KEY ORGANIZATIONAL RISK FACTORS: A CASE STUDY OF

HYDROELECTRIC POWER PROJECTS IN MYANMAR

by

Aung Myo Hein

A thesis submitted in partial fulfillment of the requirement for the

Degree of Master of Engineering in
Construction Engineering and Infrastructure Management

Examination Committee : Dr. Chotchai Charoenngam (Chairperson)

Dr. B.H.W. Hadikusumo
Dr. Noppadol Phien-wej

Nationality: Myanmar
Previous Degree: Bachelor of Civil Engineering
Yangon Technology University
Myanmar

Scholarship Donor: AIT Fellowship

Asian Institute of Technology

School of Engineering and Technology
Bangkok, Thailand
May, 2009

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 ACKNOWLEDGEMENTS

First of all, I express my wholehearted gratitude to my beloved parent who supported

financially and encouraged mentally during study in AIT. They ever give forgiveness and
show their kindness whenever I fell down.

To begin with, I would like to express my sincere gratitude to Dr. Chotchai Charoenngam, the
intellectual giant as my admire thesis advisor who trained me to become as a warrior. I would
like to thank him for the guidance, patient, promoting development comments and all
unforgettable memorial events for the accomplishment of this study. I am grateful for working
with the brilliant adviser who assembled my mind how to struggle the challenges without
being scared.

I would like to express my gratefulness to thesis examination committee members as well as

academic adviser, Dr. Bonaventura H.W. Hadikusumo who encouraged and gave valuable
advice during academic study and Dr. Noppadol Phien-wej who provided substantial study
support in the early stages of the study. Their guidance, helpful recommendation and valuable
comments made the study to be brighter and were of great contribution to the study.

Grateful acknowledgements are extends to Minister of Electric Power-1 (Myanmar) who gives
me opportunity to study in DHPI’s projects, top managements of Department of Hydropower
Implementation (DHPI), senior management and all participants who shared their valuable
time from Construction Division (2) and (3). Their sincere cooperation and attention lead to
the successful surveys.

My great thankfulness belongs to all dear CEIM friends especially Karma G., Thotsaphol R.,
and Panwimon J., for their warmly assistance and patient on me. In conclusion, I would like to
say many thanks to all peoples who help me partially to complete this study. I will never ever
forget your help and our friendship will continue as long as my breathing.

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 ABSTRACT

Organizational risk, generally defined as the risk that the organizational configuration of a
company does not support the achievement of its strategy, therefore becomes vital to manage
for companies in the post-industrial era. The study focused on the internal key risks factors of
construction project organization and how the organizational risk factors cause the problems
and deficiency of construction lead to project delay. Then the objectives of study is to identify
key organizational risk factors which cause deficiency of project and the rationale of
organizational risk factors to project risk which create the negative outcomes of the project.
Eventually, recommendation for the improvement of organizational risk management that is
appropriate for construction project organization is followed.
Multiple cases study approach (two construction divisions) is conducted in order to have
robust results of the study. Opening process of study is risk factors identification which
consists of initial factors and verification of the factors. Then, data collection is followed by
interviewing practitioners in the projects with verified checklist, collecting project documents
and site observation. Data analysis is conducted by description of differences risk factors
between construction divisions and explanation of overall risk factors of both cases study
towards the gathered information.
Research findings confirm that different risk factors are influenced in both construction
divisions and overall top rank risk factors are embedded in nine internal organizational
networks which are necessary to control for improvement of project organizations. These top
risk factors are 1) Technology constraints, 2) Time constraint resource scheduling, 3)
Inaccurate information, 4) Technical Incompetency, 5) Lack of skilled workforce, 6) Delay
major equipment, 7) Insufficient human resource, 8) Resource constraint project scheduling,
9) Sub-quality resource, 10) Lack of regular meeting and 11) Mistrust between parties. The
proposed guideline of organizational risk management assists the top management of DHPI in
order to make precise decision for managing risks in organization. Multi-dimensional causes,
effects, rationale of organizational risk factors to project risks and recommendation for
manageable factors mentioned above were discussed in this study.

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 TABLE OF CONTENTS
CHAPTER TITLE PAGE

Title Page i
Acknowledgement ii
Abstract iii
Table of Contents iv
List of Figures vii
List of Tables ix
Abbreviation x

1 INTRODUCTION
1.1 Background 1
1.2 Climate of Myanma Hydropower Development 1
1.3 Problem Statement 4
1.4 Objectives of Study 5
1.5 Scope of Works 5
2 LITERATURE REVIEW
2.1 Risk and Construction 6
2.2 Organizational Risk 7
2.3 Managing Risk in Organization 9
2.3.1 Communication and Coordination 10
2.3.2 Inter-firm cooperation 12
2.3.3 Cross-functional team 12
2.4 Practical Limitation of Risk Management 13
2.4.1 Risk Identification 14
2.4.2 Assessing Impacts of Risk Events and Evaluation Process 15
2.4.3 Risk Response Planning 15
2.5 Risks Interlocked Networks of Project Organization 17
2.6 Internal Organizational Networks 18
2.6.1 Social Network 19
2.6.2 Knowledge Network 20
2.6.3 Information Network 21
2.6.4 Resource Network 22
2.6.5 Resource Usage Requirements 23
2.6.6 Inter-operability and Co-usage requirements 23
2.6.7 Assignment Network 23
2.6.8 Knowledge Requirements 24
2.6.9 Resource Requirements 24

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 2.6.10 Precedence and Dependencies 24
2.7 Summary 24
3 RESEARCH METHODOLOGY
3.1 Introduction 26
3.1.1 Selection of Research Method 26
3.1.2 Research Approach 27
3.1.3 Research Methodology Framework 28
3.2 Risk Factors Identification 31
3.2.1 Interviewing and Verification of Initial Risk Factors 32
3.3 Data Collection 34
3.3.1 Question Design 35
3.3.2 Pilot Test 35
3.3.3 Project Selection for Case Studies 35
3.3.4 Interview Plan 35
3.4 Data Analysis and Validation 36
3.5 Case Study Report 38
4 CASES STUDY ANALYSIS
4.1 Organizational risk management 39
4.1.1 Risks in Internal Organizational Networks 40
4.2 Organization Background 42
4.2.1 Construction Division (A) 42
4.2.2 Construction Division (B) 44
4.2.3 Case Study Overview 44
4.3 Practical Risk Management in Organization 45
4.4 Differences Risk Factors between Cases Study 47
4.4.1 Social Network 48
4.4.2 Knowledge Network 49
4.4.3 Information Network 52
4.4.4 Resource Network 53
4.4.5 Resource Usage Requirements 56
4.4.6 Inter-operability and Co-usage requirements 59
4.4.7 Assignment Network 61
4.4.8 Resource Requirements 63
4.4.9 Precedence and Dependencies 65
4.4.10 Summary 68

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 4.5 Overall Ranking of Key Organizational Risk Factors 71
4.5.1 Technology Constraint 73
4.5.2 Time Constraint Resource Scheduling 74
4.5.3 Inaccurate Information 75
4.5.4 Technical Incompetency 76
4.5.5 Lack of Skilled Workforce 77
4.5.6 Delay Major Equipment 78
4.5.7 Insufficient Human Resource 79
4.5.8 Resource Constraint Project Scheduling 81
4.5.9 Sub-quality Resource 81
4.5.10 Lack of Regular Meeting 82
4.5.11 Mistrust between Parties 83
4.5.12 Guideline of Organizational Risk Management 86
4.6 Activation the Logic Model of Organizational Risk Management 86
4.7 Recommendation for improvement of DHPI’s Projects Efficiency 88
5 CONCLUSION AND RECOMMENDATIONS
5.1 Introduction 89
5.2 Research Findings 89
5.3 Difference Top Rank Risk Factors in Con (A) and (B) 89
5.4 Overall Risk Factors in Internal Organizational Networks of DHPI 90
5.5 Recommendation for Organizational Risk Management in DHPI 91
5.6 Recommendation for Further Study 91
6 REFERENCES 92
APPENDIX (A) Checklists 96
APPENDIX (B) Analysis results of Checklists 102
APPENDIX (C) Cases Study 109

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LIST OF FIGURES

FIGURE TITLE PAGE

1.1 Major elements in organization 4
2.1 Probable outcome of construction project 6
2.2 Characteristic of risks in construction 7
2.3 Direct and indirect of organizational risks 8
2.4 Risk Management process 10
2.5 Comparison of traditional and modern functional model 13
2.6 Risk identification process 15
2.7 Strategies to cope with risk 16
2.8 Organization risk analyzer 18
3.1 Research approach 28
3.2 Research Methodology Framework 30
3.3 Organization risk analyzer 31
3.4 Verification risk factors and questionnaire process 33
3.5 Verified organizational risk factors 34
3.6 Data analysis procedure 37
4.1 Location of cases study 43
4.2 Limitation of accountability and decision making process 47
4.3 Senior Management progress and coordination meeting, Con (A) 51
4.4 Weekly Project Meeting, Con (A) 51
4.5 Quality control of input Materials in Con (A) 55
4.6 Technical incompetency of organization, Con (B) 57
4.7 Implemented projects of organization in five decades 59
4.8 Percentage of project received required resources in quarterly 60
4.9 A part of gantry crane transportation to project 61
4.10 Maximum installed capacity in each decade 62
4.11 Delay resource of Con (B-1), Kun Project 65
4.12 Percentage of organization supported resource in 1st quarter to
Con (A) 67
4.13 Percentage of organization supported resources in first three
quarter to Con (B-1), Kun Project 67
4.14 Percentage of organization supported resources in first three
quarter to Con (B-2), Phyu Project 68
4.15 Logic model of organizational factors and project risk in
precedence and dependencies 73
4.16 Logic model of organizational factors and project risk in inter
Operability and co-usage requirement 74
4.17 Logic model of organizational factors and project risk in
information network 75
4.18 Logic model of organizational factors and project risk in knowledge
usage requirement 76
4.19 Logic model of organizational factors and project risk in resource
usage requirement 78

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FIGURE TITLE PAGE
4.20 Logic model of organizational factors and project risk in resource
requirement 78
4.21 Permanent employees of Yeywa Hydroelectric Power Project
In May, 2008, Construction Division (A) 79
4.22 Experience and education background of employees
in organization 80
4.23 Logic model of organizational risk factors and project risk in
assignment network 80
4.24 Logic model of organizational risk factors and project risk in
precedence and dependencies 81
4.25 Logic model of organizational risk factors and project risk in
resource network 82
4.26 Logic model of organizational risk factors and project risk in
knowledge network 83
4.27 Logic model of organizational risk factors and project risk in
social network 85
4.28 Guideline of organizational risk management 86
4.29 Interrelation of risk factors in project organization 87

viii
LIST OF TABLES
TABLE TITLE PAGE

1.1 Hydropower potential in Myanmar 2

1.2 Implemented and commission hydroelectric
Power Project of DHPI 3
2.1 Sequence of risk due to lack of information 22
3.1 Cases study interviewees list 36
4.1 Internal network of construction organization 39
4.2 Risk factors influencing in network of organization 40
4.3 Profile of Organization, DHPI 42
4.4 Profile of Construction Division (A) 43
4.5 Profile of Construction Division (B) 44
4.6 Practical overview of risk management checklist in project
organization 45
4.7 Data analysis results of social network in Con (A) and (B) 48
4.8 Data analysis results of knowledge network in Con (A) and (B) 50
4.9 Data analysis results of information network in Con (A) and (B) 52
4.10 Data analysis results of resource network in Con (A) and (B) 54
4.11 Data analysis results of resource usage requirement
in Con (A) and (B) 56
4.12 Data analysis results of inter-operability and co-usage requirement
in Con (A) and (B) 59
4.13 Data analysis results of assignment network in Con (A) and (B) 61
4.14 Permanent employees in Con (A) 63
4.15 Data analysis results of resource requirement in Con (A) and (B) 63
4.16 Data analysis results of precedence and dependencies
in Con (A) and (B) 65
4.17 Comparison of top ranks key risk factors in Con (A) and (B) 70
4.18 Analysis of overall organizational factors influencing project 71
4.19 Different parties in Con (A) with their responsibilities 84
4.20 Recommendation for improvement of project efficiency 88

ix
 ABBREVIATION

MOEP (1) Ministry of Electric Power (1), Myanma

DHPI Department of Hydropower Implementation
CPE Colenco Power Engineering Co.ltd (Switzerland)
NEPS
CGGC China Gezhouba Water & Power Group Co.,Ltd
CNEEC China National Electric Equipment Corporation
CCYW Joint Venture Consortium of CITIC Technology Co.Ltd and Sino Hydro
Corporation Limited
CHMC China National Heavy Machinery Corporation
Con (A) Construction Division (A), Yeywa Hydroelectric Power Project
Con (B) Construction Division (B), Kun and Phyu Hydroelectric Power Project
Con (B-1) Kun Hydroelectric Power Project
Con (B-2) Phyu Hydroelectric Power Project
DG Director General
DDG Deputy Director General
PD Project Director
DPD Deputy Project Director
AD Assistant Director
SO Staff Officer
JEPIC Japanese Electric Power Information Center
POW Plan of Work

x
 CHAPTER 1

INTRODUCTION

1.1 Background
In a society, an organization is a social arrangement which pursues collective goals controlling
its own performance and has a boundary separating it from its environment. It is difficult to
achieve the faultless success by individual effort. To attain the victory from different
perceptive for individually or organizationally, all the people must struggle, work, share and
understand as well as trust together. Thus collective efforts can accomplish the mission.

In the competitive business industry, every organization finds itself in a state of continuous
risk. Risk taking is necessary for all construction organization. If one doesn’t think big, one
loses the capacity to think big. If one does not try the untried, soon the untried becomes
frightening and mysterious (Mark, 1993). The risk management of construction organization
involves indirect and direct risks. Construction projects are one-off endeavors with many
unique features such as long period, complicated processes, abominable environment,
financial intensity and dynamic organization structure and such organizational and
technological complexity generates enormous risks (Zou et al, 2007).

Since the nature of the construction industry is competitive, dynamic, and all projects are
unique, the contractors have seriously developed the effective risk management system that
they apply when dealing with risks during the life cycle of the project. The more we discover
about the nature and level of risk we face, the better we are able to prepare for it (Flanagan
and Norman, 1993). Risk events are concatenation, so one problem link to another which may
cause to another and so on. Consequently, a major damage is occurred due to a small problem.
If the organization fails to access the risk management, the organization will encounter the
various sequences of risks directly or indirectly and then it will have adverse effect.

1.2 Climate of Myanma hydropower development

Nowadays, according to Myanma Government strategies, the construction hydropower
developments in Myanmar is one of the priority for social and economic development and
which are developed under the Department of Hydropower Implementation (DHPI), a branch
of Ministry of Electric Power (1), (MOEP 1), Myanmar. Because of topography and tropical
monsoon climate, Myanmar possess abundant hydropower potential of about 39,720 MW of
which about 25,000 MW is of large scale and remaining is of medium and small scale. Due to
topography, rainfall and drainage pattern Kayin, Shan and Kayah States on tremendous
potential. The table 1.1 shows the hydropower potential of Myanmar (Greater Mekong sub-
region, Regional power trade coordination committee (RPTCC) meeting, 2008).

1
 Table 1.1: Hydropower potential in Myanmar
Under 1 MW 1 MW to 10 MW Above 10 MW Grand Total
Total Total Total Total
No. of Capacity No. of Capacity No. of Capacity No. of Capacity
Sr. No. State and Division Project .€ (MW) Project . (MW) Project . (MW) Project . (MW)
1 Kachin State 17 5.33 14 48.18 6 1852 37 1905.02
2 Chin State 11 3.48 2 2.8 1 200 14 206.28
3 Shan State 35 10.64 24 63.9 11 4161 70 4235.603
4 Sagaing State 5 0.806 3 13.3 6 2889 14 2903.106

5 Mandalay Division 3 0.65 2 6.25 9 3475 14 3481.9

6 Magway Division 1 0.1 2 11 2 93 5 104.1
7 Rakhine State 6 1.915 - - 4 804.5 10 806.415
8 Kayah State 2 0.158 - - 4 3740 6 3740.158
9 Bago Division 4 1.89 - - 7 391 11 392.89
10 Kayin State 3 0.864 1 3 4 16268 8 16271.864
11 Mon State 5 1.248 - - 2 254.5 7 255.748
Taninthayi
12 Division 9 1.706 2 19.5 2 440 13 461.206
Total 101 28.787 50 167.93 58 34568 209 34764.29
Total number of
Projects 209
Total Capacity
(MW) 34764.29

Myanmar is cooperating with four Asian neighboring countries of Thailand, China,

Bangladesh and South Korea in hydropower development, initiating major hydropower
projects in recent years (English.people.com.cn, June 6, 2007). India has joined two
Myanmar's hydropower projects under a memorandum of understanding (MoU), 2008.
(Xinhua). In addition to the projects with the Asian nations, Myanmar is currently giving
priority to implementing some six hydropower projects scattered in the country's Shan and
Kachin states to increase electricity production and solve the country's power shortage.
According to the government's National Investment Commission, the electric power sector
dominated foreign investment in Myanmar with 6.311 billion U.S. dollars as of the end of
January this year, 2007 (Xinhua).

As long as the infrastructure projects like hydropower are high investment, longtime period
and complexity, the various kinds of risk are embedding in each phrase of project such as the
budget deficit, technical risk, political risk and resource shortages, and etc. encounter during
the project life cycle. In case, the maturity of organization is one of the barriers that have
come in the way of project implementation.

1. Poor Project Management

2. Lack of Updating of Technical Development
3. Dearth of Competent Indigenous Construction Agencies
4. Lack of Adequate Experienced Construction Manpower (Technical and Managerial)
Table 1.2 illustrated the implemented and commission hydropower project of DHPI. Total
thirteen hydroelectric power projects were constructed by organization in the past. According

2
to a executive said, most implemented project were time overrun.. Alternatively, as for a
country, the frequency of developments is low and it’s necessary to promote the rate of
developments.

Table 1.2: implemented and commission hydropower project of DHPI

No. Commission Hydroelectric Installed Construction Duration

Project Capacity Period
1. Be Lu Chaung (2) 168MW 1960-1974 14
2. Kin Tar 56 MW 1981-1986 6
3. Se daw gyi 25MW 1984-1989 6
4. Be Lu Chaung (1) 28MW 1987-1992 6
5. Zaw Gyi (1) 18MW 1993-1995 3
6. Zaung Tu 20MW 1994-2000 7
7. Zaw Gyi (2) 12MW 1995-1998 4
8. Pa Ti 2MW 1996-1997 2
9. Mone 75MW 1997-2004 8
10. Paung Laung 280MW 1997-2005 9
11. Thaphanseik 30MW 1999-2002 4
12. Ye New 25MW 20__-2006
13. Kabaung 30MW 20__-2008
Due to the above reasons, it is necessary to identify the regarding risks for the continuous
projects development of organization. Risk management must be a fully integrated part of
planning and executing any operation, executing any operation routinely applied by
management, not a way of reacting when some unforeseen problem occurs (Mille and
Lessard, 2001). According to the SWOT analysis and based on the knowledge accumulated in
organizational risk research, generally the construction organization risk is ubiquitous which
arises from both internal and external sources. For instances; market, business, political risks
are external risks whereas internal risks are organization behavior, communication,
competency of human resource and so on. To a large degree, risk is tied to information and
knowledge. The better information and knowledge we have, more comfortable we are.

Nevertheless, the study only focuses on the internal key risks factors of Project Organization
then how the organization risk factors cause the problems and deficiency of construction lead
to project delay.
To understand organizational risk management clearly, the internal risk factors are identified
and analyzed through the meta-metric (Carley and Reminga, 2004). By examining the
networks of relations nodes entities in meta-metric, the major factors and their mutual
connection is explored and can assess the impact of factors in the project. Generally, these
four primary components are related to each others and play as a distinctive way for different
purposes during the life cycle of the project. The following figure 1.1 illustrates the general
features of the major elements which embedded in the construction organizations.

3
 Figure 1.1: Major elements in organization

1.3 Problem statement

An organization is an amalgamation of relationship, power, authority, roles, activities, and
communications. A truly complex framework encompasses people, knowledge, resources and
tasks/projects. When we look into it, there have different people with different social, culture
and heritage are participating in the constructed project and which is vulnerable to various
disputes. Since the organization consists of people with different social and cultural
background and different level of knowledge, the skill and expertise of people have been
unrecognized and unappreciated. Moreover, it is difficult to synchronize, integrate and
connect among different type of knowledge inside the organization. Therefore, it is necessary
for organization to set up the proper mechanism of risk management in order to have
efficiency of project.

According to initial site observation, it is obviously that the practical risk management of
organization is poor in project although organization implemented many projects. Therefore,
many risks causing construction defect are expected on the efficiency of the project. As
aforesaid, most projects of organization were delay so identification the risk factors causing
problems is being a crucial which fulfill the deficiency of project development. To great
understanding of the organizational risk management, it is required to discover the embedded
risk factors causing problem during construction stage. Continuously, it is interesting to
realize the interrelation of risks how cause construction delay. Besides once, it is required to
highlight the exposure of key risk factors to top management in order to make accurate
decision for better improvement of the constructed project.

4
1.4 Objectives of the study
As the nature of construction organization is the project-oriented organization, the structure
reforming of the project is the essential tools for the project success. To arrange the systematic
structure, the management must identify the various factors of interlocked networks of the
organization and the probability of risks occurrence in the project level then mitigate these.
The major objectives of this study are as follow.

• To identify the risk factors embedded in internal networks of project organization so

that systematic approach of the risk factors can be defined.
• To investigate the rational of organizational risk factors to project risk in hydroelectric
power project base on the approach developed.
• To purpose the recommendation for organizational risk management that is
appropriate for construction project organization.

1.5 Scope of the study

The study focuses particularly on the internal organizational risk management which is one of
the crucial key successes for construction project.
• The initial stage of this study is identifying the organizational risk factors which
influence to the constructed project.
• The respondents of the study will be the medium and senior management of state-
owned company which construct hydroelectric power project.
• Description of the impact of the organizational risk factors which cause inefficiency of
project during construction stage.
• The study scope will cover construction project oriented organization which act as a
main contractor in the infrastructure project.

5
 CHAPTER 2

LITERATURE REVIEW

2.1 Risk and Construction

Risk in a construction project is unavoidable and affects productivity, performance, quality

and budget significantly by considering the complex, dynamic and challenging nature of
construction projects, however, risk can be minimized, control, transferred, shared or insured.
Proper risk management has the potential to reduce the effects of unexpected events. Risk is
the possibility that events, their resulting impacts and dynamic interactions may run out
differently than anticipated (Miller and Lessard, 2001). Project risk is an uncertain event or
condition that, if it occurs, has a positive or a negative effect on at least one project objective.
A risk may have one or more causes and, if it occurs, one or more impacts (PMBOK Guide).
Construction’s custom is more risky than a routine, repetitive business because of long time
period, nature of complexity, high level difference of management and employees and modern
technology appliance. There are many definitions of risk that vary by specific application and
situational context. Risk is defined a state of uncertainty where some of the possibilities
involve a loss, catastrophe, or other undesirable outcome (Hubbard, 2007).Construction
projects are high-stakes games characterized by substantial irreversible commitments, skewed
reward structures in case of success and high probabilities of failure. Figure 2.1 illustrates the
probability of project success and outcome of general risks categories in construction firm.

Figure 2.1: Probable outcome of Construction Project

Source: http://www.atocrates.com/Atocrates/ProjectOffices.aspx

Combining the holistic approach of general system theory with the discipline of a work
breakdown structure as a framework, (Flanagan and Norman, 1993) suggested three way of

6
classifying risk by identifying the consequence, type and impact of risk. Risk events do not
need to have catastrophic consequences, but the commutative consequences add up and can
eventually lead to dire results. One common consequence of coping with many small risk
events is that if lead to inefficiency of operations. If risk events are not handled properly, we
may find that we are continuously redoing things that weren’t handle properly the first time.
Ultimately, this increase the cost of doing business, slow operations, and lead to customer
disaffection. The figure 2.2 presents the categories of risks in construction industry.

Figure 2.2: Characteristic of risks in construction

2.2 Organizational risk

Every organization is running within the market. There may have many numbers of projects
which generate profit for the organization. Organization risk and project risk are intrinsically
linked because the organization bears ultimately the potentially losses of the risk events.
Organization Risk such as cost, time and scope objectives that are internally inconsistent, lack
of prioritization of projects, inadequacy or interruption of funding, and resource conflicts with
other projects in the organization (PMBOK, 2000). Organizational risk, broadly defined as the
risk that the organizational configuration of a company does not support the achievement of
its strategy, therefore becomes vital to manage for companies in the post-industrial era
(Jeppesen, 2007). As mentioned previously, organizational risk are multi-dimensional and
thus need to be unbundled for clear understanding of causes, outcomes and drivers. In general,
the risk management can be divided in to number of risk categories in the constructed project.
According to Shrivastava et al., (1988); cited in Smallman, (1996),
• Human, organizational and technological (HOT) risks, which are frequently directly
responsible for crises; and
• Regulatory, infrastructural and political (RIP) risks, which act as crisis accelerators,
and so may be considered as indirect risks.
The figure 2.3 presents direct and indirect of organization risk

7
 Human Regulatory

Organization ORGANIZATION Infrastructure

Technology Political

Direct Risks Indirect Risks

Figure 2.3: Direct and Indirect of Organizational Risks

Source: Risk and organization behavior (Smallman, 1996)

The following are various direct organizational risks which link to the life cycle of the project
emerge overtime. All the risks combine together and create turbulence of project.

1. Residual risk
2. Communication risk
3. Critical employee risk
4. Personal interacting risks
5. Performance risk
6. Resource allocation risk
7. Operation failure risk
8. Supplier provisioning risk
9. Construction defect
10. Internal capability

Generally, there are three nature risks in large engineering projects; market-related risks,
completion risks and institutional risks. Major concerning about the organization is to have
expected return for the investment. In order to optimize the expected return, projects must
complete within a deadline and definable costs and standards. Construction schedules are
affected by uncertainties in weather, productivity, design, scope, site conditions, material
delivery time, equipment efficiency, etc (Flanagan and Norman, 1993). Therefore, the

8
organization needs to have mitigation for the all risks as well as uncertainty. If the
organization fails to take it, the counter sequence will come as potential losses on the
organization.

As mentioned previously, although the nature of the construction project are high risk,
companies and governments are investing in ambitious and demanding large scale
construction projects more than ever especially in developing countries. These developments
are typically valued in the hundreds-of-millions of dollars (often in the billions), with 5-10
year lifecycles, and attract a high level of public and political interest due to their size,
visibility and economic and social impact (Moavenzadeh, 2006). According to Miller et al,
2001, risk can be classified into different type of projects. For example, off-shore platform has
technical risks but low institutional risks because of far away from the public attention.
Hydroelectric-power projects are moderately difficult insofar as engineering is concerned but
they pose high social acceptability because of the environmental impact. Nuclear-power plant
project tend to be high technical risk but still higher social and institutional risks. Road and
tunnel systems are very risky when user fees are applied, social acceptability difficulties
bound. Finally, in urban transport projects are high technical risks as they involve
underground geological work so they are necessary to deal with market, social, and
institutional risk.
2.3 Managing risk in organization

Risk management is a stepwise procedure consisting of risk identification, risk classification,

risk analysis and risk response tasks (Flanagan and Norman, 1993). Organizational survival in
today’s world is achieved by pursuing opportunity within this spectrum of uncertainty and
projects are typically launched to take advantage of these opportunities. Thus, the whole point
of undertaking a project is to achieve or establish something new, to venture, to take chances,
so risk has always been an intrinsic part of project is to achieve or establish something new, to
venture, to take chances, so risk has always been an intrinsic part of project work. However, in
today’s market, with heavy competition, advanced technology and tough economic conditions,
risk taking has assumed significantly greater proportions.

No one can deny the importance of risk management on modern day projects. Different
approaches have been developed by many researchers over the years for project risks, for
example project selection, as well as micro-level risks, such as scheduling risks. Risk
management, according to the PMBOK (2003), consists of five phases starting with planning
and finishing off with monitoring. This process is repeated as cycles throughout the duration
of the project. The following figure 2.4 shows the systematic risk management procedure.

9
 Figure 2.4: Risk management process
Each of these processes is further sub-divided into sub-process with PMBOK (2000) clearly
showing the inputs, tools and techniques and outputs for each. The fore researcher did many
various investigations for the risk regarding financing, contractual, operation risk and
insurable risks. It seems to neglect how the organizational risk factors influence the project
operation during construction stage.
This paper addresses the risk factors specifically focusing in interlocked networks of project
organization. To achieve organization’s long-term objectives, clearing the residual risks is
really important. The managing pressures for enhanced risk assessment and reporting on
internal control have increased around the world. The reason—corporate accounting failures,
frauds, internal control violations, and governance failures have been seen in companies and
countries that thought they were immune to these events. These risks relate not only to
reporting and compliance; they also include strategic and operations risks.
Although risk assessment processes generally have improved, inadequate risk reporting in
some organizations has led to a failure to fully integrate identified risks into strategic and
operational decisions. When planning a merger or an acquisition, for example, how confident
can one be about the expected gains without carefully considering all potential risks, including
their assessed magnitude and probability of occurrence? Thus, decision-makers need to
understand the various organizational risks, to minimize the production cost and unproductive
time that can cause significant organizational risks. To increase productive time, managers
need good risk reporting systems to integrate risk evaluation into review of performance.
Improved organizational risk assessment and internal risk reporting is critical also for senior
management and boards of directors, who are responsible for carefully establishing and
reviewing corporate processes for identifying, assessing and managing risk. The following are
the principle of managing risk in organization.

2.3.1 Communication and Coordination

Effective communication and coordination of project team members is a vital role to achieve
efficiency of construction project. Lack of communication and coordination support heavily to
happen project failures and conflicts and to the dissatisfaction of project team members.
Industrial owner studies of failures, near failures and problems with newly constructed
projects indicate that at least 25 recent of those failures resulted from poor communication or

10
lack of coordination among the project team (Hensey, 1987 cited in quality in constructed
project, 1988).

Communication Plan

The purpose of a project communication plan is to express what, who, how and when
information will be transmitted to project stakeholders so schedules, issues and action items
can be tracked (Gray and Larson, 2008). The plan of communication is needed to be done by
the project manager and project team member since before the project implemented. It may
have some change during the implementation to have effective communication. There are four
steps of identification make satisfy the communication which are as follow (PMBOK, 2003).

1. Communication planning
2. Information distributing
3. Performance reporting
4. Manage stakeholders

Establishing a proper communication plan can have advantages of project manager to control
the flow of information instead of responding to information requests. Moreover it reduces the
ambiguous and unnecessary interruptions of project team member, and it can provide
management greater autonomy.

Coordination

Coordination of team members is occurred when multiple actors pursue goals together, they
have to do things to organize themselves that a single actor pursuing the same goals would not
have to do. It is the act of coordinating, making different people or things work together for a
goal or effect. According to the Grant and Baden-Fuller, 1995, these coordination mechanisms
include: 1) Rules and directives, 2) Sequencing – Routines, 3)Group problem solving and
decision making. The effectiveness of coordination mechanisms depends on the existence of
common knowledge, including the existence of common language and other forms of
symbolic communication (e.g. statistics), the commonality of specialized knowledge, shared
meaning, and the recognition of individual knowledge domains (Grant, 1996).

• Decentralizes design responsibility and increases the potential problems and the need
for effective coordination between the different types of systems.
The knowledge contained by the coordination tool is the most critical factor for its
effectiveness. Internal and external knowledge sharing will be positively related to
performance (Cummings, 2001).This knowledge is represented as characteristics of objects
and applied to identify several types of problems with preliminary designs and possibly give
advice regarding solutions that satisfy the multiple constraints. It also allows the tool to
identify detailed criteria that the coordinated construction specific design must satisfy. The
knowledge that the tool applies to identify and assist in resolving problems in coordination
includes design requirements, construction requirements, and knowledge related to the

11
remainder of the facility lifecycle. Although the most visible parts of coordination focus on
the geometry and functionality of the systems, perhaps the greatest value added by the process
relates to construction, operation, and maintenance of the systems. However, Coordination has
many advantages as an analytic concept here. For example, (a) it gives a powerful “analytic
grip” by immediately implying components such as goals and multiple agents, and (b) it
encompasses an intellectually coherent set of phenomena.

2.3.2 Inter-firm cooperation

Inter-firm collaboration involves explicit initiatives to enhance competitiveness through

organization cooperation. Organization may collaborate with one another and with other
organizations to integrate in learning production, design and technology deployment of shared
areas of shared needs and opportunities. Views on the role of inter-firm collaboration differ
significantly on the issue of whether such collaborations should be used to enhance existing
knowledge/capabilities of each partner (convergent development) (Beamish, 1997) or to allow
access to complementary capabilities of others while focusing on exploitation of existing
capabilities within each firm (Dyer and Singh, 1998). Uniqueness of the human asset is high
and the value to the firm is high, the firm should develop this asset internally, building a long-
term relationship based on mutual commitment (e.g. Intel engineers).

2.3.3 Cross-functional team

It is a group of employees from various functional areas of the organization – research,
engineering, marketing, finance, human resources, and operations, for example – who are all
focused on a specific objective and are responsible to work as a team to improve coordination
and innovation across divisions and resolve mutual problems (Ford and Randolph, 1992).To
face today's complex challenges, organization needs to incorporate a wide range of styles,
skills, and perspectives. Cross-functional teams are regarded as a means to manage social
collaboration and concept creation. Purpose of establishing the cross-functional team in
project organization:
• Design and develop new project;
• Chose and implement new technologies throughout organization;
• To improve the service-profit chain, and
• To control product costs
• To use the resources effectively
• To accomplish the objectives efficiently
The following figure 2.5 shows the comparison of traditional and modern functional model of
project management.

12
 Figure 2.5: Comparison of traditional and modern functional model

2.4 Practical limitation of risk Management

The process of risk Management does not aim to eliminate all risks but to identify appropriate
strategies to assist project stakeholder to manage them (Perry and Hayes, 1985). Risk
management is defined as a systematic controlling procedure for predicted risks to be faced in
an investment or project of organization. Risk management is the systematic process of
planning for, identifying, analyzing, responding to, and monitoring project risk (Project risk
management hand book, 2007). It involves processes, tools and techniques that will help the
project manager maximize the probability and results of positive event and minimize the
probability and consequences of adverse event as indicated and appropriate within the context
of risk to the overall project objectives of cost, time, scope and quality. According to Murch
(2000), several factors can influence the success of risk management as follow.

• Senior management’s expectations about risk - do they understand the value of risk
management and, if not, how can they be persuaded?
• The corporate culture and attitudes toward accountability - is there a culture that can
accept the need for accountability?
• The background, skills, and experience of the project teams - management of risks
should be an important skill for all project teams.

Project risk management is an uncertain event or condition that, if it occurs, has a positive or a
negative effect on at least one project objective. A risk may have one or more causes and, if it
occurs, one or more impacts (PMOBOK, third edition). Project risk management is most
effective when first performed early in the life of the project and is a continuing responsibility
throughout the project’s life cycle. Moreover, risk management encourages the project team to
take appropriate measures to:

13
 • Minimize adverse impacts to project scope, cost, and schedule (and quality, as a
result).
• Maximize opportunities to improve the project’s objectives with lower cost, shorter
schedules, enhanced scope and higher quality.
• Minimize management by crisis.

Alternatively, sometimes risk management is a temptation to dismiss a risk because we cannot

do anything about it anyway. There are no viable mitigation strategies for some exception
risks for instances, currency exchange rates, and terrorist attack (9/11) result in an estimated
$31.7 billion loss.

2.4.1 Risk Identification

Risk identification is the first step in the risk assessment process. Careful determination of
risk, along with analysis and control of the hazards they create results in a plan of action that
anticipates difficulties that might arise under varying conditions, and predetermines ways of
dealing with there difficulties (Miller and Lessard, 2001). The purpose is to surface risk events
as early as possible, thereby reducing or eliminating surprises. As a consequence of risk
identification, risk analysts can develop a good sense of possible source of problems (or
opportunities) that will affect their organization’s projects and operations (Frame, 2003). The
organizational risk can be identified by different way.

(1) Checklists
(2) Brainstorming sessions
(3) Issues logs
(4) Behavioral models
(5) Diagramming techniques
(6) Flowcharting project and process models
(7) Regular meeting
(8) Documentation review
(9) Interviewing
(10) SWOT analysis
(11) External audit

Risk identification is a repetitive process because new risks may become known as the project
progresses through its life cycle and previously-identified risks may drop out (Project risk
management hand book, 2nd edition). It’s important to specify the risk correctly. For instance,
a risk has a cause and if it occurs and impact on a project objective. Simple and effective risk
responses can often be developed and even implemented as soon as the risk is identified.
There are many different tools and techniques for practical risk identification as mentioned
previously. The figure 2.6 shows the simple risk identification for the project management.

14
 Figure 2.6: Risk identification process

Source: (PMBOK, Second Edition)

2.4.2 Assessing impacts of risk events and evaluation process

The risk analysis and evaluation process is the vital link between systematic identification of
risks and rational management of the significant ones. It forms the organization for decision
making
aking between different management strategies. The attempt to assay the consequences of
the occurrence of risk events is called risk impact analysis. As a matter of convenience, risk
impact analysis split into two parts qualitative and quantitative analysis.
analysi Qualitative risk
analysis is the process of assessing the impact and likelihood of identified risks (PMBOK, 2nd
edition). It includes methods for prioritizing the identified risks for further action, such as
quantitative
uantitative risk analysis or risk response planning (Project risk management hand book,
2007). The method intends to examine the impacts of risk events primarily through the
application of a logical reasoning process. By finding out the high-priority
priority risks,
risks organizations
can improve the project’s performance effectively. Moreover, it is one way to determine the
importance of addressing specific risks and guiding risk responses.

Generally, the quantitative analysis follows qualitative analysis but sometime it use together.
Due to the time and cost constraint, most researchers could not use these together. The
qualitative risk analysis is a way of numerically estimating the probability that a project will
meet its cost and time objectives. Quantitative analysis
analysis is based on a simultaneous evaluation
of the impact of all identified and quantified risks. Although there are many tools and
technique for the method, Monte Carlo simulation is common run for quantitativequan risk
analysis based on the cost complexity or high profile of the project (Project
Project risk management
hand book, 2007).

2.4.3 Risk response planning

Risk response planning is the process of developing options, and determining actions to
enhance opportunities and reduce threats to the project’s objectives ((Project risk management

15
hand book, 2007). In case, risk identification allows to determine what good and bad things
might encounter when undertaking and effort to do something. Risk impact analysis, both
qualitative and quantitative provides understanding the impact and consequences of the
occurrence of the identified good and bad things. The question; what can be done to deal with
the qualified risk events? Risk response planning is concerned with how best to handle risk
events that can arise (Frame, 2003). Project Management is the most widely found because for
failure to meet project objects and goals within today’s project management bodies of
knowledge, risk management techniques are evolving as a key tool to maximize achievement
of the stakeholder goals (Nielsen, 2006). Generally there have four approaches to mitigate the
risks in large engineering projects which those managerial strategies to cope with risks are as
follow (Miller and Lessard, 2001).

(1) Shape and mitigate

(2) Shift and allocate
(3) Influence and transform institutions and
(4) Diversify through portfolios.

Embrace residual
Diversify Portfolios
risks of ownership
of project
Broad/systemic

Influence and transform

Institutions: rules and
regulations
Type of risks

Indirect

Direct shaping
Specific to Project

Shifting of
Direct allocation and indeterminate risks
mitigation of to co-specialized
controllable project firms

Extent of control over risks

Figure 2.7: Strategies to cope with risks

Source: Miller and Lessard, 2001

16
2.5 Risks in interlocked networks of project organization

An organization can be modeled and characterized as a set of interlocked networks connecting

entities such as people, knowledge resources, tasks and groups (Carley and Reminga, 2004).
The Metamatric shows ten significant controllable networks to improve efficiency of the
organization by setting up the accurate preplanning. Risk management is a process of
harnessing information to help people make informed decision (Frame, 2003). If information
is lacking, this restricts the amount of effective risk management that can be carried out. The
collective power of team members is the critical success factor of the construction project. The
effectiveness of coordination mechanisms depends on the existence of common knowledge,
including the existence of common language and other forms of symbolic communication
(e.g. statistics), the commonality of specialized knowledge, shared meaning, and the
recognition of individual knowledge domains (Grant, 1996). Lack of coordination among the
cross-functionality which is the bottle neck of the information coordination and knowledge
sharing cause the delay in task performing and decision making. The general resource-
constrained project scheduling problem (RCPSP) arises when a set of interrelated activities
(precedence relations) is given and when activity can be performed in one of the several ways
(modes) (Chelaka L. et.al., 2000). If the required resources are not available on time, the
management could not set up the logical dependencies and resources for alternative activities
of links.

Alternatively, if the workforce could not utilize the existing resource effectively, the
performance risk will be occurred in the project. All the above factors are the priority to
consider for the efficiency of the project organization. If the organization fails to take these
risks properly, the project will move slowly while the organization has to struggle the
troubles. Finally, the unity of stakeholders will be broken and the organization will meet
unexpected situation. The following figure 2.8 is the organizational risk analyzer including
internal organizational networks.

17
 Figure 2.8: Organization risk analyzer

Source: Carley and Reminga (2004)

2.6 Internal organizational networks

Organization risk analyzer consists of ten internal organizational networks for organizational
risk management. These are 1) Social network, 2) Knowledge network, 3) Information
networks, 4) Resource network, 5) Resource usage requirement, 6) Inter-operability and Co-
usage requirements, 7) Assignment network, 8) Knowledge requirement, 9) Resource
requirement and 10) Precedence and dependencies. As mentioned in previous chapter, major
four elements play in organization as a vital role in the organization to achieve long-term
organization objectives. These can make the either potential loss or gain as well reputation of
the organization. In the top management strategies, mitigation the risks is a priority of
organization to drive safely in the modern market economy. However, controlling the critical
risk factors which is occurred due to the inter relationship among the elements is one of the
ways to mitigate the probable risks occurrence. This way enables the organization to run the
continuous projects efficiently. The following section will explain deeply about the preferable
to control the internal organizational networks in organization.

18
2.6.1 Social Network

Social network in construction organization is examined how functional department and

different interact with each other, characterizing many formal or informal connections in order
to have effective communication and coordination. Social network define as social
relationship in which the members are the individual actors within networks and ties are the
relationships between the actors. The power of social network is assumed by the individual
actors whether they are friendly or unfriendly, smart or dumb, etc because 70 to 80% learning
may be from informal communication (Davenport and Prusak, 1998). Therefore, informal
communication is priority for knowledge sharing and continuous learning for the team
members. According to the literature, upgrading knowledge networks is truly depended upon
the social relationship inside organization. Communication is the process by which the
information is exchanged and understood by two or more people, usually with the intent to
motivate and influence behavior (Daft, 2006). These networks provided ways for organization
to gather information, deter competition, and even collude in setting policies and strategies.
Alternatively, social networks allow members to organize around a person’s relationships or
interests rather that just focused on objectives. People that know each other (or want to meet
each other) will connect by a variety of common interests. These are great tools to get people
of like interest to connect to each other and share information.

Social network theory is the view that the structure of social relations in which actors are
embedded affects their behavior. These effects are assumed to operate at the individual,
organizational and even national level (Mizruchi & Marquis, 2005). People are working
together to achieve of the organization objective which become their individual objective
beyond. To achieve the individual objective, first of all, all must perform with their ultimate
effort to complete their respective specific objectives then which becomes the objective of
organization target. In order to accomplish organization mission, the project, top management
must understand the important of social network how work it is because everything is done by
people. Therefore, the basic understanding of personal communication becomes the major
concerning for the social network because of the better communication, the better cross-
functionality. Effective cross-functionality is very important for all kind of organization
because it plays as a major role of the knowledge sharing and the flowing information.
Moreover, members of cross-functional groups also have more opportunities than members of
functionally homogeneous groups because each has ties to people in different domains
(Ancona and Caldwell, 1992).
A primary advantage of the cross-functional structure is that it solves an information
processing problem (Davis & Lawrence, 1977; Galbraith, 1971). It creates lateral
communications channels not available in the classical bureaucratic form of organization. If
the cross-functionality is not working properly, the information will not flow easy and
decision making will be slow. At the same time the personal interaction will go down.
Consequently, the employee can not use their knowledge to utilize the resource which is
defined as performance risk. Besides, no good communication channels are happened due to
hierarchy structure which causes the negative effective to the governance structure. According
to Daft (2006), centralization and decentralization pertain to the hierarchical level at which

19
decision are made. In case we need to consider whether the organization structure is too much
centralize or decentralize not.
Each of the parties in construction- owner, designer, contractor (or construction manager), and
labor- has a distinct culture and way of measuring the success or failure of a construction
project (Oglesby et al., 1989).The cultural problem is one of the sources to damage the
personal communication channel. Alternatively, Ego is very influence to the personal
interaction. Sometime people frustrate because of working environment. There was a dispute
between the parties or individually in the construction project and the dispute and some other
factors were considerable mistrust between parties and lack of constructive communication
about sensitive. Krackhardt (1992) showed that a unionization attempt failed because the key
actors union members had a poor understanding of the actual friendship network. If there
doesn’t have understanding within team members, they become pessimistic to each other
sooner as a result their performance is going down because they try to compete in incorrect
way. Even a superbly designed work group will not be successful if members cannot create a
common, understanding of both the organizational context and the task itself through
communication about their work (Steines, 1972).

After all the above mentions factors combine together, various disputes will emerge in the
project and the negative result is appeared finally from the project. To avoid these situations,
all team members must have good communication channels formally or informally. Therefore,
the regular meetings and orientation must have for all specific tasks and projects which are
very important in order to improve communication and consistence information flowing
among project team members.

2.6.2 Knowledge network

It is transferring the individual knowledge from one to another in the project team by defining
as the provision or receipt of task information, knowhow, and feedback regarding a product or
procedure. The purpose of knowledge sharing is to maximize the knowledge, skills and
abilities of the employees. Knowledge sharing is necessary among group members for
executing their work effectively. Along with helping to create a common understanding of the
work being done, internal knowledge sharing can also increase the awareness of who knows
what in the group (Moreland and Myaskovsky, 2000). As work group members share what
they know with one another over the course of a project, they should become more efficient at
solving problems and allocating responsibilities for the task. However, knowledge sharing is
affected by the distance among the members of team because of the reducing time of social or
informal communication. According to Cummings (2001), geographic distribution increases,
internal knowledge sharing will decrease as well as cross-functionality decreases, internal
knowledge sharing will decrease. By the knowledge sharing, within cross-functional groups
may access information and resources that being in different geographic locations and
representing different functional areas provides.

20
The dynamic theory of organizational knowledge creation relies heavily on the idea that an
organization's primary role is the integration and explication of tacit knowledge on all
organizational levels (Levina, 1999). The main function of organizations in amplifying the
knowledge is created by individuals and crystallizing it as a part of the knowledge network of
organization. There are four types of interaction to upgrade the organization knowledge
network: Socialization (tacit to tacit), Explication (tacit to explicit), and Combination (explicit
to explicit), and Internalization (explicit to tacit).The knowledge conversion occurs through
the spiral of organizational knowledge creation, encompassing different organizational levels:
1. Sharing of tacit knowledge by a group of individuals
2. Conversion of tacit knowledge in teams into concepts and metaphors
3. Combination of team-based concepts with existing data and external knowledge
4. Articulation and development of concepts until they emerge into a concrete form
5. Dissemination of new knowledge to others within organization
Organizational Behavior and Human Decision Processes (Argote et al., 2000) have featured
knowledge sharing as a form of task communication in groups and organizations. The barrier
of knowledge sharing in organization is peoples’ boundary spanners. Generally, people do not
like to mix with different group and different nature. Therefore, they try to avoid from them as
much as they can. If they are being separately longer, their habit becomes their attitude which
make boundary to themselves from the group. The transfer of knowledge within the same
function (horizontally) is realized by boundary spanners in the organizational level. At the
same time, a vertical transfer of knowledge among different organizational functions relies on
the use of higher-order organizing principles, sharing of accounting data, and through formal
and informal structures (Levina, 1999). Current theory is that knowledge resides in people as
well as in products or procedures of the corporation, and this knowledge can be imitated,
copied, or transferred through communication (Zander and Kogut, 1995). Knowledge sharing
is not constrained to exchanges within and across employees of a company, but can occur
between employees and customers, other organizations, or firms in entirely different industries
(Hippel, 1988).

2.6.3 Information network

Information network is defined as the transferring required information from one point to
another and exchange knowledge by internalization or technology acquisition. It is
connections among types of knowledge, metal model. In general, the concept of information is
closely related to notions of constraint, communication, control, data, form, instruction,
knowledge, meaning, mental stimulus, pattern, perception, and representation. The
information of the construction project can specify feasibility studies, drawings, approvals,
schedules, specifications, standards, method of works and other documents. According to the
International Project Collaboration (White Paper), Collaboration between organizations is at
the core of successful of project delivery and depends largely upon the efficient and accurate
exchange of drawings documents and correspondence between team members.

On the other hand, as projects grow in size and complexity information coordination becomes
as critical success factor (Facility Management Magazine Australia, 2006). There is no
collaboration within organization mean without the efficient, accurate exchange and

21
management of information. In case, managing information can be significant and can
potentially support the project success. In construction period, transmitting information within
an organization based on informal contacts between managers within an enterprise and on
distributed information systems. The effect of not having a sufficient system in place for
managing information can be significant, and can potentially derail a project (International
Project Collaboration, white paper), the following table 2.1 highlights how this can impact to
the project in term of time, cost and quality.
Table 2.1: Sequence of risk due to lack of information

Source: International Project Collaboration (white paper), Aconex

Due to the risks outlined above, there is a need for large-scale international developments to
implement a third-party platform for managing information that allows collaboration between
multiple, dispersed team members.

2.6.4 Resource network

It means the continuous resource available for concurrent activities in the construction project.
It should be kept in mind that a company is an organization that supports the many projects
undertaken by the company, generally in different geographical locations and administered by
quite autonomous project managers but relying heavily on the support of the head office.
Many problems with real-life projects arise when activities require resources that are available
only in limited quantities and the demands of concurrent activities cannot be satisfied
(Woodworth and Shanahan, 1998 cited in Abeyasinghe, 2000). Not receiving the require
resource on time in order to start the altering the companion of activities is major enemy of the
construction project. Lack of require resources lead to construction delay directly. The
required for each activity may be allocated individually or may come from other activities that
share the same resources (Zhang and Li, 2003). Schedulable activities at a time are combined
based on the available resource quantities and all combinations are evaluated according to
their impacts on project duration. In case, therefore vendor competence and resource shortage
are major hindrances for the procurement to the parallel activities of the project.

22
2.6.5 Resource usage requirement

Resource usage requirement is defined combination of personal knowledge of employee and

supporting construction facilities to employees in order to optimize the existing resource
usage. Technical competency refers to the physical assets of a company such as machinery
and equipment and the extent of technical knowhow available that is necessary to undertake
specific projects. Improved information flow and flexibility of responses by team members in
a matrix can allow resources to be quickly and easily disengaged from unproductive uses and
applied to new opportunities as they are discovered (Davis Lawrence et al., 1977).
Nevertheless, utilization the resource is depended upon not only the employee competency on
specific resource usage but also communication channels and knowledge sharing within the
project members. Therefore, the project team members have good communication, and
coordination to optimize the available resource usage by preplanning. However, sometime the
nature of knowledge (high-technology appliance) and sub-quality of resources play just as the
barrier for optimizing resource usage practically.

2.6.6 Inter-operability and co-usage requirement

It means that connections among resources and substitutions to integrate the proper project
schedule during execution period. Time constrained resource scheduling in which the time
constraints are fixed and seek to resolve capacity overloads by manipulating the timing of
activities within their total float, and without affecting the initial project completion time
(Matthews, 1994). Resource scheduling problem is depended upon the type of construction
project. For example, hydropower project located in the remote area so geological barrier is
the main constraint of resource allocation such as mobilization of heavy equipments, resource
shortage for high technology equipment such as tunneling machine. Therefore, preplanning
resource allocation is necessary to prevent the schedule delay.

2.6.7 Assignment Network

Assignment network is examined assigning tasks to employees inside project and transferring
employees within according to the job requirement. There are many factors influence the job
assigning in the construction project such as insufficient workforce, job satisfaction,
functional workload. Different attitude and behavior make people not to satisfy their new
place. Moreover, perceptions of work situations and environments which hinder desire out
comes will lead to dissatisfaction with certain aspect of the job (Judge et al., 1995). On the
other hand, assigning the incompetency of critical employee in the project make conflict in
project due to lack of communication and coordination.

2.6.8 Knowledge Requirements

The knowledge requirements mean the combination of individual competency and supporting
relevant document in task performing. The knowledge for the task means shop drawings,
schedules, specifications, method of works, standards, procedures and other relevant
documents for the constructive design. Providing the right information to the right people at

23
the right time, and helping people create knowledge and share and act upon information in
ways will measurably improve the performance of organization itself and its partners.
Frequent information exchange or task communication seems crucial for getting work
accomplished in many groups and helping them performs well (Allen et al., 1977).

2.6.9 Resource Requirements

Resource requirements means organization supporting the require resource to project to

perform the task effectively. Construction managers need to develop activities schedule (Plan
of Work) for directing and controlling resources of workers, machines, and materials in a
coordinated and time-efficient fashion in order to deliver a project within the limited funding
and time available (Halpin and Woodhead, 1998, cited in Lu et al., 2007). Personal
compulsory skill of each employee (watch over resource and knowledge) which is required to
look over the demand of next task and systematic report to the management is important for
the resource scheduling.

2.6.10 Precedence and dependencies

It is defined as generation, verification and modification of construction project schedule

networks in PERT/CPM (Project Evaluation and Review Technique/Critical Path Method)
chart in order to complete within estimated project period. Conventional critical path method
(CPM) and program evaluation and review technique (PERT) scheduling procedures start with
an assumption of unlimited availability of resources for each project activity (Cooke B and
Williams P, 1998). In the real-life project, resource, technology and information are the
principle constraints of the task precedence and dependencies. Logical dependencies and
resources (e.g., workforce, construction materials and equipments) required when scheduling
activities in a construction project. Resource-constrained project scheduling accepts the
priority of fixed resource availability and permit not only sequencing and float time to be
altered (Matthews, 1994). Generally, this kind of problem occurs when a set of interrelated
activities (precedence relations) is given and when each activity can be performed in one of
the several ways. The early and late dates calculated with the critical path algorithm are based
on the duration of the activities in the project and the relationships or technologies constraints
between them (Chelaka L et al., 2000). It is noteworthy that the scheduling logic of
deterministic CPM which is necessary to define by activity times, precedence relationships,
resource requirements and availabilities.

2.7 Summary

System accident is born from the confusion and interrelationships inherent in complex
organizations and mechanism. They have been termed “normal accidents” because they are
the unavoidable that comes with running improper systems. Most of the construction project
delay because of lack of communication and coordination inside the project organization.
Cross-functional teams are regarded as a means to manage social collaboration and concept

24
creation. Since different people come from the unlike background, cultural and countries
make distinct decisions which cause various disputes in social network. If the conflict cannot
solve in the initial stage, it will become the critical risks of the organization. Frequently,
consequence of dealing with many small risk events leads to inefficiency of project. If there
has no effective action taken in order to mitigate the risk events, we may find that we are
continuously redoing things that increase the cost of doing business, slow operations, and lead
to customer disaffection which threat to efficiency of the project. As a result, the organization
face the commutative consequences add up and can ultimately lead to terrible results.
Therefore, top management has to concern about the organizational risk factors which make
inefficiency of project.

25
 CHAPTER 3

RESEARCH METHODOLOGY

3.1 Introduction

The research methodology is the guideline which tells a detailed plan or explanation in setting
standards for collecting and analyzed in systematic way. It is important to comprehend
because the methodology framework which is the backbone of the research studies. Therefore,
it has to be explained what appropriate method will be used and why this method is chosen in
order to obtain the research objectives. Furthermore, it prevents the prospected and unforeseen
problems during the study period. This Chapter shows all of the thesis process in identifying
the key risks. However there are three main implementation steps suggested by Ashley and
Bonner (1987). It includes three main parts: 1) Information gathering, 2) Organizational risk
identification, 3) Qualitative impact assessment.

With respect to aforesaid implementation steps, the methodology of thesis is relied on an

information gathering composing of reading from relevant literature, interviewing and
questionnaire will be discussed. However, the concept of risk identification and analysis will
be sued to obtain subjective information. Influence diagram and knowledge map technique
will be used as research approach to communicate knowledge among people and to gather or
coordinate the fragment pieces of information that are relevant to the event in question.

3.1.1 Selection of Research Method

According to Yin (1994), the selection of research strategy depends on three condition consist
of (a) the type of research question posed, (b) the extent of control an investigator as over
actual behavioral events, and (c) the degree of focus on contemporary as opposed to historical
events. In order to obtain the research objectives, there has five major research strategies in
the social sciences are experiments, surveys, archival, analysis, histories, and case studies. The
strategy chosen to conduct the research is multiple cases study for it is answering “what” and
“how” research question, no control is required over behavioral events and focusing on
contemporary events. The evidence from multiple cases is often considered more compelling
and the overall study is therefore regarded as being more robust (Herriott and Firestone, 1983,
cited in Yin, 2004). This study involves the solicitation of information from the individuals
using questionnaires and interview (structure/unstructured). Thus it is categorized as self
report research (Gay, 1990). Besides, this study requires the investigation of the current risk
events, rational of risk factor and events, practical limitation of risk management so that case
study is the most suitable method to carry out. This strategy gratifies constraints of time, cost
and requirements of in depth understanding of the problems. A key strength of the case study
method involves using multiple sources and techniques in the data gathering process (Soy,
1997). Furthermore, a case study is an exploration of a “bounded system” or a case over time

26
through detailed, in-depth data collection involving multiple sources of information rich in
context (Creswell, 1998).

3.1.2 Research Approach

Research approach is a modeling process. It is the fundamental process in this study. The
approach of research consists of six stages of cognitive knowledge. Each part has its own
value during the process. The purpose of it is to fill gaps between what is currently and what
could be in the future by changing the heuristics over time through various types of
knowledge that can be acquired: knowledge, comprehension, application, analysis, synthesis,
and evaluation (Arciszewski and Rossman, 1992). Research approach is needed to set up a
better job in solving problems. Following research approach will enable researcher to
experience specific problem solving technique. It allows researcher to carry out the study from
the wide perspective down into detail aspect.
The first three processes are proposed to achieve descriptive knowledge which is about
identifying general (conscious) heuristics. It helps the researcher to be familiar with the
overall general information regarding risk events particularly in hydroelectric power
implementation. Analysis process allows the researcher to attain in depth facts and
information of the elements in rational of risk factors and their impact hydroelectric power
project. The knowledge being acquired here is procedural knowledge which is about
identifying routine procedures/ tasks. Structured and unstructured interview, process tracing
and simulations are suggested to gain this kind of knowledge.
Synthesis and Evaluation processes make use the gathered information, organizing the facts
and components in the previous processes to be able to combine all the elements and produce
explanations to acquaint the phenomena and to construct judgments based on standards
application. Moreover, comments and recommendations will be made. By following these two
respective processes, the researcher is able to gather semantic and episodic knowledge.
Semantic knowledge is to identify concatenation of risk events. Task analysis and process
tracing are suggested to gain this knowledge. Research approach is the effective way to
achieve the objectives of the study. It allows systematic approach in order to ensure smooth
process, indicate the important aspects, and avoid missing critical data. Additionally, the
overall processes support the development of the appropriate recommendations for
improvement for each phenomenon revealed. Figure 3.1 shows the process of research for the
study.

27
 Site Observation Literature Review

Knowledge
Organizational Risk
Comprehension
Description
Knowledge

Management

Professional Interview
Application
Verified factors and Framework
for
questionnaire design
Practitioner
s interviews

Case Study
Procedural Practice in real-life
Analysis Hydropower Projects
Knowledge
(Myanmar)

Semantic and Synthesis Information Comparison

Episodic
Knowledge
Evaluation Case Study Results

Research Objectives

Figure 3.1: Research approach

3.1.3 Research Methodology Framework

This study is consisted of four main parts: 1) factors identification, 2) data collection, 3) data
analysis and 5) conclusion and recommendation. The first part is the factors identification
which is being carried out by literature reviews for preliminary factors and verification.
Highly concentrated literature review provides the conceptual approach for organizational risk
factors in general and the operational elements as the initial risk factors. Verification includes
two integral parts: application and analysis. Project organization has own characteristics
which distinguish it from parent organization. The knowledge, facts, and information found in
literature review then have to be applied into the specific hydroelectric power project. The
identification approach and initial risk factors are then being edited and added to adjust to the
characteristics of hydropower project. However, the edited risk factors and framework has to
be confirmed against the professionals.
In this study, case study strategy as one of the qualitative research techniques is utilized to
gain the data. Therefore, the first step is to design the question for case study based on the
approach edited in the previous process. Utilization of edited approach and factors to design
the questions is found to give specific and effective questions in order to gather the require
information precisely. The interviews are conducted in 3 places which are Heard Quarter of
Department of Hydropower Implementation (DHPI), Yeywa HPP (Construction Division-2)

28
and Khun and Phyu HPP (Construction Division-3). Criteria for judging the quality of
research design are as followed:
1. Construct validity: determining correct operational measures for the concept being
studied by using the evidence from medium to top management people of two
hydroelectric power projects regarding organizational risk factors during construction
stages.
2. Internal validity by explaining the analysis of data collected from both projects by
applying illustrated research approach; what are the organizational risk factors and
how it influencing the efficiency of project.
3. External validity: The research design is doing for the same nature of the projects such
as hydroelectric power project which are located in the same country and participants
in projects are local, European and Chinese so the expected result will appear from
both projects in generally.
4. Reliability: The similar results will be come out if the later investigator followed the
same procedures and conducted the same case study all over again due to the
appropriate research approach.
Data analysis from the case study enables the researcher to gain in-depth understanding of
influencing factors and interrelationship of risk factors included in internal organizational
networks. Each answer for the question between two specific hydroelectric power projects in
the case study protocol is examined and compared by pattern matching technique. Then the
exploration of overall risk factors is carried by using cross-case synthesis technique. The
result is then being thoroughly incorporated to achieve the objectives of the study. The
conclusion and recommendation will mention in the final stage which is then given against the
dilemma and phenomena found from case studies. The methodology process of the study is in
Figure 3.2.

29
Figure 3.2: Research Methodology Framework

30
3.2 Risk Factors identification

Improper arrangement of the organization’s structure makes various series of problems

affecting on the project-organization. The Meta-Matrix, organization risk analyzer (Carley and
Reminga, 2004) is a theoretical framework for representing the various network relations of
an organizational system. By using Meta-Matrix as an analyzer can find out the organizational
risk factors affecting on the project-organization in term of risks. Moreover, this framework is
important to this study because it allows for the definition key risk factors and analysis of the
rationale organizational factors to project risks of the study. In the Meta-Matrix framework,
organizations are defined by a set of networks under four classifications: personnel,
knowledge, resource and tasks/projects. The following figure 3.3 shows the organization risk
analyzer which include internal organizational networks.

Figure 3.3: Organization risk analyzer

Source: Carley and Reminga (2004)

31
3.2.1 Interviewing and verification of initial risk factors

Meta-Matrix network analysis can capture higher levels of complexity and provide specific
reason of the problem at different levels of analysis in organization. Expanding the analysis to
higher organizational levels will provide increasing benefit to existing. At this step, an
interviewing is suggested to obtain subjective factors. This process involves an investigation
with all possible potential sources of project risks and their consequences. In addition, their
causal interrelationships between each different risk are discussed. The interviewing material
includes the characteristics of practical risk management and methodology for collecting data.
Objectives of interviewing are to identify the possible risk factors and sub-factors and
practical risk management process of DHPI. Major input risk factors are come out from the
literature review and professional interviews.

Verification of risks factors

In this step, selected professional’s advice for the required studies materials identifies major
gaps in the knowledge base and the simple questionnaire. Then the practical risk factors are
judged in hydropower project and the organizational risk management process will be
highlight. The objectives of factors validation include the following (Badiru, 1992 cited in
Puthamont, 2006): completeness, efficiency, validity, consistency, clarity. This judgment is
based on whether all sub-areas have been included, and in the correct proportions. The real
practices, phenomena, and important factors are the complementary result from the
verification process.

Professional interview
Since professional interviews are important role on determining the objective achievement of
the research, theoretically there are several criteria to be fulfilled by the professionals to be
selected. The interviewing is especially for the proper practice of factors applying to the real
project. The structured interview was being for the initial factors identification for the research
design and questionnaire are discussed with the experienced before going to practice in the
cases study.
Selected experienced professional is an Assistant Supreme Engineer (Deputy Project Director)
of Planning and Work Department in order to make sure the organizational risk factors. The
selected professional has 20 years experience in planning and works of DHPI hydroelectric
power projects. The interviewee is closer friendship with the researcher and eager interesting
in the current study. In the interviews, the researcher discuss about subjective factors related
to organizational factors which obtained from the literature review, books and other sources.
Finalization the framework of study is made sure by the Project Director of Con (A) after the
second interview based on the rational understanding of subjected organizational factors of
project organization. The figure 3.4 presents the process of verification risk factors for
questionnaire in order to practice in project.

32
 Figure 3.4:: Verification risk factors and questionnaire process

The verification risk factors in project organization is important for the study because the
rationale of organizational risk factor to project risk is necessary to find out for the cases study
interviews and checklist in order to gather the concrete resul
results
ts of the analysis. Therefore, first
practitioner of verification initial
in risk factors was from organizational level and then 2nd
practitioners of interviews
views for verified questionnaires based on verified risk factors was
project director of construction division (2). The following figure 3.5 shows the verified
organizational risk factors for the interview and checklist.

33
 Figure 3.5: Verified organizational risk factors
3.3 Data Collection

As most qualitative case studies, this study combined different data collection methods, such
as archives, interviews, questionnaires, and direct observations at formal and informal
meetings (Eisenhardt 1989). The primary source of information was interviews with
individual interviewees from two construction divisions (3 projects). Selected interviewees
were selected by randomly for personal interviews from different part of project such as Dam
portion, tunneling, powerhouse construction and electromechanical portion. The data is
gathered through in depth question following the factors and their relationship identified in the
previous process to ensure complete information and details as well as point out the necessary
and critical factors. There are many steps to collect data, as follows:

1. Selecting the projects by using the researcher’s network. Since in depth question
interview regarding practical risk management for case studies is very sensitive
2. The researcher applies to the top management for the permission of making interview
with employees and site observations in order to avoid the unforeseen barriers in the
projects.
3. Contacting the selected respondents either by telephone or official mail to make
further appointment as well on site.
4. Staying on sites and conducting the personal interviews and discussions.

34
3.3.1 Checklist Design

There are two kind of checklist for comprehend practical risk management of organization and
for identify the possible risks considered by professionals from the initial interviewing. What
is needed now is to determine their degree of impact to the efficiency of project qualitatively
asking in checklist which risk factors already identified are most important in hydropower
projects by practicing in real cases. There are 2 types of question include in interview with
practitioner in the project. These are
1. Why is the risk happened in the project regarding organization?
2. How does it impact to the project efficiency which leads to delay?

3.3.2 Pilot test

It is an initial run of a study (e.g. an experiment, survey, or interview) for the purpose of
verifying that the test itself is well-formulated. The pilot test is conducted for checking the
degree of accuracy and reliability of gathered information through interviews, interviewing
skills and contents of questionnaire to make possible corrections and preparation for personal
interviews. Two pilot tests did to an assistant supreme engineer and a staff officer in order to
check the degree of accuracy and reliability of gathered information through interviews,
interviewing skills and contents of questionnaire to make possible corrections and preparation
for personal interview before practiced in real cases study.

3.3.3 Project selection for case studies

The selected hydropower projects are undertaken by DHP those which are in Yeywa, 790MW
(Mandalay Division) and Kun (60 MW) and Phyu (40 MW), Bago Division in Myanmar.
Yeywa project is under construction division (2) and the rest projects are under construction
division (3). Although the size of projects is quite different, the characteristic is similar to each
other due to the kind of hydroelectric power project. Furthermore, they are similarities to
technology appliance, climate and participants to ensure similar problem encountered.

3.3.4 Interview Plan

Data collection is carried out in three place 1) Headquarter of DHPI, 2) Hydroelectric Power
Project, Construction Division (2) and 3) Kun and Phyu Hydroelectric Power Projects,
Construction Division (3) of DHPI. The positions of interviewees are from medium to top
management of projects. Director General (DG), Deputy Director General (DDG), Project
Directors (PDs), Assistant Directors (ADs), Staff Officers (SOs).
Firstly, top management interviews with DG and DDG were carried out at the head office of
DHP in Nay Pyi Taw. Then, the researcher goes to the construction sites to interview the
respondents about practical risk management and investigate the key risk factors of
organization by questionnaire. Furthermore, related document of the risk management are
studied in order to find out the extra information regarding organizational risk management.
The researcher selected all interviewees randomly to avoid the bias of one person in the
project.

35
Total 20 interviews is doing during data collection among them; 16 structured interviews
through 6 functional managers and 10 staff officers from both construction divisions in order
to realize the practical organizational risk management and discover the crucial risk factors in
the project organization. Moreover, the researcher make unstructured interviews with 2 top
managements, a representative of consultant (CPE) and a subcontractor (CGGC) in order to
know the perceptive of top management on risk management in head quarter. The following
table 3.1 illustrates the interviewed lists of cases study during data collection.

Table 3.1: Cases study interviewees list

Unstructured interviews Structured interview

Top Subcontr Assistant Staff
Consultant
Management actor Director Officer
Head Quarter 2 1 1
Construction Division (A) 4 6
Construction Division (B) 2 4
2 1 1 9 7
Total 4 16
3.4 Data Analysis and validation

The description will be performed in word, bar chart, photos, and tabular. Qualitative analysis
allows the in-depth thinking in order to achieve the objectives of this study.
Five stages in organizational risks analysis are included to comprehend the rational of
organizational risk factors and project risk in this chapter. The cases study evidences are
examined by relying on theoretical proposition and the analytical thinking is carried out to
investigate the key risk factors of organization and their consequence in the project. Firstly,
identification of internal networks of organization and organizational risk factors is developed
by combining the knowledge of literature reviews and interview of practitioners. Then,
descriptive analysis is carried out in order to see general feature of risk management in the
project. Next, the analysis of differences risk factors which make opposite results in both
cases study is explained by using pattern matching technique. The similarities and differences
are then examined in order to find out the conformance of critical organizational risk factors
practices in hydropower project.

After that, verification of overall risk factors is discovered by doing cross-case synthesis
technique to cover all organizational risks which cause inefficiency of project. Moreover, the
combination of analysis results can highlight the priority of risks that organization is necessary
to mitigate. Causal link between project risks and the project outcomes are logically
developed by this analysis. Finally, based on the discovered phenomena, the logic model of
organizational risk management is activated in order to practice in the real project. This is the
most suitable analysis procedure for this kind of research study why the reasons of opposite
results is having under organization. Moreover, it is done to have deeply understanding into

36
the risk management and the different contributing organizational risk factors which make
projects delay.

Interview data was constantly compared and triangulated with other interviews, real time
observation and written archival evidence. Based on the data obtained from assessed
questionnaire, the obvious risk factors are developed in qualitative analysis. Moreover, by
analyzing the gathered information with the factors identification process which deeply
involving theoretical reviews; the researcher can investigate the organizational risk factors and
management practice in DHPI. The following figure 3.6 show the analysis process of cases
study.

.
Figure 3.6: Data analysis procedure

37
3.5 Case Study Report

Multiple-case report is the selected format for the study and it includes multiple narratives
which are from medium to top management of the project. The composition of report includes
following five parts; firstly, the introduction of report is the description of organizational risk
management and risk factors for better comprehension of the gap between organizational risk
management. Secondly, the overview practical risk management in DHPI is presented.
Thirdly, part of report is the description of differences risk factors in both construction
divisions and examination of results is highlighted. Fourthly, the cross-case analysis and
results will be contained in the body of the report. In this step, top ranks of risk factors are
explored then discussion of each risk factor will be follow. The report finalization is the
conclusion and recommendation for improvement of efficiency of project by managing proper
risk management. Therefore, the report will be adequate for the later research regarding
organizational risk management of construction project organization. Finally, the algorithm of
the research study is addressed which give readers to conclude without doubt about the
research study.

38
 CHAPTER 4

CASES STUDY ANALYSIS

4.1 Organizational risk management

Organizational risk management can be classified into ten networks according to Meta Matrix
analysis (Carley and Reminga, 2004). There are ten networks include in Meta matrix which
are social network, knowledge network, information network, resource network, resource
usage requirement, inter-operability and co-usage requirement, assignment network,
knowledge requirements, resource requirements and Precedence and dependencies. Each
network is influenced by different organization risk factors. The following table 4.1 explains
about the internal network of construction organization in Meta Matrix (organizational risk
analyzer).

Table 4.1: Internal network of construction organization

Internal Organizational
Network
Social Network
Knowledge network
Information network
Resource network
Resource usage requirement
Inter-operability and co-usage
requirement
Assignment Network
Knowledge Requirements
Resource Requirements
Operational Definition
Social network in construction organization is examined
how functional department and different interact with
each other, characterizing many formal or informal
connections in order to have effective communication and
coordination
It is transferring the individual knowledge from one to
another in the project team by defining as the provision or
receipt of task information, knowhow, and feedback
regarding a product or procedure
Information network is defined as the transferring
required information from one point to another and
exchange knowledge by internalization or technology
acquisition from other parties
Continuous resource available for concurrent activities in
the construction period
Combination of personal knowledge of employee and
supporting construction facilities in order to optimize the
existing resource usage
Connections among resources and substitutions to
integrate the proper project schedule during execution
Assigning tasks to employees inside project and
transferring employees from one project to another project
according to the job requirement
Combination of individual competency and supporting
relevant document in task performing
Supporting the require resource to project to perform the
task effectively

39
Precedence and dependencies Generation, verification and modification of construction
project schedule networks in PERT/CPM

4.1.1 Risks in internal organizational networks

According to the Meta Matrix Analyzer, different networks are influenced by the different
organizational risk factors which cause directly or indirectly impact to the construction
schedule. To better understanding of network analyzer, the definition of risk factors are
developed by the combination of literature review, web based knowledge creation and
practical interviews with practitioner from two construction divisions in Myanmar. The
explanation of cases study profiles is followed in the next part. The following table 4.2
examines the factors which influence to each network of organization.

Table 4.2: Risk factors influencing in network of organization

Factors influencing the

Definition of risk factors
schedule of project
Organization structure is designed complexly
Complex organization
which cause difficulty to employees to
structure
communicate each others
Provide empowerment to the employee in which
Delegation
Social Network

authority and responsibility are balance

Lack of influential power
Mistrust between parties
Culture difference
Cross-functional team
Knowledge Network
Senior position takes care to lower positions such
as motivation, job satisfaction, and personal
development
Lack of constructive communication between
different parties
Different experience and culture of project team
members which cause different attitude and
assessment in task performing.
Organizing special team from different functions
of organization to improve coordination and

resolve mutual problems.

Regular meeting
Knowledge Sharing
Discussing about needs and requests among
project team members for integrating personal
communication and relationship
Sharing the experience and knowledge within
project team members to solve the problems such
as discrepancies of drawings, specifications and
construction defect

40

Inaccurate information
Information Network
Lack of coordination within
parties
Lack of functional
coordination
Incorrect resource allocation
Resource Network
Sub-quality resource
Budget delay
Incompetency of suppliers
Lack of skilled workforce
Resource usage
requirement
Technical competency
Inter-operability and
Time constraint
Requirement
C0-usage
Geological barrier
Resource shortage (out of
stock)
Insufficient human resource
Assignment Network
Different attitude and
assessment
Dissatisfaction on job assigning
Improper arrangement of
tasks
Organization providing inaccurate information to
perform task such as shop drawings, improper
schedule, specifications, method statement
Lack of coordination between different parties
for technical problem such as defective design,
geo-technical, under-over design
Information coordination within different
departments in organization for preplanning
activities schedule
Improper arraignment of resource allocation to
project
Construction engineers receive low quality
resource which cause quality lose of construction
delay accessibility of budget payment to
employees for purchasing the cost of workforce
and compulsory construction materials
Supplier import low quality resources out of
standard
Personal competency of workforce is difficult to
optimize the existing resource.
Physical asset of organization and the extent of
knowledge to optimize the resource usage
Tough to make schedule for the demand of
resources for activities under fixed time
National infrastructure make barrier to transport
heavy equipments, machinery and construction
materials.
Resources totally finished and can not assess
from the market
Limited quantity of employees for managerial
and technical available to perform the task in
project
Different attitude and assessment of critical task
performing among project team members
Employee do not satisfy on their job assignment
in particular task performing
Senior management make improper arrangement
of tasks to different department
41
 Organization provide lately the required
requirement
Knowledge

information such as design approval, shop

Delay information
drawing, schedule approval, specification and
change of requests
Delay accessibility of key materials such as steel,
Requirement

Delay key resources

Resource

cement, explosives, fuel

Project receive late major equipment in order to
Delay major equipment
perform the critical activities
Precedence and

Limited quantities resources receiving for the

Dependencies

Resources constraint
demand of concurrent activities

Duration of activities depend on the planning

Technology constraints technology as well as project management
technology such as Primavera
Table 4.2: Risks factors influencing in network in organization

4.2 Organization background

Department of Hydropower Implementation (DHPI) is a state-owned company and it acts as a

main-contractor of MOEP (1) in all hydroelectric projects. At this moment, seven construction
divisions are implementing under DHPI. The research study was conducted in two of it,
construction division (2), Yeywa Hydroelectric Power Project (790 MW) and construction
division (3), Kun (60 MW) and Phyu (40 MW) Hydroelectric Power Projects in Myanmar.
Table 4.3 shows the profile of organization, DHPI.

Table 4.3: Profile of Organization, DHPI

Organization Department of Hydropower Implementation (DHPI)

Established Year 1997
Specialization Hydroelectric Power Construction
Type State-owned Company
Main Experience Hydroelectric Construction
Current Projects 7
Affiliated by Ministry of Electric Power (1)

4.2.1 Construction division (A), Yeywa Hydroelectric Power Project, DHPI

Yeywa Hydroelectric Power Project is located thirty-two miles far away from south east of
Mandalay, central region of Myanmar. Although prefeasibility studied of projects was started
since 1920-1960, the actual implementation of projects was started in 2001. In order to have
the efficiency of execution, MOEP (1) had contract agreement with COLENCO POWER
ENGINEERING Co., LTD (SWITZERLAND) for design and general technical specification

42
add in Tender documents in 2002. The following table 4.4 illustrates the profile of
construction division (A), Con (A), Yeywa Hydroelectric Power Project.

Table 4.4: Profile of Construction Division (A), Yeywa Hydroelectric Power Project

1. Name Yeywa Hydroelectric Power Project

2. Location Southeast of 32 miles far away from Mandalay City
3. Dam Type Roller Compacted Concrete Dam
4. Install Capacity 790 MW (4 x 197.5 MW)
5. Project Period 2001-2010
6. Completed (%) 70 (%), Nov 2008
7. Contractor Department of Hydropower Implementation, DHPI

•Construction Division (A)- Yeywa

Hydroelectric Power Project

•Construction Division (B)- Kun and

Phyu Hydroelectric Power Projects

Figure 4.1: Locations of cases study

43
4.2.2 Construction (B), Kun and Phyu Hydroelectric Power Projects

Kun and Phyu Projects are constructed by Department of Hydropower Implementation in construction
division (B). Both projects are 7 miles far from each others and located at the delta region of Sit Town
River, in the middle region of the country. Although the prefeasibility study was carried out 1964, the
construction was started from 2001 (Kun project) and 2004 (Phyu project). Initial construction design
of Kun and Phyu Projects were belonged to NEPS (local consultant) but Kansai Electric Power
Company (Japan) act as a consultant for the requirement of construction design from 2005 but
Memorandum of Understanding was finished in July 2008. The following table 4.5 illustrates the
profiles of Con (B-1), Kun and Con (B-2),Phyu Hydroelectric Power Project under construction
division (B).

Table 4.5: Profiles of Kun and Phyu Hydroelectric Power Projects, Construction Division (B)

1. Name Kun Hydroelectric Power Project

2. Location Southwest of 9miles far away from Phyu City, Bago Division
3. Dam Type Rock Fill Dam
4. Install Capacity 60 MW (2x 30 MW)
5. Project Period 2003-2010
6. Completed (%) 70 (%), Dec 2008
7. Contractor Department of Hydropower Implementation, DHPI

1. Name Phyu Hydroelectric Power Project

2. Location West of 7 miles far away from Phyu City, Bago Divsion
3. Dam Type Earth Dam
4. Install Capacity 40 MW (2 x 20 MW)
5. Project Period 2004-2010
6. Completed (%) 44.15 %, Dec 2008
7. Contractor Department of Hydropower Implementation, DHPI

4.2.3 Cases study overview

The analytic data collected from 16 structured interviews through 6 functional managers and
10 staff officers from both construction divisions in order to realize the practical
organizational risk management and discover the crucial risk factors in the project
organization. Moreover, the researcher did unstructured interviews with 2 top managements, a
representative of consultant (CPE) and a subcontractor (CGGC) in order to know the
perceptive of top management on risk management in headquarter of DHPI. Then 16
structured interviews were conducted with 6 assistant directors and 10 staff officers in Con
(A) and (B). Developed risk factor identified checklist was used during the structured
interviews in order to identify the key organizational risk factors.

44
4.3 Practical risk management in organization

Overview analysis of risk management in organization is started initially in this chapter in

order to realize the perceptive of top management and awareness of people on it. The initial
part of checklist (R-1 to R12) intends to investigate the perceptive of employees on practical
risk management in project. By investigating the overview risk factors of organization make
better comprehension of the gap between the theoretical and practical risk management of
organization. The following table 4.6 shows the results of checklist of overview practical risk
management in organization.

Table 4.6: Practical overview of risk management checklist in project organization

Code. Checklists Yes No

R1 Does your organization have a policy or application standard for risk

management in this project? 31 69
Have you ever had training for the awareness of the systematic risk
R2
management? 13 88
R3 Do you often guide and train your subordinate about risk assessment? 88 13

R4 Do you think that the risks were properly managed in your

organization? 75 25
Does the risks management system was properly updated by
R5
organization? 38 63
Does the organization have periodically orientation for assessing
R6
risks and evaluation the events to mitigate the need? 38 63
Does your organization have systematic experience feedback loop for
R7
upgrading data base? 88 13
Does the project have specific team/department to certify the quality
R8
of resource from suppliers? 100 0

R9 Does the management concern for the proper organizational risk

management in this project? 75 25

R10 Do you know that organizational risk management can reduce

potential losses and gain social benefit of the organization? 100 0
R11 Do you believe that organizational risk management can improve
project performance? 94 6
Does the organization have specific department to check the
R12
deficiency of contract agreement? 100 0
R13 Do you satisfy your status in your organization/project? 94 6
Does the empowerment is sufficient for you to perform task
R14
effectively? 75 25

45
 Did you use to have informal meeting with another
R15
employee/subordinate for social interest? 81 19
Does organization support efficient equipment and material to
R16
perform the task effectively? 56 44

R17 Did you receive the budget on time for payment to the subordinates
and repair equipment? 38 63
Does organization has Collaboration with other project organization
R18 to enhance the organization capability such as training, learning
production, design technology deployment? 81 19
Do you think the organization should set up the proper risk
R19 management system to carry out the long-term strategies of the
organization? 81 19
Yes% = % of respondents’ agreement

From the results display in practical risk management auditing checklist shown in table 4.1
presented that 69% of employees said that organization does not have a policy of risk
management. It is significantly that 88% of employees in this organization did not receive
any training for the awareness of the risk management so they do not even know what the risk
management is. Although the construction engineers did not receive the risk management
training, 88% of them guide their subordinates how to avoid risk based on their experience
and background because they know it is necessary to avoid problems in task performing.
According to top management said, the organization does not have specific risk management
program for the awareness of it so people in organization assess risks depended upon their
experience. It indicates that organization has higher risk in the project execution.

A representative of consultant argue that the unusual results of 75%, risks were properly
manage because they do not consider the indirect cost of risk events and the impact of it.
However, 63% of interviews said that there has lack of periodically orientation or evaluation
of risks in the organization which confirm the perceptive of Consultant. As a result,
organization is suffered the retention of risks which affect the project schedule indirectly
either. One of the major organizational risks is delay budget with 63% among overview
organizational risk factors. This problem is happening because of practicing strongly central
cost control system and limitation of authority in empowerment to employees. The decision
making process is too long in hierarchy structure of organization. Organization has higher
restriction of authority for the employee. If employees want to use over authority due to extra
cost of activities, they have to request decision from senior position and if the require amount
of cost is not covered by the authority of project director, the application will go to the top
management of the organization. The application process takes minimum two week to one
month. Therefore, it causes delay budget which makes difficult for construction engineers to
handle the skillful workforce and purchasing for some compulsory construction materials. The
figure 4.2 shows the limitation of authority and decision making process of over budget usage.

46
 Role in Head Office Role in Project Responsibility Authority
Project level Organization

Director General
al level

Deputy Director
General
•Planning of scope
Supreme •Schedule approve
Director •Director,
Engineer •Design approve
(3,000,000kyats)
•Design variation
Assistant •Needs •Deputy
Supreme •Negotiation with different parties Director,
Deputy Director Engineer
•Change of requests
(1,000,000kyats)
•Procurement

•Plan of Work (Time, Scope, Resource)

•Managing project team •Assistant
Functional

Executive •Financial control Director

Assistant Director
level

Engineer •Method of works (500,000kyats)

•Dispute resolutions within project
teams

•Local Sub contractors payment control

Operation

•Task Performing •Staff Officer

Assistant
level

•Construction Engineering
Staff Officer •Progress report
(100,000kyats)
Engineer •Feedback

Exchange rate :1 USD = 1050kyats (17,03.09)

Figure 4.2: Limitation of accountability and decision making process

According to interviewed results from practitioners, the entire respondents accept that risk
management can reduce potential losses and gain social benefit whereas 94% of them believe
that it can improve the project performance. In addition, 81% employees want organization to
set up proper risk management to carry out the long-term strategies of the organization.
Therefore, it can conclude that employees believe in the advantage of risk management and
important of it. However an executive said, it is not important for organization which means
top management do not assume that the impact of organizational risk is high and they do not
be aware of the advantages of it. Consequently, the repeated risks which are costly and affect
to the project schedule indistinctly are occurring in the projects. In summary of the initial
analysis stage, the practical limitation of risk management is having in this organization and it
causes higher uncertainty for the organization.

4.4 Differences risk factors between cases study

In this step, comparison of difference risk in Con (A) and (B) is carried out to discover the
major risks factor of organization and how it is different to influence in both projects. By
comparing and differentiating risk of projects can analyze the main factors of each project and
the interview data support to understand the rationale of practical risks in the project. There
are total ten categories of factors included in organizational risk management as aforesaid.

47
Each category is analyzed in detail based on checklist, questionnaire, recording data and
projects documents and then the main factor of risk is discovered. Finally, the conclusion of
each category is presented for the improvement of project efficiency.

4.4.1 Social network

Social network in construction organization is examined how project team members interact
with each other, characterizing many formal or informal connections in order to have effective
communication and coordination. There are five organizational factors include in social
network which are lack of influential power, mistrust between parties, complex organization
structure, culture difference and lack of delegation. According to the data analysis results,
mistrust between parties is moderately impact to social network of Con (B). The following
tables 4.7 show the data analysis results of social network.

Table 4.7: Data analysis results of social network in Con (A) and (B)

Construction Division (A)

Mean
Risk Factor Code Rank Class
Impact
Lack of influential power ca3 1.56 1 L
Mistrust between parties ca4 1.33 2 L
Complex organization structure ca1 1.33 3 L
Culture difference ca5 1.00 4 L
Lack of delegation ca2 1.22 5 L

Construction division (B)

Mean
Risk Factor Code Rank Class
Impact
Mistrust between parties cb4 2.00 1 M
Lack of influential power cb3 1.57 2 L
Complex organization structure cb1 1.57 3 L
Lack of delegation cb2 1.43 4 L
Culture difference cb5 1.00 5 L
Scale of Impact to Construction Schedule: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
Mistrust between parties is top rank in Con (B) with a mean of 2. It means lack of constructive
communication between different parties. This problem is happened not only because of
supporting physical assets of organization but also unclear method statement, an executive
said. This problem is occurred because Memorandum of Understanding (MOU) with
consultant, Kansai Electric Power Company (Japan) was finished in June, 2008 which causes

48
lack of expertise coordination in this project. As a result, method statements of activities are
not specified in task performing. Alternatively, Con (B) does not have higher demand of
progress compared to Con (A) but changes of key persons (assistant director) is happened
annually due to the top management unsatisfied the progress of the project. The changing of
assistant director is highly damage to personal communication which causes the absence of
recognition.

Lack of influential power is top rank with a mean of 1.56 in Con (A) whereas it is 2nd rank
with a mean of 1.57 in Con (B). According to data analysis results, these risks are low impact
to the social network of organization. Lack of influential power means senior position takes
care to lower positions such as motivation, job satisfaction, and personal development.
According to senior position of administrative department said, DHPI does not have proper
motivation program for employees except promotion of status. The investigation results of site
observation in Con (A), senior management use bureaucratic power and command
subordinates to perform task improperly. For example, senior management order to place
concrete before cleaning is totally finished because they want to get progress. According to a
construction engineer form power house construction said, this situation is usually happened
and they can not avoid the command of senior position although they know that cause the
weakness of bond between steel and concrete. It causes frustration to employees and affects to
the performance of them.

Alternatively, top management said, the organization does not provide specific technical or
managerial program for personal development of employees. According to interviews data
with assistant directors and staff officers, assistant director received 2 times maximum job
training related technical and managerial whereas staff officers had 1 time before. Moreover,
employees have to work depending upon the job requirement in project. Therefore, employees
are not expertise in specific area.

4.4.2 Knowledge Network

Knowledge network means transferring the individual knowledge from one to another in the
project team by defining as the provision or receipt of task information, knowhow, and
feedback regarding a product or procedure. There are three organizational risk factors include
in social network which are lack of cross-functional team, lack of knowledge sharing and lack
of regular meeting. According to the data analysis results, all three risks are low impact to the
knowledge network of Con (A) but lack of regular meeting is highly impact whereas the rest
two risk factors are moderately impact to knowledge network of Con (B). It is preferable that
organization has to control these risk factors in knowledge network because knowledge is one
of the main factors to complete the work properly. The following tables 4.8 show the data
analysis results of knowledge network in Con (A) and Con (B).

49
Table 4.8: Data analysis results of knowledge network in Con (A) and (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Ineffectiveness of cross-functional team ca6 1.11 1 L
Lack of Knowledge Sharing ca8 1.11 2 L
Lack of Regular meeting ca7 1.00 3 L

Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Lack of Regular meeting cb7 2.43 1 H
Ineffectiveness of cross-functional team cb6 2.00 2 M
Lack of Knowledge Sharing cb8 1.86 3 M
Scale of Impact to Construction Schedule: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
Lack of regular meeting is one of the high risk factors of Con (B) with a mean of 2.43 and
placed in 1st rank of knowledge network whereas it is at the lowest rank of Con (A). The
investigation results highlight obviously that regular meeting for coordination between
different parties is not having in Con (B) because of lack of close super vision of senior
management and consultant. An assistant director from Con (B) said that project meeting is
only holding either the senior management comes to project or after problems occurred.
However, the situation of Con (A) is totally different compared to Con (B) because it has not
only having regular weekly meeting within different parties but also all project members has
to attend the morning meeting including deputy project director at 6:30am everyday in order
to arrange the requirement of daily construction activities. Moreover, coordination of senior
management meeting is held within different parties monthly. According to mid-year
coordination meeting from Con (A), CPE (consultant) urged management of CCYW (Chinese
subcontractor) to attend monthly meeting of project regularly. It indicates how regular
meeting is important of construction project in order to perform the task effectively.
Therefore, it can conclude how regular meeting is important for project improvement. The
following figures 4.3 and 4.4 illustrate the coordination between different parties in Con (A).

50
 Figure 4.3: Senior Management progress Figure 4.4: Weekly Project Meeting
and coordination meeting (CPE-DHPI- (Contractor-Consultant-Subcontractors,
Subcontracts), Con (A) Con (A)

Ineffectiveness cross-functional team is 2nd ranks with a mean of 2 in Con (B). Cross
functional team means organizing special team from different functions of organization to
improve coordination and resolve mutual problems. Cross functionality is happened after
technical problem occurs such as surge tank collapse in Con (B). However, lack of expertise
in organization cause ineffectiveness of cross functional team performance. After penstock
tunnel shrink in Dec 2008 in Kun project (Con B-1), organization organized the cross-
functional team to solve the problem. However, according to construction engineer said, the
decision of cross-functional team was delayed up to 2 weeks and the problem was worse. The
result of ineffectiveness of cross-functional team causes delay and inaccurate decision making
in resolving problem.
Lack of knowledge sharing is placed 3nd rank with a mean 1.86 and moderately impact to Con
(B). Knowledge sharing means sharing the experience and knowledge within project team
members to solve the problems such as discrepancies of drawings, specifications and
construction defect. According to construction engineers said, they had knowledge sharing
with Kansai consultant on site discussing and (JEPIC) provide training related to hydroelectric
power to employees before. Kansai is one of member companies of Japanese Electric Power
Information Center (JEPIC). However they do not have knowledge sharing with other parties
since MOU of Kansai was finished. Knowledge sharing with Kansai (consultant) is not similar
to CPE (consultant) because CPE shared knowledge only how to construct.

According to process of design approval, proper knowledge sharing is not having between
CPE and DHPI regarding construction technology. The drawing and specification are directly

51
submitted from subcontractor; for example, CCYW (China) to CPE (Consultant). There has
three status of checked by CPE. 1) R-Reviewed, 2) RC- Reviewed with corrections indicated,
3) EC-Examined and returned for correction. Then, correction is updated by CCYW (China)
and submits to CPE again. After CPE approved and then send it to Design department of
DHPI, Project Directors, CCYW (site) then construction start. However, before construction
activities start, regular orientations between different parties are held for unclear method
statements and share the knowledge to perform effectively. If discrepancies of drawing or
specification are occurred, representative of CPE who standby on site is correcting minor
errors and try to help construction engineer by sharing experience and knowledge.

DHPI acts as local counter part of consultant for approval of subcontractors’ performance in
RCC Placing, hydraulic steel structures works and electromechanical works. An executive
said, CPE (consultant) provide specific training before started scope how to approve the
performance of subcontractor. Therefore, knowledge sharing is only happened on site between
CPE (consultant) and DHPI employees. However, according to the initial agreement with
CPE, the data analysis of construction designs will transfer after project complete. Therefore,
it can conclude that the sharing knowledge between CPE (consultant) and DHPI is only how
to perform the task during construction.

4.4.3 Information Network

Information network is defined as the transferring required information from one point to
another and exchange knowledge by internalization or technology acquisition from other
parties. Information is only considered as design specification, method statement and
construction schedule in this part. There are three organizational risk factors include in
information network which are inaccurate information, lack of coordination within project
team members and lack of functional coordination. According to the data analysis results,
inaccurate information is moderately impact to Con (A) whereas it is high impact to Con (B)
in information network. Moreover, lack of coordination within parties is moderately impact to
information network of Con (B). Moreover, it is obviously that organization has to control
these two risk factors in information network because providing information on time to right
person can protect the rework in construction. The following tables 4.9 show the data analysis
results of information network in Con (A) and Con (B).

Table 4.9: Data analysis results of information network in Con (A) and (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Inaccurate information ca9 1.67 1 M
Lack of coordination within parties ca10 1.44 2 L
Lack of functional coordination ca11 1.00 3 L

52
 Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Inaccurate information cb9 2.71 1 H
Lack of coordination within parties cb10 1.86 2 M
Lack of functional coordination cb11 1.29 3 L
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Providing inaccurate information in task performing is top rank in both project with a mean of
1.67 and 2.71 in Con (A) and Con (B). Inaccurate information is defined as organization
providing inaccurate information to perform task such as shop drawings, improper schedule,
specifications and method statement. However, the different factors influence both projects to
occur this problem. This problem is happened in Con (A) because organization provides many
revised shop drawings for task performing due to the incompetency of subcontractors. In mid-
year coordination meeting of Con (A), 2008, Chief Resident Engineer of CPE, Mr. Cowie
presented that although delayed submitting of civil work drawings from CCYW, construction
CVC works are preceding based on the initial design of CCYW in order to protect
construction delay. Therefore, it is possible that the final design of CCYW can be differed
from the completed CVC work. Consequently, the chipping work will be increased and it will
make delay in construction. However, the influence factor is differed in Con (B) compared to
Con (A).

Organization did not do proper initial survey data of construction design which cause
construction defect in execution. For examples, there had 3 times tunnel collapse already in
tunneling construction during construction and the surge tank was collapse after 80% finished
in 2007. Although many times construction failure, due to unclear specific roles and
responsibilities, no parties take responsible for that failures. As a result, organization has to
suffer the damage of failure.

Lack of coordination within parties takes place in 2nd rank of both construction divisions.
According to a representative of consultant (CPE), coordination of DHPI is bad because
although consultant point out the problem for improvement, they do not try to solve the
problem properly. For example, according to the 3rd coordination meeting (2006) between
Kansai and DHPI, the consultant point out the breakdown time of Jumbo was 50 hrs in Dec,
2005 to improvement of progress. However, DHPI did not take seriously action on the
problem. The breakdown time of Jumbo is currently almost 10days per month, a tunneling
engineer said.

4.4.4 Resource Network

Resource network means continuous resource available for concurrent activities in the
construction period. There are four organizational risk factors include in resource network
which are budget delay, receiving sub-quality resource, incompetence of suppliers and

53
incorrect resource allocation. According to the data analysis results receiving sub-quality
resources is moderately influenced to resource network of Con (B). Moreover, it is preferable
that organization has to control it in resource network because standardization of inputs
materials is one of the major factors to make sure the quality of output. The following tables
4.10 show the data analysis results of resource network in Con (A) and Con (B).

Table 4.10: Data analysis results of resource network in Con (A) and (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Budget delay ca14 1.44 1 L
Receiving Sub-quality resource ca13 1.44 2 L
Incompetency of supplier ca15 1.22 3 L
Incorrect resource allocation ca12 1.22 4 L

Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Receiving Sub-quality resource cb13 2.00 1 M
Budget delay cb14 1.43 2 L
Incorrect resource allocation cb12 1.43 3 L
Incompetency of supplier cb15 1.14 4 L
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Receiving sub-quality resources take top rank of Con (B) with a mean of 2.0. It means
construction engineers receive low quality resource which cause quality lose of construction.
Organization set up specific quality control department in Con (A) that check all imported
construction resources which supplied from suppliers time by time. However, Con (B) has
neither that kind of department nor responsible persons for controlling the imported resources
from the local suppliers. According to a construction engineer of dam construction said,
quality of aggregate is often lower than the standard because of the initial survey of quarry
was inaccurate. Moreover, due to lack of specific quality control department, sometimes local
suppliers try to cheat quality of resources in Con (B). Input materials of construction are very
important for the construction project to avoid the operational risk in the future. Additionally,
a geo-tech engineer said, the resources which directly supported from organization such as
explosive was expired and difficult to use for blasting. The figure 4.5 illustrates the quality
control of input materials in Con (A).

54
 Cement and Pozzolan test RCC and CVC test

Figure 4.5: Quality control of input materials in Con (A), Yeywa Hydroelectric Power
Project, Myanmar

Delay budget is top rank of Con (A) with a mean of 1.43 whereas it is 2nd rank of Con (B)
with a mean of 1.43 in resource network analysis. It means delay elay accessibility of budget
payment to employees for purchasing the cost of workforce and compulsory construction
materials. There have 4 steps of payment from organization to projects. Initial payment 30%
of estimated cost is offered
ed when the activities start and employees can withdraw the rest 60%
of payment according to the progress of work. The final payment 10% is received after
completion report is submitted. DHPI organization act as main contractor of MOEP (1) for all
hydropower implementation so all all the required budget come from the national budget and
which is approved by cabinet. However, delayed budget is sometime happened ha in both

55
projects when the actual cost is over estimated cost such as design variation, increase rate of
materials. Therefore, approval of actual cost is restarted from the beginning of the application
process and decision making is done by top management (Minister). Then, the revised cost is
submitted to cabinet. Therefore the application of requested extra cost process is too much
centralized in vertical hierarchy structure. A construction engineer said, delayed budget make
difficult for them to handle the skillful workforce and purchase for some compulsory
construction materials. In summary, it is preferable that top management need to control the
quality of resources from local suppliers is rather than others risks in Con (B). By setting up
either specific quality control department or assigning responsible persons is one of the proper
ways for organization to ensure the standardization of quality inputs just as Con (A).

4.4.5 Resource Usage Requirement

Resource usage requirement is defined combination of personal knowledge of employee and

supporting construction facilities in order to optimize the existing resource usage. There are
two organizational risk factors include in resource usage requirement which are lack of skilled
workforce and technical incompetency. According to the data analysis results, technical
incompetency is highly impact to Con (B) while lack of skilled workforce is moderately
influenced to resource usage requirement. Moreover, it is obviously that organization has to
control both risk factors in resource usage requirement because physical assets of such as
equipments and extent of knowledge is important for optimization existing resource in task
performing. The following tables 4.11 show the data analysis results of resource usage
requirement in Con (A) and Con (B)

Table 4.11: Data analysis results of resource usage requirement in Con (A) and Con (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
lack of skilled workforce ca16 1.67 1 M
Technical incompetency ca17 1.33 2 L

Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Technical incompetency cb17 2.86 1 H
lack of skilled workforce cb16 2.29 2 M
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Technical incompetency is the top rank in Con (B) with a mean of 2.86 whereas it is 2nd rank
of Con (B) with a mean of 1.33. Technical competency means physical asset of organization
and the extent of knowledge to optimize the resource usage. The actual efficiency of major
equipments such as Jambo, shot-crete machine is lower than 50% in Con (B). According to

56
the report of 3rd coordination meeting between DHP & Kansai Electric Power Company
(Japan), Kansai consultant point out to assign of a full-time
full time mechanic at site and daily check
by operators for the reduction of down time of Jumbo because the machine break down time
was 50 Hrs in Dec 2005. However, the same outdated and inefficiency equipments are still
using in the project. A tunneling engineer from Kun said that the existing Jumbo is too old and
he used it since the last project over 10 years ago. It breakdown time is currently around 10
days per month. Continuously iinn the report, two points of improvement is also incl
included for
reduction of over break in tunneling which are proper survey and marking before blasting and
careful attention to gradient
ient of drilling rod parallel to tunnel in drilling for blasting. It
indicates that the extent technical knowledge of employees is limited. The following figures
4.6 shows the existing technical incompetency
competency of organization in Con (B).

Figure 4.6: Technical incompetency of organization, Construction

struction Division (B)

Con (A) is one of the notational projects as well as the priority of organization so organization
support the best physical assets of organization which has 80% efficiency. Although in this
situation, they have still problem to transport the heavy machinery such as transformer of

57
Electrical and Mechanical installation because the net weight of transformer body is 72.5 tons
and they do not have enough ability of crane to support the transportation. Continuously, the
actual efficiency of existing mobile crane 70 tons is able to use for 40 tons operation, an
construction engineer said.

In summary, above reasons indicate that organization did not evaluate properly the technical
competency of the organization to perform the task effectively at the initial stages. Moreover,
it also mentions that organization has lack of regular evaluation for actual efficiency of
physical assets in order to perform effectively. As the technical competency is very important
for project performance, top management should take serious action to solve this problem and
improve the technical competency for optimization the resource usage in the project.
Therefore, the competency of workforce is preferable to improve for the long-term
organization strategy by providing required training to employees in order to maintain the
internal capability of organization.

Lack of skilled workforce is top rank with a mean of 1.67 in Con (A) while it takes 2nd rank
with a mean of 2.29 in Con (B). It means personal competency of workforce is difficult to
optimize the existing resource. According to the interviews data, both construction divisions
are facing lack of skilled workforce. An executive from Con (A) said, it is one of the main
challenges for them to perform the task with inexperience workforce in the initial stages. Top
management gives priority to Con (A) and support efficiency physical assets, budget, facilities
and assigning the qualify engineers of organization to challenge the problems but it is one of
the main problems that they usual face in construction stage is lack of experienced foremen of
hydroelectric power project. Normally, workforce in the projects are seasonal workers and
they do not have proper knowledge to construct.

Due to lack of skilled workforce in DHPI projects, the same skilled workforce has to extend
working time when progress demand is higher, Therefore, all permanent employees and
workers are exhausted after milestone passes. This problem is happened because investing in
hydropower sector of organization is continuously increased in 2 decades so that the demand
of experience workforce becomes higher. Organization implemented the first hydroelectric
power project in 1960s then there had no investment in hydropower sector in 1970s. However
organization restarted execution in three hydroelectric power projects in 1980s. The growth of
hydropower project implemented was gradually in 1990s and 2000s continuously. The
implemented projects in 2000s were 13 projects which is more than the combination of
implemented projects last 2 decades (10 projects) under organization. . On the other hand, due
to budget delay of organization, project loss skilled workforce. Therefore, unskilled workforce
causes inefficiency of performance in task performing. The following figure 4.7 shows the
growth of investment in hydroelectric power project implementation of organization within 5
decades.

58
 14
12
10

Number of project
8
6
4
2
0
1961- 1971- 1981- 1991- 2001-
1970 1980 1990 2000 2010
hydroelectric power
projects implemented 1 0 3 7 13

hydroelectric power
projects implemented 1 0 3 7 13

Figure 4.7: Implemented projects of organization in five decades

4.4.6 Inter-operability and co-usage requirement

Inter-operability and co-usage requirement means connections among resources and

substitutions to integrate the proper project schedule during execution period. There are three
organizational risk factors include in inter-operability and co-usage requirement which are
time constraint resource scheduling, geological barriers and resource shortage (out of stock).
According to the data analysis results, time constraint resource scheduling is moderately
influence to inter-operability and co-usage requirement in both Con (A) and Con (B).
Moreover, it is unmistakably that organization has to control this risk factors in resource usage
requirement because the rest factors of this category are external factors which can not be
controlled by organization. The following tables 4.12 show the data analysis results of inter-
operability and co-usage requirement in Con (A) and Con (B).

Table 4.12: Data analysis results of inter-operability and co-usage requirement in Con (A) and
Con (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Time constraint resource scheduling ca18 2.22 1 M
Geological barrier ca19 1.44 2 L
Resource shortage (out of stock) ca20 1.22 3 L

59
 Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Time constraint resource scheduling cb18 2.29 1 M
Geological barrier cb20 1.71 2 M
Resource shortage (out of stock) cb19 1.14 3 L
Scale of Impact to Construction Schedule:
Schedule Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Time constraint resource scheduling is top rank of both Con (A) and Con (B) with means of
2.22 and 2.29. Time constraint resource scheduling is defined as tough
tough to make schedule for
the demand of resources for activities under fixed time. As organization is state-owned
state
company, the resources available is come from the national budget annually. Annual budget
period is divided into four quarter for a year such as April-June,
June, July-September,
July October-
Dec, Jan March. Overall resource planning of organization is depended upon the combination
of annual planning of work from all projects. According to an executive from finance
department said limited resource available
available usually happen at the last quarter of budget period
in projects which affect the planning of schedule. The requested amount of budget is normally
received on time in the 1st and 2nd quarter and the limited budget or delay happen in third and
fourth quarter.
er. The regular receivable amount of budget is going down 80% to 90% in third
quarter and 70% to 80% at the end of the period. Then, the rest requested amount of budget
shift to next budget period. This situation happen because senior managements from each
project do not make detail planning of work in the general planning of work for the whole
year before budget period started. On the other hand, the total evaluation of organization on
cooperated required amount of resources usage in different projects is not accurate. As a
result, project eventually suffers loss of skilled workforce if it is happened frequently. The
following figure 4.8 presents the annual budget period of organization and resource available
quarterly.

Figure 4.8: Percentage of project received required resources in quarterly

Geological barrier is located at the 2nd rank in Con (A) and Con (B) with means of 1.44 and
1.71 in inter-operability
operability and co
co-usage
usage requirement of projects. It means national infrastructure
make barrier to transport heavy equipments, machinery and construction materials. It is
moderately impacted to Con (B) according to data analysis results. The maximum loading of

60
infrastructure in Myanmar is 60 tons including vehicle. Most machineries of mechanical and
electrical portion are heavy in hydropower construction. Therefore, it becomes a barrier for
them to transport these machineries from port to projects or from borders to projects.
According to an executive from Con (A) said, they have planning to transport the unit
transformers. However, the infrastructure can not support for transport heavy machinery
because just for net weight of transformer body is 72.5 tons. The following figure 4.9 shows
the transportation of gantry crane machineries from port to Con (A).

Figure 4.9: A part of gantry crane transportation to project

4.4.7 Assignment Network

Assignment network is examined assigning tasks to employees inside project and transferring
employees from one project to another project according to the job requirement. There are
four organizational risk factors include in assignment network which are insufficient human
resource, different attitude and assessment, improper arrangement of tasks and dissatisfaction
on job assigning. According to the data analysis results, insufficient human resource is
moderately influenced to assignment network of Con (B). It is a priority risk factor for
organization control because it is very important for organization to have the efficiency of
project. The following tables 4.13 show the data analysis results of assignment network in
Con (A) and Con (B).

Table 4.13: Data analysis results of assignment network in Con (A) and Con (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Insufficient human resource ca21 1.44 1 L
Different attitude and assessment ca22 1.33 2 L
Improper arrangement of tasks ca24 1.22 3 L
Dissatisfaction on job assigning ca23 1.11 4 L

61
 Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Insufficient human resource cb21 2.29 1 M
Improper arrangement of tasks cb24 1.57 2 L
Different attitude and assessment cb22 1.14 3 L
Dissatisfaction on job assigning cb23 1.00 4 L
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Insufficient human resource is the top rank of both projects with means of 2.29 in Con (B) and
1.44 in Con (A). It means limited quantity of experience employees for managerial and
technical available to perform the task in project. As aforesaid in figure 4.11, the growth of
projects become higher, the size of projects becomes higher. During 1980s, the maximum
installed capacity of biggest projects was 56 MW whereas 280 MWs was the biggest installed
capacity in 1990s. In 2000s, the installed capacity of Yeywa Hydroelectric Power Project, Con
(A) is 790 MW which is the biggest hydroelectric power project of Myanmar currently. The
growth of projects and bigger installed capacity of projects cause the greatly demand of
experience employees of organization in term of managerial and technical for all projects.
Figure 4.10 illustrates the maximum installed capacity in each decade.

900
800
Installed Capacity

700
600
500
400
300
200
100
0
1961- 1971- 1981- 1991- 2001-
1970 1980 1990 2000 2010
Maximum installed
capacity 168 0 56 280 790

Figure 4.10: Maximum installed capacity in each decade.

Table 4.14 shows the existing human resource of Con (A) in May, 2008. It indicates
significantly the insufficient human resource of organization. It is obviously that the absence
employee for managerial level of civil work was 48% whereas the operation level was 65% of
actual need. On the other hand, the absence employee for managerial level of mechanical is
56% whereas the operation of mechanical was 12%. The following table 4.14 illustrates the
gap between the permit, present and absence of employees in Con (A).

62
Table 4.14: Permanent employees in Con (A), Yeywa Hydroelectric Power Project

No. Types of Employees Permit Present Absence Absence%

1 Civil Engineering (Managerial) 254 131 123 48
2 Mechanical and Electrical Engineering
147 65 82 56
(Managerial)
3 Civil works (operation) 460 162 298 65
4 Mechanical and Electrical (operation) 533 450 83 12
Total 1394 808 586 42
Improper arrangement of tasks is 2nd rank of Con (B) with a mean of 1.57. Improper
arrangement of job tasks means senior management make improper arrangement of tasks to
different department. Planning activities in the Con (B) are making decision by the senior
management based on their experience. Lack of project management experience of senior
position causes improper arrangement of tasks in Con (B), a construction engineer said.
According to their profiles, deputy project director of Con (B) did not have good experience in
infrastructure project before and assistant director of Con (B-1), Kun Project has only 3 years
experience and assistant director of Con (B-2) has 7 year experience in hydroelectric power
construction. This situation is highly different with Con (A) because Deputy Project Directors
has total over 20 years experience in construction projects as well as other 4 Assistant
Directors have over 7 years experience in hydropower construction. In summary, the
competency of employees is preferable to improve for the long-term organization strategy by
providing job training in oversea projects and sending oversea further study for technical and
managerial competency in order to develop the human resource of organization.

4.4.8 Resource Requirement

Resource requirement means organization supporting the required resources to project to

perform the task effectively. There are two organizational risk factors impact to resource
requirement of project which are delay major equipment and delay key resources. According
to the data analysis results, both factors are moderately impact to Con (B) whereas it is low
impact to Con (A). It is obviously that organization has to control these both risk factors
because resource is most important to continue the construction by supporting on time. The
following tables 4.15 show the data analysis results of resource requirement in Con (A) and
Con (B).

Table 4.15: Data analysis results of resource requirement in Con (A) and Con (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Delay major equipment ca27 1.56 1 L
Delay key resources ca26 1.33 2 L

63
 Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Delay major equipment cb27 2.29 1 M
Delay key resources cb26 1.71 2 M
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4
Delay major equipment and delay key resources are medium risk factors in resource required
analysis compared to delay key construction materials. Delay Major Equipment takes places at
the top rank Con (B) with a mean of 2.29. Delay Major Equipment means projects receive late
major equipment in order to perform the critical activities. According to mid-year
coordination meeting of Con (A), CPE (consultant) recommend to CCYW to increase the rate
of import major electromechanical equipments i.e. unit transformer, 11kv bus bars and turbine
governors and submitting detail design as soon as possible by improving the coordination
between CCYW (China) and CCYW (Myanmar). Alternatively, DHPI, organization did not
evaluate the actual requirement of major equipments for all projects which cause delay major
equipment to support the project on time. Hydroelectric project includes heavy machinery
installing such as electromechanical installation so major equipment play as a vital role to
have efficiency of performance. Beside once, executives said, organization can not support
sufficient major equipment to projects in order to perform smoothly because of lack of budget
in organization.

Delay key resource is 2nd rank in both Con (A) and (B) with means of 1.33 and 1.71. It is
moderately impact to Con (B). Delay key resource means delay accessibility of key materials
such as steel, cement, explosives, fuel. Generally, major construction key materials such as
pozzolan, cement, steel are produce in local for projects except fuel. The capacity of local
production is limited so when the demand of national projects are higher, the quota of
organization lesser. For examples, the cement receivable of projects went down to 0% because
of Nargis Disaster was happened in May. This is one of the major risk factor which impact
construction schedule in preplanning of activities. However, due to top management
perceptive on Con (A) very carefully rather than others, the quota of resources for Con (A) is
usually higher than other project under DHPI organization. The following Figure 4.11 shows
the delay resource of Con (B-1), Kun Project. Organization supported delay quantities of
diesel for April and May in July 2008. And also, organization supported delay quantities of
cement for April, May and June in July. Therefore, when the receivable amount of
organization is delay, senior management has to give privilege to critical activities.
Consequently, uncritical activities have fewer floods and it becomes critical activities later, an
executive said. In summary, the construction materials can be used locally and the demand of
construction material in project is higher than supply.

64
 500
450
400

% of Resources received
350
300
250
200
150
100
50
0
Ma Jun
Apr July Aug Sep Oct Nov Dec
y- e-
-08 -08 -08 -08 -08 -08
- -08
08 08
Received Diesel (%) 81 52 100 125 100 117 74 65 64
Received Cement (%) 83 42 0 435 103 257 38 35 116
Received Steel (%) 100 100 100 23 0

Figure 4.11: Delay resource of Con (B-1), Kun Project

4.4.9 Precedence and dependencies

Precedence and dependencies is defined generation, verification and modification of

construction project schedule networks in PERT/CPM (Project Evaluation and Review
Technique/Critical Path Method) chart. There areare two organizational risk factors include in
precedence and dependencies which are Technology constraints and resource constraint
project scheduling.. According to the data analysis results, technology constraint is highly
influenced to Con (B) whereas it iiss moderately impact to Con (A) in precedence and
dependencies.. It is preferable for organization to upgrade this kind of technology for
effectiveness of project scheduling in precedence and dependencies. The following tables 4.16
4.
show the data analysis results of precedence and dependencies in Con (A) and Con (B).

Table 4.16: Data analysis results of precedence and dependencies in Con (A) and Con (B)

Construction (A)
Mean
Risk Factor Code Rank Class
Impact
Technology constraints ca29 2.00 1 M
Resources constraint project scheduling ca28 1.56 2 L
Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Technology constraints cb29 2.71 1 H
Resources constraint project scheduling cb28 2.00 9 M
Scale of Impact to Construction Schedule:
Schedule Low=1-1.7, Medium= 1.6-2.4, High= >2.4

65
Technology constraint is top rank of both construction divisions with means of 2.0 in Con (A)
and 2.71 in Con (B). It means duration of activities depend on the planning technology as well
as project management technology such as Primavera. Project management is meant the
combination of experience of employees who participate in the project and the practicing
supporting planning technology and managing software.

DHPI, organization does not use planning technology as well as project management
technology such as primavera in order to generate the project network. In project, senior
management only try to control the activities on the critical paths in the project which is not
sufficient for decreasing the risk of overrunning the schedule because the uncritical path
become critical due to the uncertainty in activity durations. Most employees in Con (A) and
Con (B) are low experience in infrastructure project implementation. Moreover, they did not
have any previous project like Con (A). According to an executive said, it is hard job for them
to newly generate a project network without any previous cases. Therefore, extra works are
required to add in the reality and which cause fewer floods to the uncritical activities. An
executive said that lack of preplanning technology constraint the performing activities in term
of workforce, material and equipments in the constructed projects.

On the other hand, due to lack of detail planning of activities in critical path of general
Planning of Work (POW), consequently, extra cost is needed for revising the estimated cost in
the reality. However, requested additional cost for extra work or extra activities is usually
delayed due to central cost control system as aforesaid. Therefore, it is necessary for
organization to Upgrade project management technology and enhance the capability of
organization by maintaining the project methodology.

Resource constraint project scheduling is located at the 2nd rank in precedence’s and
dependencies with means of 2.0. It is moderately impact to the Con (B). It means limited
quantities resources receiving for the demand of concurrent activities. This problem occurs in
project frequently due to key resources of DHPI’s projects is only depended upon the local
production as aforesaid delay key resources in resource requirement of organization. If
supporting resources of organization is less than actual need, senior management has to
arrange back activities schedule on site situation. Mostly if the quantities of resources are less,
senior management makes decision privilege to priority of work and performs the task. A
construction engineer from Con (A) said, this problem cause less flood for the uncritical path
of concurrent activities but later it becomes the critical path in construction schedule.
According to an executive from Con (2), they stop some uncritical path of activities due to
lack of fuel while investigation was doing. This is one of the major problems why most
construction projects delay in the past. In figure 4.12, percentage of organization supported
resource in 1st quarter to Con (A), diesel 72% of requirement in April and May whereas the
minimum received quantity of cements was 57 % of actual requirement of April in 1st quarter.
It is obviously that delay of key material, steel was supported 20% of the actual demand of
April.

66
 80

% of Resources received
70
60
50
40
30
20
10
0
Ma
Apr Jun July Aug Sep Oct- Nov Dec
y-
-08 e-08 -08 -08 -08 08 -08 -08
08
Received Diesel (%) 72 72
Received Cement (%) 76 57
Received Steel (%) 20 37

Figure 4.12: Percentage of organization supported resource in 1st quarter to Con (A)

In Kun Hydroelectric Power Project, Con (B (B-1),

1), project received extra 200 tons of steel early
to protect the lack of resources. However, organization did not support steel up to Dec. so the
requirement of steel start problem to make pro proper
per working schedule start from Dec. Minimum
received of diesel was 52% of actual requirement in May but organization
organization supported the delay
quantities of diesel in July. In June, 2008, construction division (B) did not receive any
cement of requirement, 0%. Organization supported the extra quantities of cement and diesel
in July to fill back. However, some schedules of activities were already delayed in last 3
months due to lack of resources. The following figure 4.13 4. mentions percentage of
organization supported
rted resources in first three quarter to Con (B-1,
(B 1, Kun Project) in 2008
2008-2009
budgeting period.

500
% of Resources received

450
400
350
300
250
200
150
100
50
0
Apr May June July Aug Sep- Oct- Nov Dec
-08 -08 -08 -08 -08 08 08 -08 -08
Received Diesel (%) 81 52 100 125 100 117 74 65 64
Received Cement (%) 83 42 0 435 103 257 38 35 116
Received Steel (%) 100 100 100 23 0

Figure 4.13: Percentage of organization supported resources in first three quarter to Con (B-
(B
1), Kun Project

67
In Phyu Hydroelectric Power Project, Con (B (B-2), the
he overall received resources were not too
much different to the actual demand compared to Con (B-1).(B 1). Although organization supported
less than requirement, Project management can arrange the construction schedule due to initial
extra supported resources iiss still left. Organization supported the lesser quantities of diesel
than actual need in first two month in April and May. Although organization did not support
cement in June and August, it supported extra amount of diesel in the month before those
month; 259% in May and 697% in July. However, organization supported sufficient quantities
of steel in this project. The following figure 4. 4.14 mentions percentage of organization
supported resources in first three quarter to Con (B (B-2, Phyu Project) in 2008
2008-2009 budgeting
period.

800
700
% of Resources received

600
500
400
300
200
100
0
Apr- May- June- July- Aug- Sep- Oct- Nov-
08 08 08 08 08 08 08 08
Received Diesel (%) 70 100 171 200 100 100 100 327
Received Cement (%) 44 259 0 697 0 360 175 34
Received Steel (%) 226 39 726 726 228 127 70 70

Figure 4.14:: Percentage of organization supported resources in first three quarter to

Con (B-2), Phyu Project

4.4.10 Summary

Based on the factors identification process,

process, some key risks factors and degree of impacts of
risk are different in Con (A) and (B). Difference risk in Con (A) and (B) are separately
identified by ranking based on the mean of impact to efficiency of projects. Four key risks
which moderately impact to the efficiency of Con (A) are 1) Technology constraints, 2) Time
constraint resource scheduling, 3) Inaccurate information and 4) Lack of skilled workforce.

However, top 3 ranks of risks are highly and the rest 7 risks of top ten risks are moderately
impact to efficiency of Con (B). Top rank risks influenced the efficiency of Con (B) are 1)
Technical incompetency, 2) Technology constraints, 3) Inaccurate infor
information, 4) Lack of

68
regular meeting, 5) Time constraint resource scheduling, 6) Lack of skilled workforce, 7)
Insufficient human resource, 8) Delay major equipment, 9) Ineffectiveness of Cross functional
team and 10) Resource constraint project scheduling. The following table 4.17 shows
comparison of top ranks key risks in Con (A) and (B).

69
Table 4.17: Comparison of top rank factors key risks in Con (A) and Con (B)

Con (A) risk factor ranking Con (B) risk factors ranking

Mean Classificatio Mean

Risk factor Rank Rank Classification
(Impact) n Risk factor (Impact)
Time constraint Technical
2.22 1 M 2.86 1 H
resource scheduling incompetency
Technology
2.00 2 M 2.71 2 H
constraints Technology constraints
Inaccurate
1.67 3 M 2.71 3 H
information Inaccurate information
Lack of skilled Lack of regular
1.67 4 M 2.43 4 M
workforce meeting
Lack of influential 1.56 5 L Time constraint 2.29 5 M
power resource scheduling
Lack of skilled
1.56 6 L 2.29 6 M
Delay information workforce
Delay major Insufficient human
1.56 7 L 2.29 7 M
equipment resource
Resources constraint Delay major
1.56 8 L 2.29 8 M
project scheduling equipment
Ineffectiveness of
1.44 9 L 2.00 9 M
Budget delay cross-functional team
Resources constraint
1.44 10 L 2.00 10 M
Lack of coordination project scheduling
Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4

70
4.5 Overall ranking of key organizational risk factors

After the description of difference risk factors between projects, the explanation of top rank
risk factors are found out by using cases study synthesis method. In this step, top risk factors
are ranked by mean of impact and analysis is carried out to measure the degree of top risks in
overall organization. The analytic data are collected from total 16 respondents in two
construction divisions by using questionnaire survey and interviews. The main purpose of the
results form data analysis are interpreted and discussed to identify and classify the
importance level of main organizational factors influencing the construction schedule which
cause project delay.

According to a combination results of both projects and analysis, the main organizational
factors (the first top 10 ranked) which influence projects efficiency in term of time are
Technology constraint, Time constraint resource scheduling, Inaccurate information, Lack of
skilled workforce, Lack of regular meeting, Technical incompetency, Insufficient human
resource, Mistrust between parties and Resource constraint project scheduling. These
organizational factors are grouped as a high importance level for influencing project schedule.
The following table 4.18 shows the analysis of organizational risk factors influencing project
that is affecting to construction schedule.

Table 4.18: Analysis of overall organizational factors influencing project

ca= Con (A), cb= Con (B)

Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
Mean Overall Mean
Classifica
Risk Factor Codes (Degree of (Degree of Rank
tion
Impact) Impact)
ca29 2.00 1 M
Technology constraints 2.36
cb29 2.71
Time constraint resource ca18 2.22 2 M
2.26
scheduling cb18 2.29
ca9 1.67 3 M
Inaccurate information 2.19
cb9 2.71
ca17 1.33 4 M
Technical incompetency 2.10
cb17 2.86
ca16 1.67 5 M
Lack of skilled workforce 1.98
cb16 2.29
ca27 1.56 6 M
Delay major equipment 1.93
cb27 2.29
ca21 1.44 7 M
Insufficient human resource 1.87
cb21 2.29
Resources constraint project ca28 1.56 8 M
1.78
scheduling cb28 2.00

71
 ca13 1.44 9 M
Sub-quality resource 1.72
cb13 2.00
ca7 1.00 10 M
Lack of regular meeting 1.72
cb7 2.43
ca4 1.33 11 M
Mistrust between parties 1.67
cb4 2.00
ca10 1.44 12 L
Lack of coordination 1.65
cb10 1.86
ca25 1.56 13 L
Delay information 1.57
cb25 1.57
Ineffectiveness of cross-functional ca6 1.11 14 L
1.56
team cb6 2.00
ca3 1.56
Lack of influential power 1.57 15 L
cb3 1.57
ca26 1.33
Delay key resources 1.52 16 L
cb26 1.71
ca8 1.11
Lack of knowledge Sharing 1.49 17 L
cb8 1.86
ca20 1.22
Resource shortage (out of stock) 1.47 18 L
cb20 1.71
ca1 1.33
Complex organization structure 1.45 19 L
cb1 1.57
ca14 1.44
Budget delay 1.44 20 L
cb14 1.43
ca24 1.22
Improper arrangement of tasks 1.40 21 L
cb24 1.57
ca2 1.22
Lack of delegation 1.33 22 L
cb2 1.43
ca19 1.44
Geological barrier 1.29 23 L
cb19 1.14
ca12 1.11
Incorrect resource allocation 1.27 24 L
cb12 1.43
ca22 1.33
Different attitude and assessment 1.24 25 L
cb22 1.14
ca15 1.22
Incompetency of supplier 1.18 26 L
cb15 1.14
ca11 1.00
Lack of functional coordination 1.15 27 L
cb11 1.29
ca23 1.11
Dissatisfaction on job assigning 1.06 28 L
cb23 1.00
ca5 1.00
Culture difference 1.00 29 L
cb5 1.00

72
4.5.1 Technology Constraint

Technology Constraint is a factor of precedence and dependencies of organization. It is top of

ranks of overall project risk of organization with a mean of 2.36. It is moderately impact to the
project schedule. Technology constraint means lack of using planning technology as well as
project management technology such as Primavera. Project management is meant the
combination of experience of employees who part participate
icipate in the project and the practicing
supporting planning
anning technology and managing software.

DHPI, organization does not use planning technology as well as project management
technology such as primavera in order to generate the project network. In project, senior
management only try to control the activities
activities on the critical paths in the project which is not
sufficient for decreasing the risk of overrunning the schedule because the uncritical path
become critical due to the uncertainty in activity durations. Most employees in Con (A) and
Con (B) are low experience
perience in infrastructure project implementation. Moreover, they did not
have any previous project like Con (A)
(A).. According to an executive said, it is hard job for them
to newly generate a project network without any previous cases. Therefore, extra works are
required to add in the reality and which cause fewer floods to the uncritical activities. An
executive said that lack of preplanning technology constraint the performing activities in term
of workforce, material and equipments in the constructed projects.
proje The following figure 4.15
4.
illustrates the logic model of organizational factors and project risk in precedence and
dependencies.

Figure 4.15: logic model of organizational factors and project risk in precedence and
dependencies

On the other hand,, due to inexperience of employees, activities is not precise in critical path of
general Planning of Work (POW). Consequently, extra cost is needed for revising the
estimated cost in the reality. However, requested additional cost for extra work or extra

73
activities is usually delayed due to central cost control system as aforesaid. On the other hand,
activities expand the duration of planned activities in the critical path. Therefore, it is
necessary for organization to upgrade project management technologytechnolog and enhance the
capability of organization by maintaining the project methodology.
methodology The following figure 4.15
illustrates the logic model of organizational factors and project risk in precedence and
dependencies.

4.5.2 Time constraint resource scheduling

Time constraint resource scheduling is a factor of inter-operability

operability and co-usage
co requirement
of organization. It is 3rd rank of overall project risk of organization with a mean of 6.30 and
93% of respondent agreement. It is defined as tough to make sched schedule
ule for the demand of
resources for activities under fixed time. As organization is state- state-owned company, the
resources available is come from the national budget annually. Annual budget period is
divided into four quarter for a year such as April-June,
April July-September,
September, October
October-Dec, Jan
March. Overall resource planning of organization is depended upon the combination of annual
planning of work from all projects. The following figure 4.16 the logic model of
organizational risk factors and project risk in inter-operability
inter and co-usage
usage requirement.

Figure 4.16: Logic model of organizational risk factors and project risk in inter-operability
inter
and co-usage requirement

According to an executive from finance department said that limited resource available
usually happen at the last quarter of budget period in projects which affect the planning of
schedule. The requested amount of budget is normally received on time and the limited budget
or delay happen in third and fourth quarter
quarter.. The regular receivable amount of budget is going
down 80% to 90% in third quarter and 70% to 80% at the end of the period. Then, the rest
requested amount of budget shift to next budget period. This situation happen because senior
managements from each project
roject do not make detail planning of work in the general planning
of work for the whole year before budget period started. As a result, delay budget for extra
cost for additional schedules is occurred in the project. On the other hand, the total evaluation

74
of organization on cooperated required amount of resources usage in different projects is not
accurate. As a result, project eventually suffers loss of skilled workforce if it is happened
frequently.

4.5.3 Inaccurate information

Inaccurate information is a factor of information network of organization. It is 3rd rank of

overall project risk of organization with a mean of 2.19. Inaccurate information is defined as
organization
rganization providing inaccurate information to perform task such as shop drawings,
improper
per schedule, specifications and method statement. However, the different factors
influence both projects to occur this problem. This problem is happened in Con (A) because
organization provides many revised shop drawings for task performing due to the
incompetency
ompetency of subcontractors. In mid-year year coordination meeting of Con (A), 2008, Chief
Chie
Resident Engineer of CPE, Mr. Cowie presented that although the delay submitting of civil
work drawing from CCYW, construction CVC works are preceding based on the initial initia design
of CCYW in order to protect construction delay. Therefore, it is possible that the finial design
of CCYW can miss with the completed CVC work. Consequently, the chipping work will be
increased and it will make delay in construction. However, the iinfluence
nfluence factor is differed in
Con (B) compared to Con (A). The following figure 4.17 illustrates the logic model of
organizational risk factors and project risk in information network.

Figure 4.17: Logic model of organizational risk factors and project risk in information
network

On the other hand, organization did not do proper initial survey data of construction design
which cause construction defect in execution. For examples, there had 3 times tunnel collapse
already in tunneling construction during construction and the surge tank was collapse after

75
80% finished in 2007. Although many times construction failure, due to unclear specific roles
and responsibilities, no parties take responsible for that failures.

4.5.4 Technical Incompetency

Technical incompetency is a factor of resource usage requirement of organization. It is 4th

rank of overall project risk of organization with a mean of 2.1 and moderately impact to the
construction schedule of projects
p under DHPI organization. Technical competency means
physical asset of organization and the extent of knowledge to optimize the resource usage.

The actual efficiency of major equipments such as Jambo, shoot-crete

shoot crete machine is lower than
50% in Con (B). ). According to the report of 3rd coordination meeting between DHP & Kansai
Electric Power Company (Japan), Kansai consultant point out to assign of a full full-time
mechanic at site and daily check by operators for the reduction of down time of Jumbo
because the
he machine break down time was 50 Hrs in Dec 2005. However, the same outdated
and inefficiency equipments are still using in the project. A tunneling engineer from Kun said
that the existing Jumbo is too old and he used it since the last project over 10 years ye ago. It
breakdown time is currently around 10 days per month. In the report, two points of
improvement is also included for reduction of over break in tunneling which are proper survey
and marking before blasting and careful attention to gradient of drilling
drilling rod parallel to tunnel
in drilling for blasting. It indicates that the extent technical knowledge of employees is limited
to optimize the resource usage as well. The following figure 4.18 illustrates the logic model of
organizational risk factors and
an project risk in resource usage requirement.

Figure 4.18: Logic model of organizational risk factors and project risk in resource usage
requirement

76
Con (A) is one of the notational projects as well as the priority of organization so organization
support the best physical assets of organization which has 80% efficiency. Although in this
situation, they have problem to transport the transformer of Electrical and Mechanical
installation because the net weight of transformer body is 72.5 tons and they do not have
enough ability of crane to support the transportation. Continuously, the actual efficiency of
existing mobile crane 70 tons is able to use for 40 tons operation.

In conclusion, above reasons indicate that organization did not evaluate properly the technical
competency of the organization to perform the task effectively at the initial stages. Moreover,
it also mentions that organization has lack of regular evaluation for actual efficiency of
physical assets in order to perform effectively. As the technical competency is very important
for project performance, top management should take serious action to solve this problem and
improve the technical competency for optimization of resource usage in the project.
Therefore, the competency of workforce is preferable to improve for the long-term
organization strategy by providing required training to employees in order to maintain the
internal capability of organization. The following figure 4.18 illustrates the logic model of
organizational risk factors and project risk in knowledge usage requirement.

4.5.5 Lack of skilled workforce

Lack of skilled workforce is a factor of resource usage requirement of organization. It is 5th

rank of overall project risk of organization with a mean of 1.98. It means personal competency
of workforce is difficult to optimize the existing resource. According to the interviews data,
organization has faced lack of skilled workforce. Con (A) is the biggest project of Myanmar
as well as organization. An executive from Con (A) said, it is one of the main challenges for
them to perform the task with inexperience workforce in the initial stages. Top management
gives priority to Con (A) by supporting efficiency physical assets, budget, facilities and
assigning the qualify engineers of organization to challenge the problems but one of the main
problems that they usual face in construction stage is lack of experience foreman of
hydropower project.

Due to lack of skilled workforce in DHPI project, the same workforce has to extend working
time when progress demand is higher, Therefore, all permanent employees and workers are
exhausted after milestone passes. This problem is happened because investing in hydropower
sector of organization is continuously increased in 2 decades so that the demand of experience
workforce becomes higher. Organization implemented the first hydroelectric power project in
1960s then there had no investment in hydropower sector in 1970s. However organization
restarted execution in three hydroelectric power projects in 1980s. The growth of hydropower
project implemented was gradually in 1990s and 2000s continuously. The implemented
projects in 2000s were 13 projects which is more than the combination of implemented
projects last 2 decades (10 projects) under organization. On the other hand, due to budget
delay of organization, project loss skilled workforce. Therefore, unskilled workforce causes

77
inefficiency of performance in task performing. The following figure 4.19
4. illustrates the logic
model of organizational risk factors and project risk in resource usage requirement.

Figure 4.19: Logic model of organizational risk factors and project risk in resource usage
requirement

4.5.6 Delay major equipment

Delay major equipment is a factor of resource requirement of organization. It is 6th rank of

overall project risk of organization with a mean of 1.93 and moderately impact to the
construction schedule of projects under DHPI organization.
organization Delay Major Equipment means
projects receive
ceive late major equipment in order to perform the critical activities. According to
mid-year
year coordination meeting of Con (A), CPE (consultant) recommend to CCYW to
increase the rate of import major electromechanical equipments i.e. unit transformer, 11kv bus
bars and turbine governors and submitting detail design as soon as possible by improving the
coordination between CCYW (China) and CCYW (Myanmar). The following figure 4.20 4.2
illustrates the logic model of organizational risk factors and project risk in resource
requirement.

Figure 4.20: Logic model of organizational risk factors and project risk in resource
requirement

78
Alternatively, DHPI organization did not evaluate the actual
actual requirement of major equipments
for all projects which cause delay major equipment to support the project on time.
Hydroelectric project includes heavy machinery installing such as electromechanical
installation so major equipment play as a vital role
role to have efficiency of performance. Beside
once, executives said, organization can not support sufficient major equipment to projects in
order to perform smoothly because of lack of budget in organization.

4.5.7 Insufficient human resource

man resource is a factor of assignment network of organization. It is 7th rank of

Insufficient human
overall project risk of organization with a mean of 1.87 and moderately impact to the
construction schedule of projects under DHPI organization
organization. Insufficient human resource
means limited quantity of experience employees for managerial and technical available to
perform the task in project. According to a representative of consultant, due to higher demand
of progress, employees in Con (A) do not havehave specific shift and holidays. They have to work
depended upon the senior mgt arrangement on work. Consequently, they are exhausted and
unmotivated so their performance is decreased. Continuously, a bottle neck in hydropower
construction is sufficient availability
avai of experience workforce.

Figure 4.21 illustrates the gap between the permit, present and absence of employees in Con
(A) in May, 2008. It indicates significantly the insufficient human resource of organization. It
is obviously that the absence employee
employee for managerial level of civil work was 123 whereas the
operation level was 82 of actual need. On the other hand, the absence employee for
managerial level of mechanical is 298 whereas the operation of mechanical was 83. The total
absence of permanentt employees iin Con (A) at that time was 586.
quantity of human resource

1600
1400
1200
1000
800
600
400
200
0
Mech, Elec Civil Mech, Elec
Civil (mgt) Total
(mgt) (operation) (operation)
Permit 254 147 460 533 1394
Present 131 65 162 450 808
Absense 123 82 298 83 586

Figure 4.21: Permanent employees of Yeywa Hydroelectric Power Project in May, 2008,
Construction Division (A)

79
The experience and background of employees in organization is illustrated in the following
figure 4.29.
.29. In figure, the majority of assistant directors 83% of organization are 44-7 years
experience with bachelor degree holder and only 17% of assistant directors are 8-128 years
experience and Master degree holder. For staff officer, 90% of them are bachelor degree
holders while 705 of them have 4-7 4 7 years experience in construction hydroelectric power
4.22 shows the experience
projects. The following figure 4.2 xperience and education background of
employees in Con (A) and Con (B).

100
80
60
%

40
20
0
13- Dipl Bach Mast
1-3 4-7 8-12
19 oma elor er
Education
Experience yrs
background
Assistant Directors (%) 83 17 0 83 17
Staff Officers (%) 20 70 10 0 10 90

Figure 4.22: Experience and education background of employees in organization

Due to higher number of absence employee in the project, the span of control of employees is
wider than actual. According to top management, organization does not provide specific
technical or managerial training to employees which cause poor project management skill to
them. Eventually, less of supervision is occurred in the task performing. Consequently,
construction defect is occurred and rework impact to construction schedule. The following
figure 4.23 illustrates the logic model of organizational risk factors and project risk in
assignment network.

Figure 4.23: Logic model of organizational risk factors and project risk in assignment
network

80
4.5.8 Resource constraint project scheduling

Resource constraint project scheduling is a factor of precedence and dependencies of

organization. It is 8th rank of overall project risk of organization with a mean of 1.78 and
moderately impact to the construction schedule of projects under DHPI organization. It means
limited
ed quantities resources receiving for the demand of concurrent activities. This problem
occurs in project frequently due to key resources of DHPI’s projects is only depended upon
the local production as aforesaid delay key resources in resource requirement of organization.
If supporting resources of organization is less than actual need, senior management has to
arrange back activities schedule on site situation. Mostly if the quantities of resources are less,
senior management makes decision privilege to priority
priority of work and performs the task. A
construction engineer from Con (A) said, this problem cause less flood for the uncritical path
of concurrent activities but later it becomes the critical path in construction schedule.
According to an executive from Con (2), they stop some uncritical path of activities due to
lack of fuel while investigation was doing. This is one of the major problems why most
construction projects delay in the previous of DHPI’s projects.. The following figure 4.24
shows the logic model of organizational risk factors and project risk in precedence and
dependencies.

Figure 4.24: Logic model of organizational risk factors and project risk in precedence and
dependencies

4.5.9 Sub-quality
quality resource

Sub-quality resource is a factor of resource network of organization. It is 9th rank of overall

project risk of organization with a mean of 1.72 and moderately impact to the construction
schedule of projects under DHPI organization. It means construction engineers receive low
quality resource which cause quality lose of construction. Organization set up specific quality
control department in Con (A) that check all imported construction resources which supplied
from suppliers time by time. However, Con (B) has neither that kind of department nor no

81
responsible persons for controlling the imported resources from the local suppliers. According
to a construction engineer of dam construction said, quality of aggregate is often lower than
the standard because of the initial survey of quarry was inaccurate.
inaccurate. Moreover, due to lack of
specific quality control department, sometimes local suppliers try to cheat quality of resources
in Con (B). Input materials of construction are very important for the construction project to
avoid the operational risk in the future.
f In addition, a geo-tech
tech engineer said the resources
which directly supported from organization such as explosive was expired and difficult to use
for blasting.

In summary, it is preferable that top management need to control the quality of resources from
local suppliers is rather than others risks in Con (B). By setting up either specific quality
control department or assigning responsible persons is one of the proper
proper ways for organization
to ensure the standardization of quality inputs just as Con (A). The following figure 4.25 4.
shows logic model of organizational risk factors and project risk in resource network.

Figure 4.25: Logic model of organizational risk factors and project risk in resource network

4.5.10 Lack of regular meeting

Lack of regular meeting is a factor of resource network of organization. It is 10th rank of

overall project risk of organization with a mean of 1.72 and moderately impact to the
construction schedule of projects under DHPI organization. The investigation results highlight
obviously that regular meeting for coordination between different parties is not having in Con
(B) because of lack of close super vision of senior management and consultant. An assistant
director from Con (B) said that project meeting is only holding either the senior management
comes to project or after problems occurre
occurred.
d. However, the situation of Con (A) is totally
different compared to Con (B) because it has not only having regular weekly meeting within
different parties but also all project members has to attend the morning meeting including
deputy project director at 6:30am everyday in order to arrange the requirement of daily
construction activities. Moreover, the senior management meeting is held within different

82
parties monthly. According to mid
mid-year
year coordination meeting from Con (A), CPE (consultant)
urged management ent of CCYW (Chinese subcontractor) to attend regularly the monthly meeting
of project. It indicates how regular meeting is important of construction project in order to
flowing have effective communication between different parties. The following figure 4.26
4
shows logic model of organizational risk factors and project risk in knowledge network.

Figure 4.26: Logic model of organizational risk factors and project risk in knowledge
network.

4.5.11 Mistrust between parties

Mistrust between parties is a factor of social network of organization. It is 11th rank of overall
project risk of organization with a mean of 1.67 and moderately impact to the construction
schedule of projects under DHPI organization
organization. It means lack of constructive communication
between different parties. This problem is happened because of unclear method statement, an
executive said. This problem is occurred in Con (B) because Memorandum of Understanding
(MOU) with consultant, Kansai Electric Power Company (Japan) was finished in June, 2008
which causes lack of expertise coordination in this project. As a result, method statements of
activities are not specified for task performing. Alternatively, Con (B) does not have higher
demand of progress compared to Con (A) but changes of key key persons (assistant director) is
happened annually due to the top management unsatisfied the progress of the project. The
changing of assistant director is highly impact to personal communication which causes the
absence of recognition.

Mistrust between parties in Con (A)

Mistrust between Department of Hydropower Implementation (DHPI) and China Gezhouba

Water & Power Group Co.Ltd (CGGC). It is happened because of the incompetency of

83
CGGC, main dam contractor which take responsible for placement of Roller Compacted
Concrete (RCC) in Main Dam construction. According to Colenco Power Engineer (CPE)
specification, maximum dump RCC concrete from the truck must be 400mm. However, the
employees from CGGC allowed dumping RCC concrete more than 600mm and compacted in
order to have progress. Therefore, the conflicts occurred between DHPI and CGGC parties.
According to a construction engineer from DHPI (Dam portion) said, most employees from
CGGC are not good experience and also they do not follow the specification of CPE
(consultant). If DHPI employees point out their faults, they gave excuse that they worked like
that in China. Therefore, DHPI employees have closed supervision on the RCC placement in
order to have quality assurance. The following table 4.19 presents different parties participate
in Con (A) with their responsibilities.

Tables 4.19: Different parties in Construction Division (A) with their responsibilities

No. Role Parties Responsibilities

1. Client Ministry of Electric Power (1)
Design and general
Colenco Power Engineering Co.Ltd. supervision
2. Consultant
Switzerland
Local
Construction supervision
3. counterparts of NEPs
in Con (A)
CPE
Department of Hydropower
4. Main Contractor Civil work
Implementation (DHPI)
Foreign China Gezhouba Water & Power Group
5. RCC placing
Subcontractors Co.Ltd ( CGGC)
Hydraulic Steel Structure
China National Electric Equipment
6. (1) (Gates and Crane
Corporation (CNEEC)
contractor)
Joint Venture Consortium of CITIC Hydraulic Steel Structure
7. Technology Co.Ltd and Sinohydro (2) and
Corporation Limited (CCYW) Electromechanical works
Transmission line and
China National Heavy Machinery
8. substation equipment
Corporation (CHMC)
installer
Local
9. Techo Co.Ltd Grouting works
Contractors
10. Golden Tri Start Co. Ltd (GTS) Grouting work
High Tech Concrete Technology Co.Ltd CVC & RCC production,
11. Local Suppliers
(HTCT) Aggregate production
12. Asia World Co. Ltd (AWC) Aggregate production
13. Myan Shwe Pyi Co.Ltd (MSP) Aggregate production
Mistrust between CPE (consultant) and DHPI (main civil contractor) in Con (A). According to
a representative of CPE said, CPE (consultant) intends to have quality assurance but DHPI

84
prefers to have progress. However, an executive of DHPI said, CPE is very strict in task
performing meanwhile the Chinese subcontractors perform not seriously according to
specification. Therefore, DHPI has to negotiate between these two parties frequently.
Therefore, CPE (consultant) suspect to the performance of DHPI.

Mistrust between CPE (consultant) and CCYW (Chinese sub-contractor)

sub contractor) in Con (A) - the
incompetency of CCYW was highlighted by CPE in mid-yearmid year coordination meeting between
parties, 2008. In presentation, Mr. Stuart L.L. Cowie (Chief Resident Engineer of CPE)
pointed out the consequence of the delay civil work information from CCYW regarding
Electrical and Mechanical installation (1). Then CPE recommend to CCYW to increase the
rate of import major equipments such as unit transformer, 11kv bus bars and turbine governors
governor
and submitting detail design as soon as possible by improving the coordination between
CCYW (China) and CCYW (Myanmar). In addition, CPE point out the delay payment of
CCYW to machinery and equipment supplier, Shanghai Voith Siemens Hydro Power
Generationn Co., Ltd (VSS). In conclusion, Consultant said CCYW has to increase engineers
and technician regarding installation of Electrical and Mechanical work in order to complete
the construction on time because CCYW does not have allowable flood time time. Figure 4.27
shows logic model of organizational risk factors and project risk in social network.

Figure 4.27: Logic model of organizational risk factors and project risk in social network

In summary, these problems happen in the project because of the lack of coordination
coo between
senior management of the different parties in Con (A) whereas lack of expertise coordination
in Con (A).

85
4.5.12 Guideline of organizational risk management

According to the analysis results of identification process, 11 risk factors are moderately
influenced to the efficiency of DHPI’s project. These are 1) Technology constraints, 2) Time
constraint resource scheduling, 3) Inaccurate information, 4) Technical Incompetency, 5) Lack
of skilled workforce, 6) Delay major equipment, 7) Insufficient human resource, 8) Resource
constraint project scheduling, 9) Sub-quality resource, 10) Lack of regular meeting and 11)
Mistrust between parties. Therefore, key organizational risk factors which embedded in these
networks are being favor to control in order to improve the efficiency of project. The propose
guideline of organizational risk management framework is mention in the following figure
4.28 which shows the influenced organizational risk factors and their networks of
organization.

Figure 4.28: Guideline of organizational risk management

4.6 Activation of logic model of organizational risk management

In the final step of data analysis procedure, proper organizational risk management is
activated by using logic model technique in order to practice in the organization. The figure
4.29 illustrates the interrelationship of risk factors in the project organization.

86
Figure 4.29: Interrelation of risk factors in project organization

Social Network Knowledge Network Resource Usage Requirement Inter-operability and Co-
Usage Requirement
Mistrust between Lack of regular Technical Lack of skilled
project team meeting incompetency workforce Time constraint resource
members scheduling

Lack of Coordination Lack of Lack of optimization of resource Budget Delay

communication usage

Loss skilled workforce

Delay decision Inefficiency of performance
making
Assignment Network
Resource Network
Insufficient human
resource Delay Major
Equipments

Lack of supervision
Inefficiency of
Critical activities
Project
Fewer floods of uncritical activities
Lack of quality of Construction
assurance Defect
Extra activities Priority of work

Receiving Sub-quality Inaccurate

resources Information Uncertainty of workforce, materials and equipment

Resource Network Information Network

Technology Resource
Constraint Constraint
87
Precedence and Dependencies
4.7 Recommendation for improvement of projects efficiency

Table 4.20: Recommendation for the improvement of DHPI’s projects efficiency

Risk Recommendation for the improvement of project efficiency

Mistrust between • Enhancing the top level coordination between DHPI and others
DHPI and other parties
parties • Enhancing the expertise coordination in DHPI projects
• Senior management pay more attention
Lack of regular
meeting in project • Setting up rule and regulation for the regular meeting by
receiving constant feedback
• Encourage subcontractors to submit detail design submitting
by enhancing the coordination between site and their head
quarter
• Coordination with external organization for the accurate initial
Inaccurate
survey data for the construction design
information
• Set up clear role and responsibility to the different parties in
the projects
• Establishing precise policy for penalty or compensation for
construction defect in the contract agreement
• Setting up specific quality control department in different
construction divisions
Receiving Sub- • Assign specific roles and responsible for the standardization of
quality resource input materials
• Coordination with expert in selecting the specification of input
materials
Lack of skilled • Providing regular training for the improvement of skilled of
workforce workforce
• Proper initial evaluation of physical assets and the actual
requirement in projects
Technical • Regular measuring of the efficiency of the equipment and
incompetency machine
• Provide training for the improvement of technical knowledge
to employees
• Encourage senior management for detail planning of work to
Time constraint
avoid adding the extra activities in project network
resource scheduling
• Evaluate detail of the cooperate resources of organization
Insufficient human • Provide specific technical and managerial training to employee
resource • Set up the regular program for oversea job training
Delay major • Establishing the policy for participating foreign and local
equipment equipment suppliers in project implementation
• Upgrading project management technology and enhancing the
Technology
capability of organization by maintaining the project
constraints
methodology

88
 CHAPTER 5

CONCLUSION AND RECOMMENDATIONS

5.1 Introduction

In modern day, identifying key risks and proper managing risk factors of organization are
correct way to achieve the objected of efficiency of the constructed project. Identifying the
key risk factors is the most important stage of risk management as no work can be done on
risk that no one has discovered (Elkington et al, 2002). This chapter summarizes the important
findings of this study and also recommends guidelines for organizational risk management
that is appropriate for construction project organization.
This aim of this study, key risk factors identification in interlocked network of project
organization is 1) to identify key organizational risk factors embedded in internal
organizational networks in order to make precise decision for risk management, 2) to
understand the process of organizational factors to the project risks, 3) to purpose the
recommendation for the improvement of efficiency of project organization. Qualitative
research design is practiced for identification of risk factors and multiple cases study approach
(two construction divisions) is conducted in order to have robust results of the study. The
research instruments for collecting data are (1) structured interviews with medium to senior
management of DHPI organization (2) questionnaire (mean and rank) (3) sites observation. To
the highest achievement of the objectives of study, risk factors identification is conducted
through 20 interviews in data collection 1) two interviews with top management of DHPI, 2)
16 interviewees with management level from both construction divisions, 3) two interviews
with representative of Consultant (CPE) and Chinese subcontractors (CGGC). Then total 16
questionnaires were distributed to interviewees in both construction divisions.
From the analysis, ten internal organizational networks is consisted in organization risk
management which are 1) Social network, 2) knowledge network, 3) Information networks, 4)
Resource network, 5) Resource usage requirement, 6) Inter-operability and co-usage
requirement, 7) Assignment network, 8) Knowledge requirement 9) Resource requirement,
10) Precedence and dependencies. These all networks are preferable to control for the
improvement of the efficiency of project under organization.

5.2 Research findings

According to the pattern matching analysis between two construction divisions, different risk
factors are influences to the efficiency of projects in Con (A) and (B). The summary of
difference risk factors between Con (A) an (B) is illustrated in next step. However, the results
of cross-cases synthesis analysis highlight that top rank risk factors are embedded in nine
internal organizational networks which are necessary to control for improvement of overall
projects of organization. These internal organizational networks are 1) Social network, 2)
Knowledge network, 3) Information network, 4) Resource Network 5) Resource usage
requirement, 6) Inter-operability and co-usage requirement, 7) Assignment network 8)
Resource Network and 9) Precedence and dependencies.

5.3 Difference top rank risk factors in Con (A) and Con (B)
Based on the factors identification process, some key risks factors and degree of impacts of
risk are different in Con (A) and (B). Difference risk in Con (A) and (B) are separately

89
identified by ranking based on the mean of impact to efficiency of projects. Four key risks
which moderately impact to the efficiency of Con (A) are 1) Technology constraints, 2) Time
constraint resource scheduling, 3) Inaccurate information and 4) Lack of skilled workforce.

However, top 3 ranks of risks are highly and the rest 7 risks of top ten risks are moderately
impact to efficiency of Con (B). Top rank risk factors influenced the efficiency of Con (B) are
1) Technical incompetency, 2) Technology constraints, 3) Inaccurate information, 4) Lack of
regular meeting, 5) Time constraint resource scheduling, 6) Lack of skilled workforce, 7)
Insufficient human resource, 8) Delay major equipment, 9) Ineffectiveness of Cross functional
team and 10) Resource constraint project scheduling.

The investigation results between two construction divisions mentions that internal
organizational risks are moderately impact to the Con (A) whereas it has highly impacted to
Con (B) from highly to moderately. However, some risks are different between two projects
due to the different size and participant of project. Among top risk factors, technology
constraint and inaccurate information are in the top 3 rank of risks in both projects but top
rank risk factor of Con (B), technical incompetency is not included in the top rank of Con (A)
because Con (A) is the priority of organization and support sufficient efficiency of physical
assets by organization. It is obviously that lack of skilled workforce is happening with same
moderately impacted to the Con (A) and Con (B).

The differences risks and their impacts between two projects can be concluded by the main
facts that unclear role and responsibilities of different parties. Moreover, there have no
specific parties have responsible for construction defect and also it does not even have specific
consultant for deficiency of design and general supervision of the in Con (B). However, Con
(A) has specific roles and responsibilities for different parties as aforesaid in cases study
analysis table 4.19. Moreover, top management said that the penalty and compensation of the
efficiency of project are clearly mentioned in the contract agreement between parties in Con
(A).

5.4 Overall risks of internal organizational networks of DHPI

In order to achieve the highest propose of this study, recommendation of the effective
organizational risk management, top management has to manage the identified top risk factors
which cause inefficiency of project. According to the final result of cross-case synthesis
analysis, total 11 top organizational risk factors are influencing in 9 internal organizational
networks of organization in Con (A) and Con (B). These top rank 11 risk factors are 1)
Technology constraints, 2) Time constraint resource scheduling, 3) Inaccurate information, 4)
Technical Incompetency, 5) Lack of skilled workforce, 6) Delay major equipment, 7)
Insufficient human resource, 8) Resource constraint project scheduling, 9) Receiving sub-
quality resources, 10) Lack of regular meeting and 11) Mistrust between parties. According to
cross-cases synthesis analysis, 4 common organizational risk factors are appeared from both

90
projects which are 1) Technology constraint, 2) Time constraint resource scheduling, 3)
Inaccurate information and 4) Lack of skilled workforce. However, technical incompetency is
a unique risk factor of Con (B) which is top rank and highly influenced to construction
schedule. In conclusion, it is crucial to control the organization risk factors which create the
problems in projects in order to improve the efficiency of projects under DHPI.

5.5 Recommendation for organizational risk management in DHPI

Top management of DHPI has fewer expectations about the organizational risk management
just as practical risk management is very poor in the project. Based on findings from the study
of DHPI’s projects, it is obviously preferable to control the organizational risk factors in order
to achieve the efficiency of projects under DHPI. The proposed guideline of organizational
risk management will assist the top management of DHPI in order to make precise decision
for managing risks in the projects. Recommendation for the improvement of construction
schedule in Con (A) and (B) are as follow.

Proper preplanning of activities in term of resource such as material, equipments and

workforce is necessary for the improvement of construction schedule in both projects.

Establishing precise policy for penalty or compensation of construction defect is

necessary in order to prevent the potential loss of organization.

Proper risk management application is necessary to set up in DHPI organization in

order to prevent the risk retention cost as well as achieve the efficiency of the project
certainly.

Top management need to encourage senior management of DHPIs’ projects to emulate

the system of Con (A) and necessary to practice in other local projects under DHPI.

5.6 Recommendation for further study

The research has examined key risk factors influencing project organization and the rational
relationship of organizational factors to project risks. However, due to the constraint of time,
the rest step of risks procedure could not carry out. Therefore, the research study can be
extended to;

• Allocation and mitigation of risk in hydroelectric power projects can further be studied
to fulfill the whole risk management of hydroelectric power projects in Myanmar.
• Investigation of conflicts between parties and dispute resolutions is recommended to
be carried out in order to prevent financially losing of organization.
• A large skill study in risk management for the whole project life cycle is necessary to
carried out of future Joint Venture hydroelectric power project developments.

91
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Projects (BOT), AIT Master Thesis, no. ST-98-53, Asian Institute of Technology,
Pathumthani, Thailand.

Yin, R,K, (2004), Case Study Research Design and Methods (3rd Edition). Applied Social
Research Methods Series, Vol-5. SAGE Publications.

94
Zeynep Isik et al., (2008). Impact of corporate strengths/weakness on project management
competencies.

Zhang, G and Zou, P.X.W, (2007). Fuzzy Analytical Hierarchy Process Risk Assessment
Approach for Joint Venture Construction Projects in China. Journal of Construction
Engineering and Management © ASCE/OCTOBER 2007/771.

Zou, P.X.W, Zhang, G and Wang, J , (2007). Understanding the key risks in construction
projects in China. International Journal of Project Management, 25, 601–614.

Zhang, H and Li, H, (2004). Simulation-based optimization for dynamic resource allocation.
Automation in Construction, 13, 409– 420.

95
 APPENDIX (A)

Interview Checklists

96
 Interviewee Profile

Full name
Age
Organization
Contact address

Position
Contact number
Current Project

How many number of Hydropower projects that you participated?

1-2 3-4 5-6 7-8 9-10

How many years of experience do you have working for hydropower projects?
1-3 4-7 8-12 13-19 >20
How many year of oversea experience did you have before?
1-2 3-4 5-6 7-8 9-10 Νever

What is your highest education achievement?

Certificate Diploma Bachelor Master Doctor

When were your involved in the current project?

Conceptual Stage Tendering Stage
Construction
Design/Planning Financing Stage Stage

97
 Checklist A-Practical Overview of Risk Management in Projects
Code. Checklists Yes No

Does your organization have a policy or application standard for risk

R1
management in this project?
Have you ever had training for the awareness of the systematic risk
R2
management?
R3 Do you often guide and train your subordinate about risk assessment?

R4 Do you think that the risks were properly managed in your organization?

R5 Does the risks management system was properly updated by organization?

Does the organization have periodically orientation for assessing risks and
R6
evaluation the events to mitigate the need?

Does your organization have systematic experience feedback loop for

R7
upgrading data base?
Does the project have specific team/department to certify the quality of
R8
resource from suppliers?
Does the management concern for the proper organizational risk
R9
management in this project?

Do you know that organizational risk management can reduce potential

R10
losses and gain social benefit of the organization?

Do you believe that organizational risk management can improve project

R11
performance?
Does the organization have specific department to check the deficiency of
R12
contract agreement?
R13 Do you satisfy your status in your organization/project?
R14 Does the empowerment is sufficient for you to perform task effectively?
Did you use to have informal meeting with another employee/subordinate
R15
for social interest?
Does organization support efficient equipment and material to perform the
R16
task effectively?
Did you receive the budget on time for payment to the subordinates and
R17
repair equipment?
Does organization has Collaboration with other project organization to
R18 enhance the organization capability such as training, learning production,
design technology deployment?
Do you think the organization should set up the proper risk management
R19
system to carry out the long-term strategies of the organization?

98
 Checklist (B)- Identification of Key Organizational Risk Factors

Degree of Impact

The risk impacts critical activities and causes project cancellation or suspension. For examples, it directly causes project
High
to be delay schedule, lower standard quality requirements, over financial bottom line.

Medium The risk moderately impacts critical activities and still having potential losses.

Low The risk feebly impacts critical activities and couldn’t happen potential losses.

H=High; M=Medium; L=Low

Degree of
No Risk Factor Impact Event Consequence
H M L
Social Network
1 Complex organization structure
2 Lack of delegation
3 Lack of influential power
4 Mistrust between parties
5 Culture difference

Knowledge Network
6 Ineffectiveness of cross-functional team

7 Lack of regular meeting

8 Lack of knowledge Sharing

99
 H=High; M=Medium; L=Low
Degree of
No Risk Factors Impact Event Consequence
H M L
Information Network
9 Inaccurate information
10 Lack of coordination
11 Lack of functional coordination

Resource Network
12 Incorrect resource allocation
13 Receiving sub-quality resource
14 Budget delayed
15 Incompetency of supplier

Resource Usage Requirement

16 Lack of skilled workforce
17 Technical incompetency

Inter-operability and Co-usage Requirement

18 Time constraint resource scheduling
19 Geological barrier
20 Resource shortage (out of stock)

100
 H=High; M=Medium; L=Low
Degree of
No Risk Factors impact Event Consequence
H M L
Assignment Network
21 Insufficient human resource
22 Different attitude and assessment
23 Dissatisfaction on job assigning
24 Improper arrangement of tasks

Knowledge Requirement
25 Delayed information

Resource Requirements
26 Delayed key resources
27 Delayed major equipment

Precedence and dependencies

28 Resources constraint project scheduling
29 Technology constraints

101
 APPENDIX B
Analysis Results of Checklists

102
 Analysis results of Checklist (A)

Respondent
Code. Total Yes/No (%)
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Y 1 1 1 1 1 5 31
R1
N 1 1 1 1 1 1 1 1 1 1 1 11 69
Y 1 1 2 13
R2
N 1 1 1 1 1 1 1 1 1 1 1 1 1 1 14 88
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 14 88
R3
N 1 1 2 13
Y 1 1 1 1 1 1 1 1 1 1 1 1 12 75
R4
N 1 1 1 1 4 25
Y 1 1 1 1 1 1 6 38
R5
N 1 1 1 1 1 1 1 1 1 1 10 63
Y 1 1 1 1 1 1 6 38
R6
N 1 1 1 1 1 1 1 1 1 1 10 63
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 14 88
R7
N 1 1 2 13
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 16 100
R8
N 0 0
Y 1 1 1 1 1 1 1 1 1 1 1 1 12 75
R9
N 1 1 1 1 4 25
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 16 100
R10
N 0 0
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 15 94
R11
N 1 1 6
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 16 100
R12
N 0 0

103
 Respondent
Code. Total Yes/No (%)
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 15 94
R13
N 1 1 6
Y 1 1 1 1 1 1 1 1 1 1 1 1 12 75
R14
N 1 1 1 1 4 25
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 13 81
R15
N 1 1 1 3 19
Y 1 1 1 1 1 1 1 1 1 9 56
R16
N 1 1 1 1 1 1 1 7 44
Y 1 1 1 1 1 1 6 38
R17
N 1 1 1 1 1 1 1 1 1 1 10 63
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 13 81
R18
N 1 1 1 3 19
Y 1 1 1 1 1 1 1 1 1 1 1 1 1 13 81
R17
N 1 1 1 3 19

104
 Checklist (B)-Data Analysis Results of Identification Key Organizational Risk Factors

C=Risk factors, ca =Construction Division (A), cb=Construction Division (B)

Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4

Respondents Mean
Factor Projects (Degree Overall Mean
( Degree of
Code. Codes 1 2 3 4 5 6 7 8 9 of impact)
Impact)
Degree of
ca1 1 1 1 2 2 2 1 1 1 1.33
Impact
C1 1.45
Degree of
cb1 1 3 1 1 2 1 2 1.57
Impact
Degree of
ca1 1 1 1 1 1 1 3 1 1 1.22
Impact
C2 1.33
Degree of
cb2 2 2 1 2 1 1 1 1.43
Impact
Degree of
ca3 1 2 1 2 2 1 2 2 1 1.56
Impact
C3 1.56
Degree of
cb3 2 1 1 3 1 1 2 1.57
Impact
Degree of
ca4 1 1 1 2 2 1 2 1 1 1.33
Impact
C4 1.67
Degree of
cb4 1 3 3 1 2 2 2 2.00
Impact
Degree of
ca5 1 1 1 1 1 1 1 1 1 1.00
Impact
C5 1.00
Degree of
cb5 1 1 1 1 1 1 1 1.00
Impact
Degree of
ca6 1 1 1 2 1 1 1 1 1 1.11
Impact
C6 1.56
Degree of
cb6 2 2 2 2 2 2 2 2.00
Impact
Degree of
C7 ca7 1 1 1 1 1 1 1 1 1 1.00 1.71
Impact

105
 Degree of
cb7 2 2 2 3 3 3 2 2.43
Impact
Degree of
ca8 1 1 1 1 1 1 1 1 2 1.11
Impact
C8 1.48
Degree of
cb8 2 1 1 2 3 2 2 1.86
Impact
Degree of
ca9 1 1 2 1 3 2 3 1 1 1.67
Impact
C9 2.19
Degree of
cb9 3 3 3 3 3 3 1 2.71
Impact
Degree of
ca10 2 1 1 2 2 1 2 1 1 1.44
Impact
C10 1.65
Degree of
cb10 2 3 1 2 2 2 1 1.86
Impact
Degree of
ca11 1 1 1 1 1 1 1 1 1 1.00
Impact
C11 1.14
Degree of
cb11 1 1 1 1 2 1 2 1.29
Impact
Degree of
ca12 1 1 1 1 1 1 1 2 1 1.11
Impact
C12 1.27
Degree of
cb12 2 1 1 2 1 1 2 1.43
Impact
Degree of
ca13 1 2 1 1 1 2 1 2 2 1.44
Impact
C13 1.72
Degree of
cb13 2 3 3 2 1 2 1 2.00
Impact
Degree of
ca14 1 1 1 2 2 2 2 1 1 1.44
Impact
C14 1.44
Degree of
cb14 2 2 2 1 1 1 1 1.43
Impact
Degree of
ca15 1 1 1 1 1 2 1 2 1 1.22
Impact
C15 1.18
Degree of
cb15 1 2 1 1 1 1 1 1.14
Impact
Degree of
C16 ca16 2 1 2 2 1 2 1 2 2 1.67 1.98
Impact

106
 Degree of
cb16 3 2 2 3 1 3 2 2.29
Impact
Degree of
ca17 2 1 1 1 1 1 1 2 2 1.33
Impact
C17 2.10
Degree of
cb17 3 3 4 3 3 3 1 2.86
Impact
Degree of
ca18 2 2 2 2 3 1 3 2 3 2.22
Impact
C18 2.25
Degree of
cb18 2 3 2 3 2 3 1 2.29
Impact
Degree of
ca19 1 1 1 2 2 2 1 2 1 1.44
Impact
C19 1.29
Degree of
cb19 1 1 1 1 1 1 2 1.14
Impact
Degree of
ca20 1 1 1 2 1 1 1 2 1 1.22
Impact
C20 1.47
Degree of
cb20 2 2 2 2 1 2 1 1.71
Impact
Degree of
ca21 1 1 2 1 1 2 2 2 1 1.44
Impact
C21 1.87
Degree of
cb21 2 4 1 2 3 2 2 2.29
Impact
Degree of
ca22 1 1 1 2 1 1 2 1 2 1.33
Impact
C22 1.24
Degree of
cb22 1 1 2 1 1 1 1 1.14
Impact
Degree of
ca23 1 1 2 1 1 1 1 1 1 1.11
Impact
C23 1.06
Degree of
cb23 1 1 1 1 1 1 1 1.00
Impact
Degree of
ca24 1 1 1 2 1 1 1 2 1 1.22
Impact
C24 1.40
Degree of
cb24 2 2 2 1 2 1 1 1.57
Impact
Degree of
C25 ca25 1 1 2 2 2 2 2 1 1 1.56 1.56
Impact

107
 Degree of
cb25 2 2 2 2 1 1 1 1.57
Impact
Degree of
ca26 1 1 1 2 1 1 2 1 2 1.33
Impact
C26 1.52
Degree of
cb26 2 2 1 2 1 2 2 1.71
Impact
Degree of
ca27 2 1 1 2 2 2 2 1 1 1.56
Impact
C27 1.92
Degree of
cb27 3 3 2 3 2 1 2 2.29
Impact
Degree of
ca28 2 1 2 2 1 1 2 2 1 1.56
Impact
C28 1.78
Degree of
cb28 2 2 2 2 2 2 2 2.00
Impact
Degree of
ca29 2 2 2 3 2 2 2 2 1 2.00
Impact
C29 2.36
Degree of
cb29 3 3 2 3 3 3 2 2.71
Impact

108
APPENDIX (C)
Cases Study

109
Construction (A), Yeywa Hydroelectric Power Project (790 MW)

110
Construction (B), Kun (60 MW) and Phyu (40 MW) Hydroelectric Power Projects

111
Quantity of resources that organization supported to Construction Division (A)
Supported Main Resources
Diesel (gal) Cement (ton) Steel (ton)
Budget
Year/Month
Period
Required Received % Required Received % Required Received %

2008/April 486500 350000 72 13961 10606 76 2495 500 20

1st quarter

2008/May 485400 350000 72 14120 8049 57 2545 937 37

2008/June 469450 13209 2293

4th quarter 3rd quarter 2nd quarter

2008/July 472000 13474 2377

2008/Aug 471300 13421 2360
2008/Sep 471300 13421 2360
2008/Oct 452200 11884 1873
2008/Nov 449100 11566 1772
2008/Dec 379000 12042 1940
2009/Jan 75500 4744 1503
2009/Feb 67450 4097 1299
2009/March 68740 4203 1335

112
Quantity of resources that organization supported to Construction Division (B)
Kun Hydroelectric Power Project

Supported Main Resources

Diesel (gal) Cement (ton) Steel (ton)

Budget
Year/Month
Period
Required Received % Required Received % Required Received %

2008/April 160000 129600 81 1390 1151 83

3rd quarter 2nd quarter 1st quarter

2008/May 160000 83200 52 1970 825 42

2008/June 48000 48000 100 1135 0 0
2008/July 19200 24000 125 155 675 435 0 200
2008/Aug 19200 19200 100 375 388 103 64
2008/Sep 19200 22400 117 375 965 257 64
2008/Oct 64000 47200 74 525 199 38 64
2008/Nov 110800 72000 65 736 260 35 34
2008/Dec 142000 91200 64 731 847 116 34
2009/Jan 94800 1132 14
4th quarter

2009/Feb 86000 1149 4

2009/March 77200 1627 164

113
Phyu Hydroelectric Power Project

Supported Main Resources

Budget Diesel (gal) Cement (ton) Steel (ton)
Year/Month
Period Required Received % Required Received % Required Received %

2008/April 16000 11200 70 440 195 44 12 27 226

1st quarter

2008/May 9600 9600 100 78 202 259 6 2 39

2008/June 5600 9600 171 35 0 4 25 726

2008/July 4800 9600 200 29 202 697 4 25 726

2nd quarter

2008/Aug 4800 4800 100 29 0 4 8 228

2008/Sep 6400 6400 100 139 500 360 18 23 127

2008/Oct 8000 8000 100 40 70 175 10 7 70

3rd quarter

2008/Nov 4400 14400 327 174 59 34 10 7 70

2008/Dec 45500 27200 60 176 0 0 10 210 2101

2009/Jan
4th quarter

2009/Feb
2009/March

114
Examination committee;
Presented by
Dr. Chotchai Charoenngam
Aung Myo Hein
Dr. B.H.W. Hadikusumo 106441
Dr. Noppadol Phien-wej 29 May 2009
1
 Content

1. Introduction
2. Problem statements
3. Objectives
4. Key theory
5. Research process
6. Case study analysis
7. Conclusion and recommendation

2
 Introduction
Background (Organization Performance)

No. Commission Hydroelectric Installed Construction Duration

Project Capacity Period
1. Be Lu Chaung (2) 168MW 1960-1974 14
2. Kin Tar 56 MW 1981-1986 6
3. Se daw gyi 25MW 1984-1989 6
4. Be Lu Chaung (1) 28MW 1987-1992 6
5. Zaw Gyi (1) 18MW 1993-1995 3
6. Zaung Tu 20MW 1994-2000 7
7. Zaw Gyi (2) 12MW 1995-1998 4
8. Pa Ti 2MW 1996-1997 2
9. Mone 75MW 1997-2004 8
10. Paung Laung 280MW 1997-2005 9
11. Thaphanseik 30MW 1999-2002 4
12. Ye New 25MW 20__-2006
13. Kabaung 30MW 20__-2008

Most projects were delayed during construction stage.

(Deputy Project Director, Planning and Work Department,
Department of Hydropower Implementation)
3
 Problem statement
•According to initial site observation, practical risk
management of organization was still poor in the project
although organization implemented many projects.

•Most implemented projects of organization were

delay so identification the risk factors causing
problems is being a crucial which fulfill the
deficiency of project developments.

•It is required to discover the

embedded risk factors causing
problem during construction stage.

4
 Objectives
•To identify the risk factors embedded in internal networks
1 of project organization so that systematic approach of the
risk factors can be defined.

•To investigate the rationale of organizational risk factors to

project risk in hydroelectric power projects base on the
2 approach developed.

•To propose the recommendation for organizational risk

3 management that is appropriate for construction project
organization.
5
 Key theory
Organizational risk

•Organizational risk, broadly defined as the risk that the organizational

configuration of a company does not support the achievement of its strategy,
therefore becomes vital to manage for companies in the post-industrial era
(Jeppesen, 2007).
6
 Organization risk analyzer

Figure 2.8: Organization risk analyzer (Carley and Reminga, 2004).

An organization can be modeled and characterized as a set of interlocked networks

connecting entities such as people, knowledge resources, tasks and groups (Carley and
Reminga, 2004).
7
 Internal organizational networks
Internal Organizational
Network
Social Network
Knowledge network
Information network
Resource network
Resource usage requirement
Inter-operability and co-usage
requirement
Assignment Network
Knowledge Requirements
Resource Requirements
Precedence and dependencies
Operational Definition
Social network in construction organization is examined how functional department and
different parties interact with each other, characterizing many formal or informal
connections in order to have effective communication and coordination
Transferring the individual knowledge from one to another in the project team by defining
as the provision or receipt of task information, knowhow, and feedback regarding a
product or procedure
Transferring required information from one point to another and exchange knowledge by
internalization or technology acquisition from other parties
Continuous resource available for concurrent activities in the construction period
Combination of personal knowledge of employee and supporting construction facilities in
order to optimize the existing resource usage
Connections among resources and substitutions to integrate the proper project schedule
during execution period
Assigning tasks to employees inside project and transferring employees from one project
to another project according to the job requirement
Combination of individual competency and supporting relevant document in task
performing
Supporting the require resource to project to perform the task effectively
Generation, verification and modification of construction project schedule networks in
PERT/CPM
8
 Research Process
Identification and Conclusion and
Data collection Data analysis
Verification Recommendation

3.2 Identification 3.3.1 Checklist design

Checklist (A)
Organization risk Practical risk management Cases study
management framework Checklist (B)
Identify key risk factors
(Figure 3.3) Conclusion
Organizational risk 4.3 Practical risk
3.3.2 Pilot test management in organization
analyzer (Carley and •Deputy project director •Ratio analysis of Checklist (A)
Reminga, 2004) •Staff officer
Initial risk factors
•Literature reviews 3.3.3 Project selection 4.4 Differences risk factors
Recommendation
•Construction Division (A), between Cases study
DHPI
•Construction Division (B), •Pattern-matching of risk
3.2.1 Verification DHPI factors in each network of
Professional interviews organization
•Deputy project director of
DHPI (POW department)
•Project Director of 4.5 Overall ranking of key
Construction Division (A) 3.3.4 Interviews organizational risk factors
(Medium to top) •Cross-cases synthesis
•Director general
People
Networks of Relations In Organization

Social Network
Knowledge Resource
Resource Network
Tasks/Projects
Assignment Network
•Deputy director general
•Complex organization
Knowledge Network •Budget delay

•Project director
•Insufficient human resource

People
Structure
•Lack of delegation
•Lack of Influential
Power
•Mistrust between
•Lack of knowledge
sharing
•Lack of regular meeting
•Ineffectiveness of cross-
functional team
•Receiving sub-quality
resource
•Incompetency of
suppliers
•Incorrect resource
• Different attitude and
assessment
•Improper arrangement of
task
•Dissatisfaction on job
4.5.12 Guideline of
•Assistant director
parties
assignment
•Cultural Difference
Information Network
•Inaccurate information
•Lack of coordination
allocation
Resource Usage
Requirements
•Lack of skilled
Knowledge
organizational risk
•Staff officer
within parties Requirements
Knowledge workforce

management
•Lack of functional •Delay information
coordination •Technical
incompetency
(Internal Capability)

Resources
Inter-operability and
Co-usage
Requirements
•Time constraint Resource
Scheduling
Resource
Requirements
•Delay major equipment
Checklists (Figure 4.28)
•Geological barrier
•Resource hortage (out of
stock)
•Delay key resources

Precedence and
16 respondents
Tasks/ dependencies
•Technology constraint
Project •Resource Constraint Project
Scheduling

9
DHPI-Department of Hydropower Implementation
 Identification and verification
Verified risk factors in organizational risk analyzer

People Knowledge Resource Tasks/Projects

Social Network Resource Network
Assignment Network
•Complex organization
Knowledge Network •Budget delay •Insufficient human resource
Structure •Receiving sub-quality
•Lack of knowledge • Different attitude and
•Lack of delegation resource
sharing assessment
People •Lack of Influential
•Lack of regular meeting •Incompetency of •Improper arrangement of
Power
•Ineffectiveness of cross- suppliers task
•Mistrust between
functional team •Incorrect resource •Dissatisfaction on job
parties
assignment
•Cultural Difference allocation
Information Network Resource Usage
•Inaccurate information Requirements
•Lack of coordination Knowledge
•Lack of skilled
within parties Requirements
Knowledge •Lack of functional
workforce
•Delay information
coordination •Technical
incompetency

Inter-operability and
Co-usage
Requirements Resource
•Time constraint Resource Requirements
Resources Scheduling •Delay major equipment
•Geological barrier •Delay key resources
•Resource hortage (out of
stock)

Precedence and
Tasks/ dependencies
•Technology constraint
Project •Resource Constraint Project
Scheduling

Figure 3.5: Verified risk factors 10

 Data Collection
Cases study interviewees list (table 3.1)

DHPI Headquarter Construction Division (A) Construction Division

(B)
•Director General •6 Staff officers •2 Assistant Directors
•Deputy Director General •Representative of CPE (Consultant)
•Representative of CGGC (Subcontractor)
•4 Staff officers

Unstructured interviews Structured interview

Top Consultant Subcontractor Assistant Staff
Management (CPE) (CGGC) Director Officer
Head Quarter 2 1 1
Construction Division (A) 4 6
Construction Division (B) 2 4
2 1 1 9 7
Total 4 16

CPE-Colenco Power Engineering (Switzerland), Consultant of Con (A) 11

CGGC- China Gezhouba Water & Power Group Co., Ltd
 Data Collection
Key risk factor identification, checklist (A) and (B)

Checklist (A)- Practical risk management in project

Please read carefully and tick(

) based on your experienced and belief
No. Checklists Yes No Checklist (B)- Key risk factor identification
1 Does your organization have a policy or application standard for
risk management in this project? In order to find out the key risk factors in Myanmar Hydropower Project Organization, Please
read carefully and tick (
) in the following checklist whatever you think is the most appropriate
2 Have you ever had training for the awareness of the systematic
H=High; M=Medium; L=Low
risk management?
Degree of
3 Do you often guide and train your subordinate about risk No Risk Factor Impact Event Consequence
assessment?
H M L
4 Do you think that the risks were properly managed in your Social Network
organization? Complex Organization
Structure damage to the
5 Does the risks management system was properly updated by 1
personal communication
organization? channel
Lack of Delegation
Does the organization have periodically orientation for assessing (Authority and
6 2
risks and evaluation the events to mitigate the need? Responsibility) in the
Governance structure
Lack of Influential Power
such as motivation, Job
satisfaction, commitment,
Con (A) Con (B) 3
personal development and
so on within project team
Assistant 4 2 members
4 Mistrust between parties
Director 5 Cultural Difference

Staff Officer 6 4 The risk impacts critical activities and causes project cancellation or
suspension. For examples, it directly causes project to be delay
High
schedule, lower standard quality requirements, over financial bottom
10 6 line.
the risk moderately impacts critical activities and still having potential
Total respondents=16 nos. Medium
losses.
the risk feebly impacts critical activities and couldn't happen potential
Low
losses.
12
13
 Cases study
Background
Construction Division (A), Yeywa Hydroelectric Power Project
1. Name Yeywa Hydroelectric Power Project
2. Location Southeast of 32 miles far away from Mandalay City
3. Dam Type Roller Compacted Concrete Dam
4. Install Capacity 790 MW (4 x 197.5 MW)
5. Project Period 2001-2010
6. Completed (%) 70 (%), Nov 2008
7. Contractor Department of Hydropower Implementation, DHPI

Construction Division (B), Kun and Phyu Hydroelectric Power

Projects
1. Name Kun Hydroelectric Power Project
2. Location Southwest of 9miles far away from Phyu City, Bago Division

3. Dam Type Rock Fill Dam

4. Install Capacity 60 MW (2x 30 MW)
5. Project Period 2003-2010
6. Completed (%) 70 (%), Dec 2008
7. Contractor Department of Hydropower Implementation, DHPI

1. Name Phyu Hydroelectric Power Project

2. Location West of 7 miles far away from Phyu City, Bago Division
3. Dam Type Earth Dam
4. Install Capacity 40 MW (2 x 20 MW)
5. Project Period 2004-2010
6. Completed (%) 44.15 %, Dec 2008
7. Contractor Department of Hydropower Implementation, DHPI 14
 Construction Division (A),
Yeywa Hydroelectric Power Project

15
 Construction (B)
Kun and Phyu Hydroelectric Power Projects

Construction Division (B)

Kun Hydroelectric Power

Projects (60 MW)

Phyu Hydroelectric Power

Projects (40 MW)

16
 Data Analysis

Cases study

Practical Comparison of
Overall top risk
overview of risk differences risks
factors in Research findings
management in factors between
organization
project Con (A) and (B)

ca= Con (A), cb= Con (B)

Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4

Con (A) risk factors ranking Con (B) risk factors ranking

Mean Classificat Mean Classificati Mean

Risk factor Rank Rank (Degree
Overall Mean
Ran Classif
(Impact) ion Risk factor (Impact) on Risk Factor Codes
of
(Degree of
Impact)
k ication
Impact)

C
Y N
Time
od Checklists
e.
es o constraint ca29 2.00 1 M
2.22 1 M 2.86 1 H
R Does your organization have a policy or application standard resource Technical
1 for risk management in this project? 31 69 Technology constraints 2.36

R Have you ever had training for the awareness of the

scheduling incompetency cb29 2.71

2 systematic risk management? 13 88 Technology Technology

R Do you often guide and train your subordinate about risk 2.00 2 M 2.71 2 H ca18 2.22 2 M

3 assessment? 88 13
constraints constraints
R Do you think that the risks were properly managed in your Inaccurate Inaccurate Time constraint resource scheduling
cb18 2.29
2.26

4 organization? 75 25 1.67 3 M 2.71 3 H

R Does the risks management system was properly updated by
information information
ca9 1.67 3 M
5 organization? 38 63 Lack of skilled Lack of regular Inaccurate information 2.19

R Does the organization have periodically orientation for 1.67 4 M 2.43 4 M cb9 2.71

6 assessing risks and evaluation the events to mitigate the need? 38 63

workforce meeting ca17 1.33 4 M

R Does your organization have systematic experience feedback Lack of Time constraint
7 loop for upgrading data base? 88 13 Technical incompetency 2.10

R Does the project have specific team/department to certify the 10

influential 1.56 5 L resource 2.29 5 M cb17 2.86

8 quality of resource from suppliers? 0 0 power scheduling ca16 1.67 5 M

R Does the management concern for the proper organizational
9 risk management in this project? 75 25
Delay Lack of skilled
1.56 6 L 2.29 6 M
R Do you know that organizational risk management can reduce 10 information workforce Lack of skilled workforce
cb16 2.29
1.98

10 potential losses and gain social benefit of the organization? 0 0

R Do you believe that organizational risk management can
Delay major Insufficient
1.56 7 L 2.29 7 M ca27 1.56 6 M

11 improve project performance? 94 6 equipment human resource

R Does the organization have specific department to check the 10
12 deficiency of contract agreement? 0 0
Resources Delay major equipment
cb27 2.29
1.93

R
Do you satisfy your status in your organization/project?
constraint
13 94 6 1.56 8 L 2.29 8 M ca21 1.44 7 M

R Does the empowerment is sufficient for you to perform task

project Delay major
14 effectively? 75 25 scheduling equipment Insufficient human resource
cb21 2.29
1.87

R Did you use to have informal meeting with another

15 employee/subordinate for social interest? 81 19
Ineffectiveness
R Does organization support efficient equipment and material to 1.44 9 L of cross- 2.00 9 M ca28 1.56 8 M

16 perform the task effectively? 56 44

R Did you receive the budget on time for payment to the
Budget delay functional team Resources constraint project scheduling
cb28 2.00
1.78

17 subordinates and repair equipment? 38 63 Resources

Does organization has Collaboration with other project
R
organization to enhance the organization capability such as
constraint ca13 1.44 9 M

18 1.44 10 L 2.00 10 M
training, learning production, design technology deployment? 81 19 Lack of project Sub-quality resource 1.72
Do you think the organization should set up the proper risk cb13 2.00

R
management system to carry out the long-term strategies of
coordination scheduling
19
the organization? 81 19 Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4 ca7 1.00 10 M

Lack of regular meeting 1.72

cb7 2.43

ca4 1.33 11 M

Mistrust between parties 1.67

17
 Practical risk management in Project
Code. Checklists Yes No
Does your organization have a policy or application standard for risk
R1
management in this project?
Have you ever had training for the awareness of the systematic risk
31 69
•No proper policy or application of risk
R2
management? 13 88
management in projects
R3
Do you often guide and train your subordinate about risk assessment? 88 13
•No specific training providing for the
R4
Do you think that the risks were properly managed in your organization? 75 25 awareness of risk to employee
R5
Does the risks management system was properly updated by organization? 38 63 •People believe the advantage of risk
Does the organization have periodically orientation for assessing risks and
R6
evaluation the events to mitigate the need? 38 63 management but top management do not
Does your organization have systematic experience feedback loop for
R7
upgrading data base? 88 13 expect benefit on the value of risk
Does the project have specific team/department to certify the quality of
R8
resource from suppliers? 100 0
management
Does the management concern for the proper organizational risk
R9
management in this project? 75 25
Do you know that organizational risk management can reduce potential
R10
losses and gain social benefit of the organization? 100 0
Do you believe that organizational risk management can improve project
R11
performance?
Does the organization have specific department to check the deficiency of
94 6 People do not consider the indirect effect
R12

R13
contract agreement?
Do you satisfy your status in your organization/project?
100
94
0
6
of risk (representative of consultant, CPE)
R14 Does the empowerment is sufficient for you to perform task effectively?
75 25
Did you use to have informal meeting with another employee/subordinate
R15
for social interest? 81 19
Does organization support efficient equipment and material to perform the
R16
task effectively? 56 44 Necessary to set up proper risk management in
Did you receive the budget on time for payment to the subordinates and
R17
repair equipment? 38 63 organization
Does organization has Collaboration with other project organization to
R18 enhance the organization capability such as training, learning production,
design technology deployment? 81 19

R19 Do you think the organization should set up the proper risk management
system to carry out the long-term strategies of the organization? 81 19

Total interviewees=16, Yes% = % of respondents’ agreement

18
Comparison of risk factors in different internal
organizational networks
People Knowledge Resource Tasks/Projects
Social Network Resource Network
Assignment Network
•Complex organization
Knowledge Network •Budget delay •Insufficient human resource
Structure •Receiving sub-quality
•Lack of knowledge • Different attitude and
•Lack of delegation resource
sharing assessment
People •Lack of Influential
•Lack of regular meeting •Incompetency of •Improper arrangement of
Power
•Ineffectiveness of cross- suppliers task
•Mistrust between
functional team •Incorrect resource •Dissatisfaction on job
parties
assignment
•Cultural Difference allocation
Information Network Resource Usage
•Inaccurate information Requirements
•Lack of coordination Knowledge
•Lack of skilled
within parties Requirements
Knowledge •Lack of functional
workforce
•Delay information
coordination •Technical
incompetency

Inter-operability and
Co-usage
Requirements Resource
•Time constraint Resource Requirements
Resources Scheduling •Delay major equipment
•Geological barrier •Delay key resources
•Resource hortage (out of
stock)

Precedence and
Tasks/ dependencies
•Technology constraint
Project •Resource Constraint Project
Scheduling

19
 Differences risk factors between cases study
4.4.3 Information Network
Table 4.9 Data analysis results of information network in Con (A) and Con (B) Con (A)
Construction (A)
Problem
Mean •Incompetency of Subcontractor
Risk Factor Code Rank Class
Impact •Delay submitting civil work design of
Inaccurate information ca9 1.67 1 M subcontractor (CCYW)
Lack of coordination within differentparties ca10 1.44 2 L (Mr. Cowie, Chief resident engineer of
Lack of functional coordination ca11 1.00 3 L CPE, Mid year Coordination meeting,
2008)
Construction (B)
Mean
Risk Factor Code
Rank Class
Impact
Inaccurate information cb9 2.71 1 H
Lack of coordination within different parties cb10 1.86 2 M
Rework
Lack of functional coordination cb11 1.29 3 L
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4

Con (B)
Design
Problem •NEPS-local consultant (proposal) Construction Defect
•Inaccurate initial survey data Kansai Consultant (before) •3 times tunnel collapse
•Unclear role and •General supervision
•1 times surge tank collapse (after
responsibilities of parties •Revised deficiency of Design
•MOU with Kansai was finished in June 80% completed)
•Lack of expertise coordination 2008

NEPs-National Engineering and Planning services

CPE-Colenco Power Engineering (Switzerland), Consutant of Con (A) 20
CCYW- Joint Venture Consortium of CITIC Technology Co.Ltd and Sinohydro Corporation Limited, subcontractor (Hydraulic steel structure (2) and Electromechanical work)
 Construction defect in Con (A) and (B)
4.4.3 Information Network
Con (B-1) tunnel construction
Con (B-2) tunnel collapse failure
(Past) (Dec 2008)

Con (B-2) tunnel collapse Con (B-1) tunnel shrink

(Past) (Dec 2008)
Con (A) Vs chipping work
Collapsed after 80% completed, 2007

Due to unclear role

and responsibilities,
organization suffered
the damage of
construction failure
Con (B-1) New Surge tank 21
 Differences risk factors between case study
4.4.6 Inter-operability and co-usage requirement
Table 4.12 Data analysis results of inter-operability and co-usage requirement in Con (A) and Con (B)
Geological barrier
Construction (A) Problem
Mean
Risk Factor Code Rank Class
Impact Maximum loading of
Time constraint resource scheduling ca18 2.22 1 M infrastructure-60tons
Geological barrier ca19 1.44 2 L Con (A)
Resource shortage (out of stock) ca20 1.22 3 L Net body weigh of
transformer=72.5tons
Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Time constraint resource scheduling cb18 2.29 1 M
Geological barrier cb20 1.71 2 M
Resource shortage (out of stock) cb19 1.14 3 L
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4

Time constraint resource scheduling

Problem
•Lack of detail planning of work
(POW)
Budget delay
•Inaccurate evaluation of cooperate
resource

22
 Differences risk factors between case study
Budget delay
Application processing time
Cabinet (1month)

1 weeks
Minister
1weeks Planning and work Dept: &
Finance Dept
2 weeks
Project Director
Decision making process for extra cost and 23
additional activities cost

Annual Budget Period of Organization and Resource Available

Resource available
1st quarter 2nd quarter 3rd quarter 4th quarter 100%
(Apr-Jun) (July-Sep) (Oct-Dec) (Jan-March)
80-90 %
•Monthly POW •Monthly POW •Monthly POW •Monthly POW
•2nd Quarter POW •3rd Quarter POW •4th Quarter POW •1st Quarter POW
•General POW for next 70-80%
budget period
 Differences risk factors between case study
4.4.5 Resource usage requirement
Table 4.11 Data analysis results of resource usage requirement in Con (A) and Con (B)
Construction (A) Lack of skilled workforce
Mean Problem
Risk Factor Code Rank Class •Growth of investment
Impact
•Delay Budget
lack of skilled workforce ca16 1.67 1 M •Limitation of Accountability
Technical incompetency ca17 1.33 2 L

Construction (B)
Mean
Risk Factor Code Rank Class
Impact
Technical incompetency cb17 2.86 1 H
lack of skilled workforce cb16 2.29 2 M
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4

3rd coordination meeting, 2006 (Kansai-

Technical incompetency DHPI)
Problem Recommendation
•Lack of initial evaluation of •Break down of Jumbo 50hrs per month (Dec ,
Current (Jumbo)
technical competency 2005) -assign of a full-time mechanic at site 10days break down
•80% efficiency in Con (A) and daily check by operators for the
•<60% efficiency in Con (B) reduction of down time of Jumbo per month
Over break
•Proper survey before blasting
•Attention to gradient of drilling rod parallel
DHPI-Department of Hydropower Implementation 24
Kansai-Kansai Electric Power company (Japan), former consultant of Con (B)
 Existing equipment in Con (A) and (B)
Efficiency of equipments

Inefficiency of equipments
60%< in Con (B)

80% in Con (A)

60%< in Con (B)

25
 Lack of skilled workforce

Role in Head Office Role in Project Authority and Responsibility Accountability

Organization

Director General
al level

Deputy Director
General
•Planning of scope
Supreme
Project level

•Schedule approve
Director •Director,
Engineer •Design approve
(3,000,000kyats)
•Design variation
Assistant •Needs •Deputy
Supreme •Negotiation with different parties Director,
Deputy Director Engineer
•Change of requests
(1,000,000kyats)
•Procurement

•Plan of Work (Time, Scope, Resource)

•Managing project team •Assistant 14
Functional

Executive •Financial control Director

Assistant Director
level

Engineer •Method of works (500,000kyats)

•Dispute resolutions within project 12
teams

•Local Sub contractors payment control 10

Operation

•Task Performing •Staff Officer

Assistant
level

•Construction Engineering
Staff Officer (100,000kyats)
•Progress report
Engineer •Feedback 8

Exchange rate :1 USD = 1050kyats (17,03.09) 6

Limitation of accountability
4
Project Director= US$ 3000
Deputy project Director US$1000 2
Assistant Director= US$ 500
Staff Officer= US$ 100 0
(Exchange rate: 1 US $= 1050 kyats 1961-1970 1971-1980 1981-1990 1991-2000 2001-2010
hydroelectric power
1 0 3 7 13
projects
Growth of hydroelectric power project implementation 26
 Differences risk factors between case study
4.4.9 Precedence and dependencies

Table 4.16 Data analysis results of precedence and dependencies in Con (A) and Con (B)
Construction (A)
Mean Resource constraint
Risk Factor Code Rank Class
Impact
Technology constraints ca29 2.00 1 M Problem
Resources constraint project scheduling ca28 1.56 2 L •Limited import material such
as steel, diesel, concrete
Construction (B) •Limited local production
Mean
Risk Factor Code Rank Class
Impact
Technology constraints cb29 2.71 1 H
Resources constraint project scheduling cb28 2.00 9 M Priority of work
Scale of Impact to Construction Schedule: Low=1-1.7, Medium= 1.6-2.4, High= >2.4

Technology constraints

Inexperience of similar Extra activities add in project

project network
Fewer floods of
Only control critical uncritical activities
Lack of planning activities
technology Critical activities
27
 Resource constraint project scheduling
Organization supported resources to Construction Division (B-1), Kun project,
2008
Supported Main Resources
Diesel (gal) Cement (ton) Steel (ton)
Budget
Year/Month
Period Required Received Received% Required Received Received% Required Received Received%

2008/April 160000 129600 81 1390 1151 83

1st quarter

2008/May 160000 83200 52 1970 825 42

2008/June 48000 48000 100 1135 0 0
2nd quarter

2008/July 19200 24000 125 155 675 435 0 200

2008/Aug 19200 19200 100 375 388 103 64
2008/Sep 19200 22400 117 375 965 257 64
2008/Oct 64000 47200 74 525 199 38 64
3rd quarter

2008/Nov 110800 72000 65 736 260 35 34 Resource shortage

2008/Dec 142000 91200 64 731 847 116 34
2009/Jan 94800 1132 14
4th quarter

2009/Feb 86000 1149 4

2009/March 77200 1627 164

28
 Top risk factors of Con (A) and Con (B)
Con (A) risk factors ranking Con (B) risk factors ranking

Mean Mean
Risk factor Rank Classification Rank Classification
(Impact) Risk factor (Impact)
Time constraint resource
2.22 1 M 2.86 1 H
scheduling Technical incompetency
2.00 2 M 2.71 2 H
Technology constraints Technology constraints
1.67 3 M 2.71 3 H
Inaccurate information Inaccurate information
Lack of skilled
1.67 4 M 2.43 4 M
workforce Lack of regular meeting
Time constraint resource
1.56 5 L 2.29 5 M
Lack of influential power scheduling
1.56 6 L 2.29 6 M
Delay information Lack of skilled workforce
Insufficient human
1.56 7 L 2.29 7 M
Delay major equipment resource
Resources constraint
1.56 8 L 2.29 8 M
project scheduling Delay major equipment
Ineffectiveness of cross-
1.44 9 L 2.00 9 M
Budget delay functional team
Resources constraint
1.44 10 L 2.00 10 M
Lack of coordination project scheduling
Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4

29
 Overall ranking of risk factors of organization
Overall top rank risk factors of projects
ca= Con (A), cb= Con (B)
Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
Mean Overall 11 organizational risk factors
Risk Factor Codes
(Degree Mean
Rank
Classifi moderately impact to efficiency
of (Degree of cation
Impact) Impact)
of projects
ca29 2.00 1 M
Technology constraints
cb29 2.71
2.36 1. Technology constraints
Time constraint resource ca18 2.22
2.26
2 M 2. Time constraint resource
scheduling cb18 2.29 scheduling
ca9 1.67 3 M
Inaccurate information
cb9 2.71
2.19 3. Inaccurate information
Technical incompetency
ca17 1.33
2.10
4 M 4. Technical incompetency
cb17 2.86
Lack of skilled ca16 1.67 5 M
5. Lack of skilled workforce
1.98
workforce cb16 2.29 6. Delay major equipment
ca27 1.56 6 M
Delay major equipment
cb27 2.29
1.93 7. Insufficient human resource
Insufficient human ca21 1.44 7 M 8. Resource constraint project
1.87
resource cb21 2.29 scheduling
Resources constraint ca28 1.56 8 M
project scheduling cb28 2.00
1.78 9. Sub-quality resource
Sub-quality resource
ca13 1.44
1.72
9 M 10. Lack of regular meeting
cb13 2.00
ca7 1.00 10 M
11. Mistrust between parties
Lack of regular meeting 1.72
cb7 2.43
Mistrust between parties ca4 1.33 1.67 11 M
30
Guideline of organizational risk management
People Knowledge Resource Tasks/Projects

Assignment Network
Social Network Knowledge Network Resource Network
•Mistrust between •Lack of regular •Receiving sub- •Insufficient human
People
parties meeting team quality resource resource

Resource Usage
Requirements
Information Network •Lack of skilled
•Inaccurate workforce
Knowledge
information •Technical
incompetency

Inter-operability and
Co-usage Requirements Resource
•Time constraint Requirements
Resources •Delay major
Resource
Scheduling equipment

Precedence and
Tasks/ dependencies
•Technology constraint
Project •Resource Constraint Project
Scheduling

Figure 4.28: Guideline of organization risk management

31
Interrelation of risk factors in project organization

Figure 4.29: interrelation of risk factors in project organization

32
 Research findings
Overall top rank risk factors of projects
Construction Construction ca= Con (A), cb= Con (B)
Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
division (A) division (B) Mean Overall Mean
Classificati
Risk Factor Codes (Degree of (Degree of Rank
on
1. Time Constraint 1. Technical Impact) Impact)

resource scheduling incompetency ca29 2.00 1 M

Organizational Risk

Technology constraints 2.36

2. Technology constraints 2. Technology cb29 2.71
ca18 2.22 2 M
3. Inaccurate information constraints
Identified Key

Time constraint resource scheduling 2.26

cb18 2.29
4. Lack of skilled 3. Inaccurate Information ca9 1.67 3 M
Inaccurate information 2.19
Factors

cb9 2.71
workforce ca17 1.33 4 M
Technical incompetency 2.10
cb17 2.86
ca16 1.67 5 M
Lack of skilled workforce 1.98
cb16 2.29
ca27 1.56 6 M
Delay major equipment 1.93
cb27 2.29
Moderately impact Highly impact to ca21 1.44 7 M
Insufficient human resource 1.87
to Construction Construction cb21 2.29
ca28 1.56 8 M
Division (A) Division (B) Resources constraint project scheduling
cb28 2.00
1.78

ca13 1.44 9 M
Sub-quality resource 1.72
cb13 2.00
ca7 1.00 10 M
Ranking of Differences risk factors between Con (A) and (B) Lack of regular meeting
cb7 2.43
1.72

Con (A) risk factors ranking Con (B) risk factors ranking Mistrust between parties ca4 1.33 1.67 11 M

Mean Mean
Risk factor Rank Classification Rank Classification
(Impact) Risk factor (Impact)
Time constraint
2.22 1 M 2.86 1 H
resource scheduling Technical incompetency
Common Organizational Risk Factors in both
2.00 2 M 2.71 2 H
Technology constraints Technology constraints Construction Divisions
1.67 3 M 2.71 3 H
Inaccurate information Inaccurate information
Lack of skilled
1 Technology Constraints
1.67 4 M 2.43 4 M
workforce Lack of regular meeting
Lack of influential Time constraint resource 2 Time Constraint Resource Scheduling
1.56 5 L 2.29 5 M
power scheduling
1.56 6 L 2.29 6 M
3 Inaccurate Information
Delay information Lack of skilled workforce
Insufficient human 4 Lack of Skilled Workforce
1.56 7 L 2.29 7 M
Delay major equipment resource
Resources constraint
1.56 8 L 2.29 8 M
Unique risk factors between Construction
project scheduling Delay major equipment
divisions
Ineffectiveness of cross-
1.44 9 L 2.00 9 M
Budget delay functional team
Resources constraint
1 Technical incompetency
Lack of coordination
1.44 10 L
project scheduling
2.00 10 M
33
Scale of Impact: Low=1-1.65, Medium= 1.66-2.4, High= >2.4
 Conclusion

The differences risks and their impacts between two projects can be concluded by the main
facts that unclear role and responsibilities of different parties.

Three organizational risk factors 1) Technical incompetency, 2) Technology constraint and 3)
inaccurate information are highly impact to the Construction division (B) so it is necessary to
pay attention for the organizational risk in this project.

Identified overall top 11 organizational risk factors; 1) Technology constraints, 2) Time
constraint resource scheduling, 3) Inaccurate information, 4) Technical Incompetency, 5) Lack
of skilled workforce, 6) Delay major equipment, 7) Insufficient human resource, 8) Resource
constraint project scheduling, 9) Receiving sub-quality resources, 10) Lack of regular meeting
and 11) Mistrust between parties are influencing in 9 internal organizational networks and
moderately impact to the efficiency of DHPI’s projects.

Cross-Cases synthesis, 1) Technology constraint, 2) Time constraint resource scheduling, 3)
Inaccurate information and 4) Lack of skilled workforce are common happened during
construction stage which is priority to control for the improvement of construction schedule in
both construction divisions.

The proposed guideline of organizational risk management will assist the top management of
DHPI in order to make precise decision for managing risks in the projects.

34
 Recommendation

Proper preplanning of activities in term of resource such as material,

equipments and workforce is necessary for the improvement of construction
schedule in both projects.

Establishing precise policy for penalty or compensation of construction
defect is necessary in order to prevent the potential loss of organization.

Proper risk management application is necessary to set up in DHPI
organization in order to prevent the risk retention cost as well as achieve the
efficiency of the project certainly.

Top management need to encourage senior management of DHPIs’ projects
to emulate the system of Con (A) and necessary to practice in other local
projects under DHPI.

35
 Recommendation for further study

Allocation and mitigation of risk in hydroelectric power projects can further

be studied to fulfill the whole risk management of hydroelectric power
projects in Myanmar.

Investigation of conflicts between parties and dispute resolutions is
recommended to be carried out in order to prevent financially losing of
organization.

A large skill study in risk management for the whole project life cycle is
necessary to carried out of future JV hydroelectric power project
developments

36
THANK YOU ☺

37