supply Chain Management and Construction Project Delivery: Constraints to its Application

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By Benedict Amade; Prof Edem Okon Peter Akpan, PhD; Emmanuel Chinenye Ubani, PhD; and Uzoma Francis Amaeshi, PhD

Department of Project Management Technology
Federal University of Technology

Owerri, Nigeria

 


ABSTRACT

Supply chain management (SCM) is a production based project delivery approach that has come to stay and help streamline all the experiences of extensive delays and abandonment that have bedeviled the Nigerian construction industry. The objectives of this study were to identify and evaluate the constraints to the application of SCM in the delivery of construction projects. The study adopted an exploratory research design method of investigation consisting of both quantitative and qualitative methods. A purposive and convenient sampling technique was deployed in selecting the sample size using the Krejcie and Morgan method. A semi-structured interview, multiple case study, personal observation and questionnaire survey was carried out among four (4) construction firms located in Abuja, Lagos and Rivers State respectively. The questionnaires were used as the primary data collection instrument after they were pre-tested using a pilot study for validity and reliability. The data collected were analyzed using Severity Index (SI) and Cronbach’s Alpha reliability with the aid of SPSS 17.0 version as well as a Microsoft excels programmed software.

The study found that out of the 403 responses gotten on the twenty four (24) factors identified as constraints to the application of SCM in construction project delivery. The followings were identified as the most significant constraints; Lack of the understanding of SCM concept (SI=50.76), unclear strategic benefits (SI=50.52), dearth of trust within and outside an organization (SI=50.31), lack of a common standard for collaboration (SI=49.32) and failure to broaden the SC vision beyond procurement or product distribution (SI=48.12). The study recommends that a forum be created through workshops, conferences, face-to-face interactions to aid in understanding what the concept is all about. The study further recommends that effort should be made by the professionals, contractors, subcontractors and the likes to adopt the SCM techniques in the delivery of their construction projects to schedule, cost and quality objectives.

Keywords: supply chain management, construction supply chain management, construction projects, severity index, Nigerian, case study

Introduction

Organizations are getting aware of the need to identify, understand and manage their supply chains within their organization as well as co-operate with other sister organizations in a bid to successfully manage all issues within their supply chain (Charter, Kielkiewicz-Young, Young, & Hughes, 2001). Supply chain according to Tiwari, Sheperd, and Pandey (2014) is defined as a network of organizations or entities that are tied through an upstream and downstream linkage via the different processes and activities with a view to producing valuable products or services for their end users. The supply chain within the context of a construction project as opined by (Ahmed, Azhar, & Ahmad, 2002) can be said to be a scenario where the client comes first, this is closely followed by the designer, contractor, specialist contractors/subcontractors/suppliers thus forming a cluster of supply chains. Certain demands can be seen to flow down the chain in the form of information such as project briefs, drawings, schedules, work orders with goods and materials flowing in the opposite direction. Xue, Wang, Shen, and Li (2007) opined that construction supply chain is not a chain of construction businesses with business to business relationships, but rather a network of multiple organizations and relationships comprising the flow of information, material, services or products as well as flow of funds between the client, designers and suppliers.

The key goal of SCM is to bring down inventory to the barest minimum and regulate supplier’s interaction along the production line more effectively. (Cutting-Decelle, et al., 2007). The objective of SCM is to be able to get the right products in the right quantities, at the right moment with minimal cost. Furthermore, such objectives could be converted into a precise area of interest like flexibility, delivery, reliability, effective lead/delivery time and minimum inventory. Delivery reliability and delivery times according to Cutting-Decelle et al. (2007) are aspects of customer service which relies heavily on flexibility and inventory. As a result of the benefits derived from the application of SCM principles by the manufacturing and production sectors, few construction firms are beginning to see the need to adopt and inculcate SCM principles and ideas into their activities to help address problems associated with adversarial, inter-organizational purchaser-supplier relationships as evident in most construction project related activities. According to (Akintoye, McIntosh, & Fitzgerald, 2000; Saad, Jones, & James, 2002), SCM in the construction industry is still at its infancy stage and its importance to the construction industry and projects are unquantifiable. SCM can be adduced to be an epitome of evolutionary and cumulative innovation which is said to have emanated from the internal programmes of an organization by reducing waste and adding value with the sole aim of improving overall effectiveness of the entire supply chain (SC).

SC comprises of firms and organizations contributing to the delivery of a high-quality standard project or service to its client. Benton and McHenry (2010) opined that Japanese manufacturers had a tight grip over their SCs with the aid of keiretsu, which literarily means, a business partner that relies on cooperation, coordination and control to competitively position business and industry norms. Its application in the United States of America according to Benton and McHenry (2010) resulted to the concept of SCM. A lot of firms in the construction industry are keying into the lessons learned from the manufacturing industry. Most of them are now implementing six sigma, lean thinking and a lot of other initiatives to drive home their construction projects to fruition, but this is not the case with Nigeria specifically and other developing countries of the world in general.

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About the Authors

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Benedict Amade

Owerri, Nigeria

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Benedict Amade, a Project Manager by Profession, is studying for a Doctor of Philosophy (PhD) Degree in Project Management Technology at the Federal University of Technology, Owerri, Nigeria, and is a member of the Project Management Institute (PMI) U.S.A. Mr. Amade presently is a lecturer in Project Management at the Department of Project Management Technology of the above mentioned institution. His areas of research interest include construction project management, computer based project management and construction supply chain management. He has authored more than 15 scientific publications in international refereed journals and is actively involved in other consultancy works.  He can be contacted at [email protected] or [email protected]

 

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Prof Edem Okon Peter Akpan, PhD

Federal University of Technology
Owerri, Nigeria

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Edem Okon Peter Akpan
is a distinguished figure in the field of Project Management, Industrial Engineering and Information Technology. He is currently a Professor in the Department of Project Management Technology, Federal University of Technology, Owerri, Nigeria. He read and obtained a B.Sc in Management and Engineering Production from the University of Wales, Institute of Science and Technology, Cardiff and an M.Sc and a Ph.D in Aston, Birmingham and Bradford respectively. He has published widely both in the local and international journals and in recognition of this feat has since been honoured to join the editorial boards of International Journal of Production Planning and Control of Taylor and Francis London and the Journal of Construction Engineering and Management of the American Society of Civil Engineers (ASCE). He is a registered Engineer (COREN), consultant to many organizations and a member of several professional associations. Professor Akpan can be reached on [email protected]

 

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Emmanuel Chinenye Ubani, PhD

Federal University of Technology
Owerri, Nigeria

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Emmanuel Chinenye Ubani
is a Reader in the Department of Project Management Technology, Federal University of Technology, Owerri, Nigeria. He holds a B.Sc, M.Eng and Ph.D in Industrial Engineering and Project Management. His areas of research interest include; Construction and Engineering Project Management, Materials Requirement Planning. He is member of the Nigerian Society of Engineers (NSE) and Fellow of the Institute of Industrial Administration. Dr. Ubani can be reached on [email protected]

 

Uzoma Francis Amaeshi, PhD

Federal University of Technology
Owerri, Nigeria

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Uzoma Francis Amaeshi
is a Senior Lecturer in the Department of Project Management Technology, Federal University of Technology, Owerri, Nigeria. He holds a Ph.D in Management. His areas of research interest include; Management, Human Resources and Financial Accounting. Dr. Amaeshi can be reached on [email protected]