1

)

EXECUTIVE SUMMARY       

  

 

 

(FINAL REPORT)   

      

A Study by IBS Centre, Construction Industry Development Board Malaysia (CIDB) 

  

   

A SURVEY ON THE EFFECTIVENESS AND IMPACT 

OF INDUSTRIALISED BUILDING SYSTEM (IBS) 

TRAINING ON CONTRACTORS  

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EXECUTIVE SUMMARY From the perspective of Industrialised Building System (IBS), there is a general

consensus that contractors among the wide range of industry stakeholders

hold a very important position to ensure the success of IBS application.

Despite acknowledging its benefits, contractors are still not rapidly

embracing IBS. For contractors, the construction industry is an established

industry with many deep-seated and culturally-embedded practices, so the

introduction of anything perceived as new or different faces barriers. To deal

with this matter and to produce contractors which capable to undertake IBS

projects under SPP 7: 2008, the Construction Industry Development Board

(CIDB) has organise training for contractors to be vendor of specialist

contractors (installer) for IBS. Nonetheless the effectiveness and the impact

of this training have never been measured and the current state of

contractors is not known. The primary aim of this study is to determine the

effectiveness and impact of IBS training to contractors in the Malaysian

construction industry. The secondary aim is to identify the success factors for

contractor to implement IBS. The majority of respondents had undergone IBS

training courses but not all contractors have implemented IBS project after

completion of training. A challenge to be faced by the contractors is the

lack of suitable and sustainable opportunities in IBS. Most respondents

agreed that the position and financial strength is an important aspect

contributing to the success of contractors. Thus, measures deemed

appropriate by the CIDB in attracting contractors to enter the field of IBS is to

provide better incentives. Collaboration in the form of partnering is the best

way to develop a contractor in the field of IBS. In addition, knowledge of the

financial aspects should be emphasised to the contractor to enter the field

of IBS. At the end of the report recommendations and transformation

framework for contractors are presented.

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TABLE OF CONTENTS

No. Content Page

Executive Summary 2

Key Findings 6

1.0 Introduction 8

2.0 The Role of Contractor in IBS 9

3.0 Problem Statement 11

4.0 Training and Education 8

5.0 The Survey 13

6.0 Survey Data and Analysis 15

7.0 Conclusions 30

8.0 Recommendations 31

9.0 Transformation Framework for Contractor to Adopt IBS

32

10.0 Build offsite Accreditation Scheme 37

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LIST OF FIGURES

No. Figure Page

     

1 Respondent registration under CIDB 16

2 Respondent's professional background 17

3 Respondent's Working Experience 21

4 The percentage of contractors involved in IBS tender 19

5 Type of IBS Project 20

6 Type of system used in IBS project 21

7 Type of future training preferred by contractors 23

8 Contractors involved in the manufacturing component of IBS 26

9 Contractors have to be a specialist contractor in the IBS 27

10 Transformation Firework 33

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LIST OF TABLES

No. Table Page

1 Respondent registration under CIDB 15

2 Respondent professional background 16

3 Respondent’s Working Experience 17

4 Number of IBS Project Undertaken by the Company 19

5 Total Value of IBS Project 19

6 Type of project 20

7 Training Effectiveness of IBS Centre 21

8 Training Effectiveness of IBS Centre 22

9 Perspective of contractors on the implementation of IBS in government building

23

10 Challenges faced by Contractors in Carrying out IBS Projects 24

11 Factors that Contribute to the Success of IBS Contractor 25

12 Contractors Involved in the Manufacturing Component of IBS 26

13 Contractors have to be a Specialist Contractor in the IBS 27

14 Improving measures to be taken by the CIDB 28

15 Action to be taken by Contractor to Involve in IBS 29

16 Ranking of factors that are important to contractors in IBS 30

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KEY FINDINGS

• The primary aim of this study is to determine the effectiveness and

impact of IBS training to contractors in the Malaysian construction

industry. The secondary aim is to identify the success factors for

contractor to adopt IBS from current conventional practices

• More than half of the contractor is G1. G1 represent 55.9% of total

respondents, while the remaining 44.1% represent G2, G3, G4, G5

and G7. Most likely the survey represents the perspective of small

and medium sized contractors.

• Most of the respondents (87.9%) agree that IBS contractor’s training is

effective.

• 22.6% of the respondents who have completed the training involved

in IBS tender

• Only 9% of the respondent has been awarded contracts that

involved IBS elements. Most of them involved in IBS projects tendered

by the government. Most of the IBS projects conducted by these

contractors are school with 42.9% followed by Government Office

Building with 28.6% and the least type of project is hospital with 14.3%.

• About 86.2% of the respondents feel that the training conducted

by CIDB assisting respondent in carrying out projects of IBS.13.8% of

the respondent does not agree because of lack of practical training

and inadequate training period.

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• Majority of the respondent (30.3%) agree that roof truss installation is

the training that must be conducted by the CIDB in future for the

contractors.

• Most of the respondents with mean score 4.46 strongly agree that

knowledge about IBS is the main factor that contributes to the

success of IBS contractor.

• 82.9% of the respondent agrees that IBS implementation

of government projects under SPP 7: 2008 do give some benefit to

contractors such as financial gain, time reduction, quality and safety.

• As strategic measure, most of the respondents (88.6%) agree that

contractors should be involved in the manufacturing of IBS

components with some financial aid and incentives from

government.

• Despite the implementation of IBS in public project under SPP 7: 2008,

lack of suitable projects is the main challenge faced by the

contractors results the contractors is not keen to participate into IBS

project tender. Besides that, relying much on the manufacturer is also

the main challenge faced by the contractor in carrying out IBS

projects.

• Partnering and vendor system is the effective method to increase the

capability of contractor on IBS. Further, positioning and financial

strength is the most important aspect to the contractor in order to

implement the IBS project.

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1.0 Introduction to IBS

1.1 Industrialised Building System (IBS) is the term coined by the industry

and government in Malaysia to represent the adoption of

construction industrialisation and the use of prefabrication of

components in building construction. IBS is defined as a construction

technique in which components are manufactured in a controlled

environment (on or off site), transported, positioned and assembled

into a structure with minimal additional site work.

1.2 IBS consists of precast component systems, fabricated steel

structures, innovative mound systems, modular block systems and

prefabricated timber structures as construction components. Parts of

the building that are repetitive but difficult – and too time consuming

and labour intensive to be casted onsite – are designed and

detailed as standardised components at the factory and are then

brought to the site to be assembled. The onsite casting activities in

IBS utilise innovative and clean mound technologies.

1.3 The construction industry has started to embrace IBS as a method of

attaining better construction quality and productivity, reducing risks

related to occupational safety and health, alleviating issues for skilled

workers and dependency on manual foreign labour, and achieving

the ultimate goal of reducing the overall cost of construction. Apart

from this, it offers minimal wastage, fewer site materials, a cleaner

and neater environment, controlled quality, and lower total

construction costs.

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2.0 The Role of Contractor in IBS

2.1 Contractors are the stakeholders dealing with project management

and solving issues in construction on a day-to-day basis. They are

responsible for the means and methods to be used in the

construction execution of the project, in accordance with the

contract documents, and for the supplying of all materials, labour,

equipment (engineering vehicles and tools) and services necessary

for the construction of the project. In many cases, the main

contractors will delegate portions of the contract work to

subcontractors.

2.2 As in a common rule, contractors will provide direct labour for civil

aspects of a construction project, such as placement of concrete

and carpentry with specialty areas, such as mechanical and

electrical construction furnished by specialty subcontractors.

2.3 From the perspective of IBS, there is a general consensus that

contractors among the wide range of industry stakeholders hold a

very important position to ensure the success of IBS application.

2.4 Despite acknowledging its benefits, contractors are still not rapidly

embracing IBS. The construction industry is an established industry

with many deep-seated and culturally-embedded practices, so the

introduction of anything perceived as new or different faces barriers.

The barriers to adopting the IBS method in construction are:

2.4.1 IBS requires radical and substantial change from a

traditional building process towards a manufacturing

process. It was highlighted that the idealism, processes,

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management and skill sets behind IBS method are

different from those in the conventional method.

2.4.2 In contrast to the traditional method, the design,

manufacturer, assembly and other related processes

require a more coherent structure of process planning

and control in order to reduce defects and errors.

2.4.3 A strong constraint in the industry is a lack of adequate

knowledge of the IBS method. There is limited expertise in

the marketplace among designers and constructors

regarding the IBS method. Approaches to design are still

largely based on traditional methods that are unsuited to

IBS.

2.4.4 Although IBS is used to address the skill shortage in the

construction industry, some evidence suggests that a

skilled workforce in specific skill areas like integration,

coordination and assembly are becoming more

important to IBS due to different roles and project

methods that are undertaken.

2.4.5 IBS adoption requires a new business approach,

investment and financial planning including an effective

combination of cost control and selection of projects that

give enough volume to justify the investment.

2.4.6 IBS adoption requires an improvement in conventional

procurement and management of the supply chain. The

IBS building procurement is slightly different from

conventional methods which include purchasing of

materials in advance before the actual site progresses.

2.4.7 Therefore, effort towards total industry adoption to IBS

from conventional methods largely depends on readiness

and maturity of contractors which will coordinate

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processes involved in IBS life cycle. As a consequence,

perspective and the role played by the contractors in IBS

needs to be scrutinised.

3.0 Problem Statement

3.1 However, there were a number of cases where the use of IBS had not

led to total satisfaction and may have actually been less productive

than conventional methods. IBS has been associated in the past with

low-quality buildings, leakages, abandoned projects and other such

drawbacks delivered by contractors.

3.2 There were also cases where building projects were awarded and

constructed by the contractor using IBS but contributed to the

project delays and bad qualities. Contractors also produce poor

workmanship, particularly in applying waterproofing materials and

column and beam alignment.

3.3 Majority of contractor involve in IBS suffered from poor productivity

and financial performance. This is due to the fact that contractors

have to pay the supplier upfront to purchase components. It is a high

capital investment where 30% of the value of the project is to be

paid up front. A delay in the payment means a delay in the

components’ delivery, which eventually affects the productivity of

the projects.

3.4 It is worth noting that in 2008, the Malaysian government made the

use of IBS compulsory in all newly constructed public building. Since

then, the importance of capable contractors to construct public

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building has increased. Nonetheless, there are still limited numbers of

contractors in Malaysia specialising in IBS that can undertake IBS jobs.

3.5 In order to be a specialist in IBS, contractors need to furnish

themselves with the necessary knowledge in implementing IBS. Their

organisations also require some changes with regards to their

process, practices, procedure and administration to embrace IBS.

3.6 Therefore, the role of training and education is important to support

contractors to implement IBS. To deal with this matter and to

produce contractors which capable to undertake IBS projects under

SPP 7: 2008, the Construction Industry Development Board (CIDB) has

organise training for contractors to be vendor of specialist

contractors (installer) for IBS. Nonetheless the effectiveness and the

impact of this training has never been measure and the current state

of contractors is not known.

4.0 Training and Education

4.1 Training and education can be considered as an integral part of an

organisation’s learning and change. Training often embraces

learning and development, experiential learning and cognitive

abilities, and can also considered as a management tool and

instrument for addressing skill deficiencies.

4.2 The primary rationale for training is to adapt employees’

qualifications to job requirements. Although IBS is used to address skill

shortage problems in the construction industry, evidence suggests

that a skilled workforce in specific skill areas such as integration,

coordination and component installation becomes more important

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than in conventional methods due to different undertaken roles and

project methods. Therefore, training is important, especially to

people involved in design, handling, positioning and erecting the

finished product.

4.3 The application of IBS requires a high level of techniques and

precision compared to the conventional method, and therefore

requires continuous trainings. Training labour in innovative method by

ensuring the team received appropriate and thorough training in

new and unfamiliar method in advance of the installation. Whenever

innovative or unfamiliar methods and material is used, operative

should be trained in the application preferably by the supplier or

manufacture before the installation start.

5.0 The Survey

5.1 In 20th July 2011, Construction Research Institute of Malaysia (CREAM)

had received a request from the CIDB to analyse survey of the

effectiveness and impact of IBS training to contractors. The survey

form was developed by CIDB and it includes the process of data

collection, sample proportion and actual data collection as well.

CREAM received the survey forms by stages from 1st August until 5th

August 2011 and completed the final report on 31st August 2011.

5.2 The aim of this study is to determine the effectiveness and impact of

IBS training to contractors in the Malaysian construction industry. To

achieve this aim, the following objectives are being established as

follows:

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5.2.1 To study the number of projects (government / private

sector) that have been implemented by contractors

after attending IBS training by the CIDB

5.2.2 To review the contractor's perspective on the

effectiveness and impact of IBS training

5.2.3 To study the factors that may contribute to the

success of the contractors

5.2.4 To propose recommendations and measures to

improve the quality of training provided by the CIDB

5.2.5 To propose recommendations and measures to

improve quality of training by the CIDB

5.2.6 To propose the way forward for contractors in

adopting IBS

5.3 The data collection used in this research is the quota sampling.

Quota sampling is the numbers probability equivalent of stratified

sampling. Like stratified sampling, the stratums and their proportions

were first identified as they are represented in the population. Then

convenience or judgment sampling is also used to select the

required number of subjects from each stratum. This differs from

stratified sampling, where the stratums are filled by random sampling.

5.4 A total of 35 questionnaires from respondents of all categories of

contractors were obtained from IBS Centre. The information and

data gathered through questionnaire will be compiled and

processed using statistical methods in relation to the objectives of

study. Two statistical methods will be applied, namely descriptive

statistic and inferential statistics. Result from the findings will be

presented in the form of graphs, histogram and pie chart for easier

understanding.

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5.5 As research goes, this study has its own limitation that affected the

results of the findings. The number of cases (35 questionnaires) is too

limited for broad generalisations to the population. Regarding to the

data limitations, the study should not be taken as completely

accurate or representative of the study.

6.0 Survey Data and Analysis

6.1 This section presents the analysis and the results of the research

survey form. The data and the results were analysed and presented

to conform the objectives at the beginning of the report.

The Table 1 and Figure 1 above show the respondents’ registration grade

under CIDB. Most of the respondents are G1 contractors with 55.9%, follows

by G2 contractors with 14.7%. The minority is from G3, G4, and G5 which are

5.9% each while G7 contractors represent 11.8% of the sampling.

Table 1: Respondent registration under CIDB

Type of Contractor's Registration Frequency Percentage (%) G1 19 55.9 G2 5 14.7 G3 2 5.9 G4 2 5.9 G5 2 5.9 G7 4 11.8 Total 34 100.0

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Figure 1: Respondent registration under CIDB

Table 2 and Figure 2 above depicted the information on respondents’

background. 77.1% of respondents are owner or managing director of the

company, 11.4% are project managers, 5.7% are technical assistants and

2.9% are project engineers. This statistic shows that the relevant professionals

respondent to their survey, thus increase the validity of the results.

Table 2: Respondents’ professional background

Position Frequency Percentage (%)

Company Owner 27 77.1 Project Engineer 1 2.9 Technical Assistant 2 5.7 Project Manager 4 11.4 Other 1 2.9 Total 35 100.0

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Figure 2: Respondents’ professional background

Referring to Table 3 and Figure 3, 19 respondents that are working in the

construction industry for between 5 and 10 years and 8 out of total

respondents have had 11-15 years working experience. Since most of the

respondents have more than 4 years working experience and this represents

that the data acquired is quite reliable and accurate.

Table 3: Respondents’ Working Experience

Working Experience Frequency Percentage (%)

0-4 years 2 5.7

5-10 years 19 54.3

11-15 years 8 22.9

More than 15 years 6 17.1

Total 35 100.0

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Figure 3: Respondents’ Working Experience

From the table above, it shows that only seven respondents which are 22.6%

of the total respondents that have implemented IBS project after complete

the training. The highest percentage whereby the number of projects

implements IBS is no project which consists of 91.4% of the total respondents.

Next it is followed by less than 5 projects that number

of IBS projects undertaken by the company with 5.7%. Lastly there are only

2.9% of the respondents that have undertaken of IBS project into their 5-15

projects. From the analysis above, it can be summarized that the number of

IBS projects undertaken by the company is still very low. There are only three

numbers of projects that has been done for public sector and no project for

private sector. Two companies have total value of RM 15-30 million and only

one company have total value of RM 5-15 million.

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Figure 4: The percentage of contractors involved in IBS tender

Table 4: Number of IBS Project Undertaken by the Company

Number of Project Frequency Percentage (%)

No project 32 91.4

5-15 project 1 2.9 Less than 5 project 2 5.7 Total 35 100.0

Table 5: Total value of IBS project

Total value of IBS project Frequency Percentage (%) No value 32 91.4 RM 5-15 million 1 2.9 RM 15-30 million 2 5.7 Total 35 100.0

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From the table above, it shows that only seven respondents which are 22.6%

of the total respondents that have implemented IBS project after complete

the training. Most of the IBS projects conducted by these contractors are

school with 42.9% followed by Government Office Building with 28.6% and

the least type of project is hospital with 14.3%.

Table 6: Type of project IBS project types Frequency Percentage (%) School 3 42.9 Government Office Building 2 28.6 Hospital 1 14.3 Other 1 14.3 Total 7 100.0

Figure 5: Type of IBS Project

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The contractor prefer large panel system with 25% followed by metal or steel

formwork system with 18.8% and the least used IBS system is block works

system with 12.5%. It worth knowing, 43.8% prefer other system most probably

precast structure or timber.

Figure 6: Type of system used in IBS project

Based on the results obtained from the questionnaire, it can be summarized

that generally all the respondents moderately agree with the effectiveness

of IBS training. It can be concluded that most of the respondents satisfied

with the content of the IBS training course. Most respondent agree that the

method of teaching is very important with a mean score of 4.35. This is

because the method of teaching makes the respondents easy to

understand the topic. Next is followed by professionalism of trainers with 4.29.

However, most of the respondents felt that the training did not provide an

adequate training period and sufficient practical training into the course.

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Table 7: Training Effectiveness of IBS Centre

Training Effectiveness of IBS Centre Frequency

Score 1 2 3 4 5 Mean Score Position Indicator

Manner of service of teaching is good 0 0 2 16 13 4.35 1 Agree The top and professional trainers 0 1 1 17 12 4.29 2 Agree Training centres with good facilities 0 1 3 16 11 4.19 3 Agree Conducted appropriate syllabus 0 0 2 22 7 4.16 4 Agree Skills learned help you 0 1 3 20 7 4.06 5 Agree Adequate theoretical training 0 1 1 25 4 4.03 6 Agree Adequate training term 0 0 5 21 5 4.00 7 Agree Adequate training period 0 0 7 20 4 3.90 8 Agree Sufficient practical training 1 1 6 20 3 3.74 9 Agree

In Table 8, most of respondents agree that the training conducted by CIDB

assisting respondent in carrying out project of IBS with 86.2%.

Table 8: The effectiveness of IBS training for contractor

Respondent's answer Frequency Percentage (%)

Yes 25 86.2 No 4 13.8 Total 29 100.0

The Figure 7 shows the types of training that shall be conducted by the CIDB

in the future according to contractors. 30.3% of respondents agree that

training on installation roof trust must be conducted by the CIDB in the future

for contractors. It followed by project management with 24.2% and

entrepreneurship with 21.2%.

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Figure 7: Types of future training preferred by contractors

Most of the respondents agree that implementation of government projects

under SPP 7: 2008 gives benefit to contractors (Table 9):

Table 9: Perspective of contractors on the implementation of IBS in government building

Benefit to the contractor Frequency Percentage (%) Yes 29 82.9 No 6 17.1

Total 35 100.0

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Based on the results obtained from the questionnaire, it can be summarized

that generally all the respondents agree with the challenges faced by

contractors in carrying out project IBS. Most noted challenges that

contribute to the success of IBS contractor is the main challenge to be

involved in IBS is no IBS project at the mean score of 4.26. It follows by high

dependency on the manufacturer with 4.40 mean score. There are two

sections which get the mean score less than 4.00 which indicated that the

least score in the challenges faced by contractors in carrying out of project.

Most of the respondents are not agreeing that IBS reduce company profits

because IBS is actually can increase the profit of the company.

Table 10: Challenges faced by Contractors in Carrying out IBS Projects

Challenges Faced By Contractors in Carrying Out Projects IBS Frequency

Score 1 2 3 4 5

Mean Score Position Indicator

No IBS project 1 2 18 14 4.26 1 Agree Too dependent on the manufacturer 5 16 14 4.26 2 Agree

Less incentive implement IBS 2 2 19 12 4.17 3 Agree No capital 1 6 16 12 4.11 4 Agree political contact and position 1 8 14 12 4.06 5 Agree risk in the project IBS 1 5 22 7 4.00 6 Agree No skills 5 25 5 4.00 7 Agree No IT skills 1 6 22 6 3.91 8 Agree

IBS reduce company profits 2 2 11 13 7 3.60 9 Less agree

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Based on the results obtained from the questionnaire, it can be summarized

that generally all the respondents agree with the factors that contribute to

the success of IBS contractor listed in the question. The most important factor

that contributes to the success of IBS contractor is knowledge on IBS which

stands at the mean score of 4.46. This is because the contractor feels that

knowledge is very important to the success. Next is followed by positioning

and financial strength with 4.40. There are three sections which get the

mean score less than 4.00 which indicated that the least score in the factors

that contribute to the success of IBS contractors. Most of the respondents are

less agree that use of IT, Investment and political contact and position is

important factors that contribute to the success of IBS contractors.

Table 11: Factors that Contribute to the Success of IBS Contractor

Factors That Contribute To the Success of IBS Contractor Frequency

Score 1 2 3 4 5

Mean Score Position Indicator

Knowledge about IBS 1 17 17 4.46 1 Strongly agree Positioning and financial strength 1 2 14 18 4.4 2 Agree

Skilled workers 22 13 4.37 3 Agree Technology 1 2 21 11 4.20 4 Agree Supply chain net 2 3 18 12 4.14 5 Agree Business strategy 6 21 8 4.06 6 Agree Use of IT 1 5 23 6 3.97 7 Agree Investment 2 7 19 7 3.89 8 Agree Political contact and position 2 11 16 6 3.69 9 Agree

The Table 12 and Figure 8 above show the respondent’s answer whether

contractors should be involved in the manufacturing component of IBS

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component. Most of the respondents agree that contractor should be

involved in the manufacturing of IBS component. Only 11.4% does not agree

that contractor should be involved in the manufacturing activities.

Table 12: Contractors Involved in the Manufacturing Component of IBS

Respondent's answer Frequency Percentage (%) Yes 31 88.6 No 4 11.4

Total 35 100.0

Figure 8: Contractors Involved in the Manufacturing Component of IBS

From Table 13 and figure 9 above show the respondent’s answer whether

the contractors have to be a specialist in the IBS. Most of the respondents

agree that the contractor have to be a specialist in the IBS with 88.6% and

only 11.4% does not agree that the contractor have to be a specialist in the

IBS.

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Table 13: Contractors have to be a Specialist Contractor in the IBS

Respondent's answer Frequency Percentage (%)

Yes 31 88.6 No 4 11.4

Total 35 100.0

Figure 9: Contractors have to be a specialist contractor in the IBS

Based on the results obtained from the questionnaire, it can be summarised

that generally all the respondents agree with the measures to be taken by

the CIDB. Most of the respondents strongly agree that contractor should get

better incentives at the mean score of 4.51 followed by assist in the IBS

component manufacturers and assist in the supervision of capital with each

have mean score of 4.46. Since all the mean score is more than 4.00, it can

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be concluded that all measures that need to be taken by the CIDB are

important.

Table 14: Improving measures to be taken by the CIDB

Measures To Be Taken By the CIDB Frequency Score 1 2 3 4 5

Mean Score Position Indicator

Better incentives 1 15 19 4.51 1 Strongly Agree

Assist in the IBS component manufacturers 2 15 18 4.46 2 Agree

Assist in the supervision of capital 1 17 17 4.46 3 Agree Better training modules 1 20 14 4.37 4 Agree Assist in the preparation of business plans 2 19 14 4.34 5 Agree

IBS contractor documenting good practices 1 21 13 4.34 6 Agree

awareness programs 1 21 13 4.34 7 Agree establish IBS "standards and guideline" 2 21 12 4.29 8 Agree

Online training modules 1 7 17 10 4.03 9 Agree

Based on the results obtained from the questionnaire that action to be taken

by contractor to involve in IBS, it can be summarised that generally all the

respondents agree. Most of the respondents strongly agree that partnering is

the most important aspect to promote the contractor at the mean score of

4.57 followed by creating cluster of IBS with mean score of 4.40. All the

measure is greater than 4.00 except for looking opportunities abroad. The

contractor felt that century abroad is risky and involve capital investment.

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Table 15: Action to be taken by contractor to involve in IBS

Measures To Promote the Contractor in the Field Of IBS Frequency

Score 1 2 3 4 5

Mean Score Position Indicator

Partnering 15 20 4.57 1 Strongly Agree Create a cluster of IBS 21 14 4.40 2 Agree Improve skills 22 13 4.37 3 Agree Be a specialist contractor 2 20 13 4.31 4 Agree Be the IBS manufacturer 4 18 13 4.26 5 Agree Increasing use of IT 1 24 10 4.26 6 Agree R & D and innovation 2 23 10 4.23 7 Agree Looking for opportunities abroad 13 13 9 3.89 8 Agree

The most important factor to the contractor that has been recognized by

the respondents is the financial strength and knowledge about IBS.

Partnering and technology is also score fairly high in the level of importance.

Factor such as contacts and looking for opportunities abroad are consider

less important by contractors.

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Table 16: Ranking of factors that are important to contractors in IBS

Importance Factor Mean score Ranking Position and financial strength 1.8 1 Knowledge about IBS 1.86 2 Partnering 1.94 3 Technology 2 4 Improve skills 2.11 5 Skilled workers 2.2 6 "Investment" 2.2 7 Business strategy 2.26 8 Supply chain network 2.37 9 R&D and Innovation 2.37 10 IT usage 2.4 11 Create a cluster of IBS 2.49 12 Contacts and political position 2.49 13 Looking for opportunities abroad 2.83 14

7.0 Conclusion

7.1 The research reveals that the main attribute to the lack of

contractors embracing IBS are rarely purely technical in origin. They

are more related to the organisational strategy and soft issues which

underpin the capability of organisation to successfully implement IBS.

This led to the identification that IBS is best handled as a holistic

process and it requires a total synchronisation on construction,

manufacturing and design processes. An improved approach to

project management, procurement, rationalisation, standardisation,

repetition, collaboration, integration, supply chain partnering,

planning, skills and training was proposed.

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7.2 IBS knowledge is still very much needed to improve in IBS field. The

contractor should know well about IBS before plunge in IBS sector.

7.3 Position and financial strength is very important aspect that

contributes to the IBS contractor. The high cost is believed to be due

to lack of economy of scale in IBS projects and business monopoly by

the small number of IBS producers in Malaysia

7.4 Contractors need to be involved in small scale production for them

to reduce dependency on manufacture.

7.5 Lack of knowledge is still the main barrier for bold adoption.

8.0 Recommendation

8.1 From the survey done, the skill gap exists are identified in IBS sector. In

order to create a comprehensive and systematic training

programme, the government should conduct comprehensive

preliminary study. The preliminary study will ensure that the training

fits the needs of IBS organisations and accommodates current skill

shortages in the market, particularly specialist skills such as design

and installation, based on information from real practice.

8.2 Contractors need a strategy for a better project approach and for

the sustainability of their business.

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8.2.1 G1-G3: Specialist installer (installation)

8.2.2 G4-G5: IBS production and installation

8.2.3 G7: Complete all the IBS system (design and

installation)

8.3 Position and financial strength is very important factor to the

contractor to implement IBS. Financial aspect such as loan facilities

and the payback system that can be implemented in the current

banking system. Most of the financial institution reluctant to provide

loan/finance to IBS manufacturer.

8.4 Give better incentives (tax relieve, duty free on imported machinery,

soft loan/interest free (SME) from government financial) to the

contractor is the measure that need to be taken into account in

order to attract contractor to implement the IBS.

8.5 CIDB should conduct more seminar and workshop or training course

to increase the knowledge of contractor about IBS. Knowledge is

very important in order to make contractor interest to involve in the

IBS project. More workers should be trained of IBS knowledge.

8.5.1 G1-G3: installation

8.5.2 G4-G5: small to medium technology, flat, culvert

8.5.3 G7 : High Rise building/ green technology

9.0 Transformation Framework for Contractor to Adopt IBS

9.1 In general, a strategic framework to transform traditional contractor

to IBS is based on nine critical success factors and two important

enabling factors which have been identified in the literatures and in

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the case studies. The critical success factors have been categorised

into four elements. The elements are:

• Strategy (corporate leadership and business strategy)

• People (skills, training and education)

• Process (procurement and contract, project management,

technology selection, design management and integration, and

management of the supply chain)

• Enabler (IT tools and continues improvement)

The framework is depicted in Figure 10:

Figure 10: Transformation Framework

STRATEGY

PEOPLE

PROCESS

ENABLER

• Information Technology

• Improvement

• Corporate

Leadership • Business

Strategy

• Skills • Training &

Education

Procurement & Contract

Project Managemen

Design Management

and Inte

Capability Loop

gration

Technology Selection

Management of supply chain

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9.2 In general, the main causes of the lack of contractors embracing IBS

are rarely purely technical in origin. They are more related to the

organisational strategy and soft issues which underpin the capability

of the organisation to successfully implement IBS. The prerequisite of

success depends to a large extent on the establishment of strategy,

meetings of human capability and capacity and finally the

processes.

9.3 First, contractors need to obtain full support from the top

management and align the business strategy, vision and mission with

IBS, and these elements in return are important to convince the

decision makers, clients and their own organisation structure to use

the IBS method. This support and commitment shall drive the

company forward in terms of investment and resources allocation.

Contractors need to develop and adopt a specific model in their

business and to position themselves in the market. This model includes

diversifying of business, setting up a specific division to deal with IBS

and offering a wide range of services in IBS.

9.4 The second element is the development of people capacity. People

can be considered as core drivers to business. As a collective force

they can add value to organisation. People development is the most

important aspect in the organisations. However, they must be in

place to understand organisational processes, implement change

when necessary, and the use of technology to accelerate their

efforts. Migration from the conventional to IBS requires new skills sets

such as integration, design, planning and supply chain which relate

to IBS implementation. It is imperative for the contractor to employ

appropriately skilled operators at site or enable a range of tasks to

be undertaken by fewer but multi-skilled operators. People must

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however be led, the importance of leadership stems from its role in

providing a clear vision of the future and communicating the vision. It

is therefore essential to obtain optimal human capital and skills,

which in turn is represented through the selecting right people for the

right jobs which could improve innovation and creativity. If the

company has the right people, the problem of how to motivate and

manage people largely goes away. On the other hand, if the

company has the wrong people, it does not matter whether or not

they discover the right direction – it is still difficult for the company to

embrace change. Great vision without great people is irrelevant.

Training can be considered as an integral part of organisation

change. The workers need to be trained in IBS skill sets.

9.5 The third element is development in process. Contractors need to

enhance their processes in procurement, project management,

technology selection, design integration and supply chain. Selection

of contract enables them to effectively select and implement

technology and facilitate better design integration. The

improvement in project management means adopting a better

supply chain strategy and enables design integration to take place.

9.6 The final element in the transformation from a conventional method

to IBS is the role of enablers such as Information Technology (IT) and

continuous improvement. IT can play an integral part in many IBS

processes and would be a reliable support tool for design and

project management. Continuous improvement is also critical in

embracing the IBS method. The repetitive process each time the

project is implemented in IBS allows continuous improvement to take

place for better project performance. Both IT and continuous

improvement are important enablers and support tools in the

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development of strategy, people and process for IBS companies, as

depicted in the framework.

9.7 Successful IBS implementation in Malaysia is due to a strong support,

commitment, awareness, vision, knowledge and leadership and

capability to align IBS implementation with corporate strategy.

Therefore, the prerequisite of success in IBS depends to a large extent

on the establishment of the strategy first, followed by meetings of

human capability and capacity and improvement to the processes

as depicted in the final framework.

9.8 However, implementing this framework is a monumental task for

contractors. Improvements in all of the above four elements are

highly dependent on the capability of the contractors. This is clearly

stressed in the focus group. The focus group highlighted that the

capability and maturity is a major issue for change progress and

ensures IBS success. It was highlighted that the majority of the

contractors in Malaysia are not ready to embrace IBS. If the

contractors do not acquire the capability to change to IBS, they

need to embark on extensive development on people capacity. It

must be recognised in the first place that the transformation from

conventional methods to IBS stems not out of technology but

people. The development of human capital will enhance the overall

organisation’s capability in adopting IBS.

9.9 Once the company has enough capability, supported by highly

knowledgeable IBS personnel, they will start again to realign the

overall company’s strategy to the IBS. This is described in the

framework as the capability loop. It is worth noting that the

transformation to IBS concerns change, and not just a routine

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change but a fundamental change. Furthermore, the change from

a conventional method to IBS is a journey over time. As the

environment changes, these external dynamic must be matched as

far as possible by internal change. There is a need to evolve

constantly. Highlighting a number of critical success factors which

underpin the framework will hopefully help contractors guide their

own organisations towards IBS success without having to learn these

lessons the hard way.

9.10 The readiness model should be developed in future to further

enhance this framework. In this context, an advanced state of

organisation readiness is needed for business to expend domestically

and internationally, to compete readily in the global open market

and optimise the adoption of IBS. It is therefore, imperative that

organisations align their business strategies with IBS strategies. Based

on the readiness model, the level of readiness (both the current and

target) should be clear and indicative of the organisation’s situation

in terms of measurable attributes and maturity levels. By identifying

the current and the required organisation status, the readiness gap

can be determined and the route of transformation progress

becomes visible. Progress can be accomplished when the

organisation moves through the levels in sequential order.

10.0 Buildoffsite Accreditation Scheme

10.1 The scheme has been set up by Buildoffsite, the body that

campaigns for the greater uptake of off-site building solutions,

in association with Lloyds Register EMEA to standardise and

ensure best practice across all aspects of the off-site process,

from the submission of tenders through the awarding of

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contracts to the specification, design, manufacture,

construction, handover and even the ongoing maintenance

of a completed building. It also integrates existing quality

assurance and environmental performance certification

under, for example, ISO 9001 and ISO 14001.

10.2 By choosing a supplier registered under the scheme, client

organisations can be confident of the assured levels of

competence, methodology and safe working from

companies that have standardised best practice for the

delivery of their products and services. It will give clients

greater confidence with regards to a company’s technical

competence, effective methodology and commitment to

safety.

10.3 The Buildoffsite Registration Scheme is operated in

collaboration with other organisations that may be able to

provide specialist focus, such as the British Board of

Agreement. Its operating philosophy is to evaluate the control

measures taken by a service provider to mitigate any risks to

the safe and competent delivery of their products and

services.

10.4 By taking this approach it focuses on the way the products

and services are delivered rather than laying down standards

for the products and services themselves. This provides the

flexibility to cover a wide range of different approaches whilst

still setting a benchmark for best practice

10.5 The benefits of the scheme are:

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10.5.1 It provides client organisations with greater

confidence of delivery to time, cost and quality

through the implementation of risk management best

practice

10.5.2 It provides management and shareholders with the

assurance that their risk management, competency

management and configuration management

systems have been independently validated as

meeting best practice with the attendant likelihood of

costly mistakes minimised

10.5.3 It represents a key element of the Buildoffsite Property

Assurance Scheme and will facilitate a route to

market for the offsite provider with recognition of the

scheme by all major lenders including RBS, Lloyd’s

Bank, Santander and Nationwide, together with RICS

and the valuer community

10.6 Methodology

10.6.1 The company will register under the scheme

10.6.2 The company will be audited by the 5 criteria of the

success factors in offsite

10.6.3 The company will me measure by benchmarking tools

and given the marks based on the control measures

taken by a service provider to mitigate any risks to the

safe and competent delivery of their products and

services.

10.6.4 The successful company that received pass or

excellence marks will be given certification of

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accreditation. The accreditation is recognise by all

major lenders including RBS, Lloyd’s Bank, Santander

and Nationwide, together with RICS and the valuer

community